The recent volatility in value of rupee against dollar has made foreign companies to postpone their orders, thus adversely impacting India's exports, said Mr Aman Chadha, Chairman, Engineering Export Promotion Council of India (EEPC).
“Despite the global slowdown, we have not faced any cancellation of shipments, but the buyers are more happy placing monthly orders than the usual practice of three to four months,” he said.
Besides avoiding inventory, he said they also want to negotiate better price by taking advantage of rupee depreciation. India's engineering exports fell 38 per cent to $3.78 billion in November. In fact, the slide started with a fall of 0.92 per cent in September and seven per cent in the following month on the back of global economic slowdown.
Exporters prefer a stable currency to decide on pricing. In a bid to overcome slowdown in the US and European markets, EEPC has been exploring newer markets such as Africa, Latin America, Colombia and Asean (Association of Southeast Asian Nations) countries. Both the US and Europe accounts for 40 per cent of India's engineering exports.
INDIA SOURCING
With substantial slowdown in exports, EEPC has for the first time tied up with the Maharashtra Government to host a sourcing event ‘India Engineering Sourcing Show 2012' between March 22 and 24. Mr Chadha said the event will not only promote Brand India, but also create awareness and benefit Indian entrepreneurs, particularly in the micro, small and medium enterprises (MSME) sector.
EEPC expects 800 foreign companies to participate in the event with close to 300 Indian companies including companies from the public sector from the northern region, Maharashtra and Gujarat showcasing their strengths.
“The event will benefit both India and the participating countries. Besides sewing up long-term contracts, Indian companies can also look to attract investments if they can convince foreign investors in the Investment Forum, which is part of the event,” he added.
Some of the power and infrastructure projects have attracted foreign investors. The B2B event will give an opportunity to the Indian companies to explore business alliances globally through joint venture or vendor development programmes, technology transfers or on the spot booking of export orders with leading industry heads, he said.