The Centre will soon announce an export stimulus package to sustain growth and make life easy for exporters reeling under high interest rates.
Commerce secretary Rahul Khullar said the package is expected to be unveiled in the next two-three weeks. The central government had recently conducted a survey to identify sectors that still need assistance.
“Times have changed, budget conditions have changed, in another week DEPB (Duty Entitlement Passbook) scheme will die. Lots of things have changed. We need to rejig that package. Second, interest rates have radically changed between the last year and now.”
Khullar said exchange rates are going to remain volatile for the time being because the financial markets are unstable and investors are moving between assets and currency exchanges for achieving safe havens.
“Now what we have do is to put together a package which would look at all these components — how to address interest rate hike, how to have access to foreign currency denominated credit, issues relating to packaging credit and then the question of incentives and rejiging.”
Khullar asked exporters to hedge their risks in a volatile exchange rate scenario. “Hedge your risks and don’t get too greedy has been my advice to the exporters always. Do not go to banks and buy some derivatives which you do not understand. Exchange rates are going to be volatile. Your business is to produce, export and get your money.”
During April-August exports increased by 54.2 per cent to $134.5 billion. On Wednesday, the Ministry of Finance had notified duty drawback rates covering all products of the DEPB Scheme, which is going to be withdrawn from October 1.
