CII, EEPC worried over hurdles faced by engineering exporters

If rates are not brought under control thenIndian exports will come to a grinding halt, he said.He said the other main problem is the increase inprices of other inputs like corrugated boxes needed forpackaging purposes.Chairman of EEPC Mahesh Desai said the MSMEengineering exports are facing problems as credit is notavailable at the right interest rates.The other two main factors are rise in steel pricesand ocean freights to North America and Europe, he added.Desai said EEPC has requested to make credit availableat Libor plus two to 2.5 per cent.

Leading industry bodies CII and engineering Exports Promotion Council (EEPC) have expressedconcerns about the problems faced by engineering exporters in the last two-three months.

Chairman of the CII committee on Exports and ImportsSanjay Budhia said the engineering exporters are facing tough times due to factors like high steel prices and increased ocean freight.

''Engineering exporters are going through one of themost turbulent and trying times. Out of India's totalmerchandise export of USD 320 billion, the sector contributes more than 25 percent and is one of the biggest employment generators in the country'', he said.

Budhia said, unfortunately, despite being such an important sector, the engineering exporters are now on the verge of losing a sizeable portion of their business to other countries which will lead to large-scale layoffs and permanent closure of factories.

Budhia listed that the main factors causing worry area steep increase in steel prices. He said there has been a continuous increase in steel prices from July 2020 He said engineering exporters should get steel at least 20 percent lower than the current price so that the third sector can be saved.

According to him, the other main dampener is the abnormal rise in ocean freights by 70 percent to 80 percent.

''Shipping lines are operating almost like a cartel and asking freight rates which are never heard of and just not affordable. If rates are not brought under control then Indian exports will come to a grinding halt'', he said.

He said the other main problem is the increase in the price of other inputs like corrugated boxes needed for packaging purposes.

Chairman of EEPC Mahesh Desai said the MSMEengineering exports are facing problems as credit is not available at the right interest rates.

The other two main factors are the rise in steel prices and ocean freights to North America and Europe, he added.

Desai said EEPC has requested to make credit available at Libor plus two to 2.5 percent.