Tags:
Journalism of Courage
India may lose the Russian market to China and European countries after ‘rupee-rouble debt repayment arrangement’ between the two countries ends in 2004.
A survey of India Inc conducted by Federation of Indian Chambers of Commerce and Industry of India (Ficci) says “exports will head downward once the rupee-rouble trade agreement comes to an end.” Over 29 per cent respondents feared greater competition while 19 per cent apprehended greater credit and foreign exchange risks. Another 19 per cent of respondents feared difficulties in carrying out operations post rupee-rouble trade arrangement. “Notwithstanding the friendship of yesteryears, Russia now means business. Unless we take immediate steps, we may lose an emerging market,” a Ficci official said.
The bilateral trade between the two countries declined by 6.4 per cent in 2000-01 to Rs 6,400 crore from Rs 6,700 crore in 1999-2000. Between April 2001-September 2002, the bilateral trade between the two parties remained at Rs 3,060 crore, an over 12 per cent decline compared to the same period previous year.
“For Indian exporters, rupee-rouble trade arrangement was the safest mode of trade with Russia. Presently about 85 per cent of Indian exports are financed through debt repayment route,” the Ficci official said adding that the trade would decline considerably after 2004. “High freight cost is one of the major factors which will dissuade Russia to import products from India, ” he said adding that China had about $12 billion trade with Russia whereas bilateral trade between India and Russia was a mere $1.4 billion. Ficci is sending a 25-member CEO delegation to Moscow from February 17-19 to market India, he said.
