Rate hike by RBI is big negative for exporters feels EEPC India
The 25 basis points increase in the interest rates by the Reserve Bank of India today is a big negative for exporters , as they would become less competitive in a tough global market that is already facing the threat of tariff war, said EEPC India chairman Ravi Sehgal .
"While the RBI governor Dr Urjit Patel has himself pointed towards increased global risks including the trade war and widening trade deficit , making higher export growth imperative, the rate of borrowing has been moving up. That is certainly not a good news for exporters," the EEPC India chairman said.
He said , in fact, the cost of borrowing is adding to overall cost of production for exporters, particularly in the engineering sector, due to rising prices of raw material like steel.
Sehgal said , if the GDP growth has to be pushed up to the levels as estimated by the RBI, the exporters need to be supported , like their competitors are in countries like China.
"While the RBI governor Dr Urjit Patel has himself pointed towards increased global risks including the trade war and widening trade deficit , making higher export growth imperative, the rate of borrowing has been moving up. That is certainly not a good news for exporters," the EEPC India chairman said.
He said , in fact, the cost of borrowing is adding to overall cost of production for exporters, particularly in the engineering sector, due to rising prices of raw material like steel.
Sehgal said , if the GDP growth has to be pushed up to the levels as estimated by the RBI, the exporters need to be supported , like their competitors are in countries like China.