Coimbatore, Sept. 13 Little did Mr Deepak Shah, Chairman, South India Tea 
Exporters Association, or Mr V. Kumar, President, Karur Exporters Association, 
expect the rupee to cross the 45-mark against the dollar. Both admitted that 
they did not expect the rupee to depreciate to this level.

They sounded upbeat and did not have many words to say when asked to comment. 
Taken by surprise, all that they could merely utter was "it would definitely 
benefit the exporting community".

But the President of Tirupur Exporters Association, Mr A. Sakthivel, maintained 
his cool. He said: "We are happy, but will not be able to reap the benefit 
because the input costs have gone up by 25 to 30 per cent."

forward cover 


Exporters by and large say they were cautioned even when the rupee touched 
39-40 against the dollar. "Most of the exporters have made the forward cover at 
around Rs 40 and would have to honour the forward booking now," Mr Sakthivel 
said.

According to him, at least 35 to 40 per cent of the exporters in Tirupur would 
have taken the forward cover to protect their interest.

Mr Deepak Shah also said most exporters of tea would have booked and not kept 
their positions open. According to him, a majority of the exports was either in 
euro or the dollar. 

Offsetting loss 


Mr Kumar, while conceding that it would benefit the exporters in Karur, said at 
the current level, it would offset the loss suffered by the units because of 
the steep increase in the price of inputs and other issues such as interest 
subvention and duty drawback. 

"Pricing, though, will not have an immediate impact. Exporters would probably 
look at reworking the price on future orders," he said, adding, "even bankers 
have expressed surprise when we asked them how and why the rupee touched 
45-mark against the dollar."

http://www.thehindubusinessline.com/2008/09/14/stories/2008091450990500.htm

Extreme hopes are born from extreme misery. 
- Bertrand Russell 

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