NEW DELHI: Indian apparel exporters are likely to reap benefits of depreciating rupee against the dollar. Rupee has declined more than currencies of competing countries such as China, Vietnam and Bangladesh.
Since Chinese currency – yuan – was first devalued on August 10, rupee has recorded its sharpest depreciation among its competitors including China, Vietnam and Bangladesh. Since August 10, rupee has depreciated by 4.63% to 66.83, while yuan (renminbi) is down 2.51% to 6.37 against the dollar as of Monday. Among other competing countries, Vietnamese dong slumped by 2.96% to 22468 against the dollar on Monday from 21823 dong on August 10.
On the other had, Bangladesh’s currency appreciated by a negligible 0.06% to 77.73 on Monday against the dollar from 77.78 on August 10.
“Indian apparel will be more competitive. The quantum of competitiveness, however, would depend upon relative currency movement of the major apparel exporters such as China, Bangladesh and Vietnam,” said Rahul Mehta, President, Clothing Manufacturers’ Association of India (CMAI).
Meanwhile, overseas buyers would immediately start re-negotiating terms of existing contracts.
