EEPC Upset over Rising Primary Steel Price, Container Shortage and Ocean Freight Rates

Engineering goods exports have virtually defied the second wave of pandemic and have remained among the top performing segments with outbound shipment posting a 53% jump in June, 2021 to US$ 9.28 billion as against US$ 6.07 billion in the same month last year.

As per official data released by the Ministry of Commerce and Industry, India’s merchandise exports in June 2021 are estimated at US$ 32.50 billion, as compared to US$ 21.91 billion in June 2020 registering a growth of 48.34%.

EEPC India Chairman Mr Mahesh Desai said that the demand for Indian engineering items is expected to remain robust during the current financial year despite fear of a third wave of pandemic.

"Even if we assume that the third wave of the pandemic looms large, expanding vaccine coverage together with herd immunity and increased awareness about the infection should substantially neutralise it and hence minimum impact on exports," said EEPC India Chairman Mr Mahesh Desai.

"Apart from other policy support by the government, we hope that the refund rates under the Remission of Duties and Taxes on Exported Products (RoDTEP) would also be notified soon providing a level-playing field to engineering goods sector which is one of the largest foreign exchange earners," he added.

The EEPC India Chairman however expressed concern over elevated price of various raw materials especially primary steel, container shortage by some exporters and high ocean freight rates making it tough for the exporters to compete in overseas markets.

"While the strong rebound in global trade has come as a big relief for exporters in general, there are many firms especially MSMEs which are still finding the sailing tough. This reflects in unimpressive credit growth despite a low interest regime," noted Mr Desai.