'Eurozone crisis hurting India's exports, growth'

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SME Times News Bureau | 15 Nov, 2011
The deepening crisis in the European countries has negatively impacted India's economic growth and is hurting exports as some developed countries have turned protectionist to avoid the downturn, Finance Minister Pranab Mukherjee said Monday.

"If the eurozone crisis prolongs, growth in exports will be impacted," Mukherjee said while inaugurating the 31st edition of the annual India International Trade Fair (IITF) in New Delhi.

The finance minister the recent developments in the European countries have created uncertainties in the global financial markets and it has impacted India's short-term growth prospects.

India's industrial output growth slumped to 1.9 percent in September, the lowest in over two years. Overall economic growth declined to 18 months low of 7.7 percent in the first quarter of the current fiscal.

Mukherjee said protectionist measures adopted by some of the developed countries to avoid the downturn were hurting India's exports.

"The tendency of some developed countries to resort to protectionist measures in the face of downturn of their economy is a matter of grave concern, not only to our exports, but also to the recovery of the world as a whole," he said.

India's exports growth slumped to 10.8 percent in October as compared to 36.3 percent in the previous month and an average of 46 percent growth in the first seven months of 2011-12.

Speaking on the occasion, Commerce and Industry Minister Anand Sharma said product and region diversification strategy adopted by the Indian government and exporters has helped boost India's exports in the recent years.

"The government will continue to work with the industry and traders to improve India's performance at international level," Sharma said.

The 14-day India International Trade Fair, held at Pragati Maidan, the country's largest fair and exhibition venue, is expected to attract nearly 1.5 million visitors and 6,000 exhibitors, official sources said.

The event will host from 26 countries in addition to 27 Indian states, 31 central government ministries and 260 private companies. The theme for this year's event is 'Indian handicrafts - The magic of the gifted hands'.

The first five days of the fair (Nov 14-18) will be reserved for business visitors. The fair will open for general public from Nov 19-27.