The depreciation of Indian currency is a boost for export of garments but for a short term. It is being said that this depreciation will be good for the export industry only if the situation continues for a longer period.
The rupee plunged to a record low of 66.246 against the US dollar on November 8 before recovering to settle at 68.395 on December 1. One of the reasons for the decline in value is outflow of money from prospective foreign investors. As Ajay Sahai, Director General and CEO of Federation of Indian Export Organisations comments the fall in Indian rupee is good news for exports industry and with the rupee depreciation and rise in dollar value, improvement in export of garments is expected at least for short run. But the country will be at loss if there is greater fall in values of currencies from other major emerging markets.
Raja Shanmugham, President, Tirupur Exporters’ Association feels the depreciation of the Rupee has definitely helped garment-oriented exports. However, the gain is only for a short-term as we have been experiencing this kind of situation since the last few years when the rupee falls by the year end and the value begins to increase within a few days. Hence, most
