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Eurozone crisis may hit exports to EU: Fin Secy
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SME Times News Bureau
The Eurozone debt crisis may have some adverse short-term impact on Indian exports to the European Union, said Finance Secretary, Ashok Chawla on Monday.
Inaugurating ASSOCHAM organized Conference on Banking and Financial Regulators in New Delhi, Chawla admitted that India's exports in short term to the EU and it's market could face some problem due to it's ongoing financial crisis.
Chawla, however, added that the financial turmoil will have "minimum effect" on India's exports in current fiscal.
"In the long run, however, the impact would be negligible as India has faced bigger crisis of larger volumes without letting it’s economy shrink beyond a point and the current crisis of Europe are going to be a temporary affair," he said.
"Therefore, there is no need to worry on this front," assured the Finance Secretary.
On the same day, Commerce Minister Anand Sharma told reporters at the sidelines of a conference in the national capital that India has not seen any significant adverse impact from the European debt crisis.
A crisis of confidence in Europe has been triggered by a potential debt default by Greece. The European Union and the International Monetary Fund (IMF) have announced a $1 trillion emergency financial aid package, which is expected to stabilise world financial markets and curb speculative attacks on the Euro.
With the euro gaining USD 1.30 in the late European morning trading on Monday after assurances by European leaders to save the currency from falling apart, Indian firm who export a bulk of their products to the EU heaved a sigh of relief. In many export segments like garments, 50-70 percent of the invoicing is done in euro.
Chawla went on adding that domestic capital market would also absorb the off shoot of crisis, arisen in European markets in the sense that FIIs investments into it would continue and the flight of their capital is unlikely to other destinations.
The domestic economy, according to the Finance Secretary would move on to double digit growth rate but the challenge for policy maker will remain for this growth to be made inclusive.
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| Customs Exchange Rates |
| Currency |
Import |
Export |
US Dollar
|
84.35
|
82.60 |
UK Pound
|
106.35
|
102.90 |
Euro
|
92.50
|
89.35 |
| Japanese
Yen |
55.05 |
53.40 |
| As on 12 Oct, 2024 |
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