Indian exporters of carpets and handicrafts expect up to 10% benefit from the ongoing rupee depreciation. Sectors with a low dependence on imports stand to gain while others will lose their benefits to higher oil and commodity prices, it is believed. The rupee has shed almost 3.5% against the US dollar this year and 3.2% since Russia’s military operations in Ukraine on February 24.
“Higher metal and oil prices will get neutralised by a depreciating rupee. We expect a 2-3% growth in exports,” said Rakesh Kumar, Director General, Export Promotion Council for Handicrafts.
Carpet exporters say they may not benefit much as the woollen carpets industry have a 10-12% dependence on imported wool and dyes, and the amount of rupee depreciation is directly proportional to the export gains. While exports do get a push from a weaker rupee, the benefit gets reversed by a rise in transportation and import costs, they say.
“Almost 60% of our goods trade is in dollars and the depreciation will help our traditional sectors such as textiles and leather,” said Ajay Sahai, director general, Federation of Indian Export Organisations. Textile exporters have begun receiving queries from buyers to cut prices for fresh orders. “Our orders from Europe are being deferred and there are issues related to shipping also. And many buyers want us to pass on the benefits of a weaker rupee to them,” said a Delhi-based garment exporter.