The global financial crunch is likely to hit the Indian food processing and agricultural sectors, which were predicted to remain considerably unaffected by the current economic downturn. According to a government official's statement, India's export growth in agricultural and processed food products will shrink to 20% this fiscal from the 46% of the previous year.
S Dave, director, Apeda (Agricultural and Processed Food Products Export Development Authority), said, "Our overall export growth will fall to 20% this fiscal because of the (economic) downturn. In 2007-08, India's overall export growth was 46% and the volume exported was worth Rs 36,000 crore." Export orders have gone down drastically and no new orders were forthcoming, whereas increasing pressure on exports has also made it difficult to achieve the target this year.
Apeda promotes exports of agricultural and allied industries and functions under the Ministry of Commerce and Industry. About international trade volume and export growth, Dave said that India's shrinking exports could be attributed to the significant decline in trading volumes globally. "We don't believe in subsidies or sops. We are, however, trying to get some tax concessions in a bid to help producers. Growth will be there, but significantly lesser. Our annual export growth rate has been between 36-50% over the past 2-3 years," Dave added.
According to the experts, the decline in exports in this sector could also be attributed to the ban on export of rice and wheat. Currently, about 25% of India's exports are to the US, Middle East, Europe and other South Asian countries.
Source : www.fnbnews.com