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Indian rupee slipping below the record 88 level against the US dollar will enhance price competitiveness of Indian products in global markets and help exporters diversify beyond the US market, say exporters.
According to PTI, However, import-dependent sectors such as gems and jewellery, petroleum and electronics may see lower benefits due to a rise in input costs, they stated.
The rupee breached a record low level of 88 against the US dollar on Friday last week and hit an all-time closing low of 88.18 to a dollar on Monday.
The rupee traded near record levels at 88.15 to a dollar on Tuesday as well. A weaker rupee increases the price realisation of exported products but makes imported products costlier.
Exporters said that the rupee’s depreciation provides a mixed picture for exports.
“On one hand, it enhances the price competitiveness of Indian products in global markets, particularly as exporters diversify beyond the US.
“On the other hand, for sectors with high import dependence such as gems and jewellery, petroleum products, and electronics, the cost of imported inputs will partly offset the currency advantage, squeezing margins,” Federation of Indian Export Organisations (FIEO) director general Ajay Sahai said.
The government is suggesting that exporters, who are dependent on the US, diversify their shipments as 50 per cent tariffs on Indian goods by America may impact Indian exports to that country.
The US accounts for about 20 per cent of India’s exports. It was $86.5 billion in 2024-25 out of total exports of $437 billion.
