European debt crisis may hit exports: Scindia

NEW DELHI: Minister of state for commerce and industry Jyotiraditya Scindia today said the widening debt crisis in the euro zone economies is likely to impact the country's exports to the region and called on exporters to prepare themselves to tackle the possible fallout.

"Just as we were about to breathe a sigh of relief... the Greece crisis is certainly going to impact our exports going forward. I think we need to brace ourselves," Scindia told reporters after inaugurating an MMTC gold festival here.

Even though Greece is likely to get a 110 billion euro bailout deal from other European Union and the IMF, there are rising fears about the debt contagion spreading across Europe.

On May 6, global rating agency Moody's warned that the Greece crisis could impact banking systems in many European countries including Britain.

The US and the EU are the major markets for the country's exports which were hit-hard due to global recession. As a result, exports fell 4.7 per cent to USD176.5 billion in 2009-10.

Scindia, however said, "I think we will be able to reach target of USD 200 billion in 2010-11."

The government is also planning to provide sops to sectors like engineering, ready made garments, leather, carpets, oil meals, petroleum products and gems and jewellery, struggling to find buyers. There are sectors like handicrafts, textiles and engineering which need immediate attention, he said.

Stressing the need to diversify the country's international business, Scindia said, there is a need to tap new markets in regions like South Africa and Latin America.