Exports likely to be impacted during next fiscal due to coronavirus: Exporters

Seeking support from the government to deal with the impact of the coronavirus outbreak, exporters on Thursday said the country's outbound shipments may get impacted during the next financial year, according to industry sources.

The issue was raised in a meeting called by the commerce ministry to discuss supply-chain disruption due to the coronavirus outbreak.

The meeting was chaired by Minister of State for Commerce and Industry Som Parkash.

It was attended by representatives of export promotion councils, industry chambers like CII, FICCI, Assocham and PHDCII and Federation of Indian Export Organisations (FIEO).

It was also suggested in the meeting to provide support to banks to deal with liquidity-related matters.

 

"Export consignments are being deferred due to the coronavirus outbreak. Enquiries too at lower side. Due to this, exports will be impacted in the second and third quarter of the next fiscal," a source who participated in the meeting said.

FIEO Director General Ajay Sahai, who attended the meet, said that looking into the gravity of the situation, "we have urged the government to provide some relief to the industry".

The suggestions include extension of export obligation period under Advance Authorization and Export Promotion Capital Goods by one year; automatic revalidation to all duty-free authorisations by one year to enable the industry to import inputs at right price; and extension of the remittance period from 9 months to 15 months by the RBI looking into the liquidity challenges and slow consumer spending.

"Banks may be asked to delay the declaring companies' accounts as NPA (non-performing assets) for one year as the lack of business coupled with fixed cost will make many accounts as NPAs," Sahai said.

The government should also ease out the liquidity by immediately releasing all exports benefits to exporters including risky exporters for which a bond may be taken from risky exporters.

Another industry source said that as China was a global supplier of goods, huge export and import opportunities have emerged due to the outbreak of this deadly disease in China and other parts of the globe.

"The outbreak of this disease has reflected that depending completely on one country for goods is not a good idea and in such a situation, India is best placed to fill this global supply chain gap," the source said.