The Indian textile industry, hit hard by recession in the United States and the European Union, said a steep 20 per cent rupee depreciation and the Rs 1,400-crore (Rs 14 billion) package has not helped in boosting sagging exports and demanded that the government should do more to help it come out of the woods.
"The package is expected to bring some relief to exporters, but more concrete measures need to be taken to maintain the growth momentum in the sector," V S Velayutham, chairman, Cotton Textile Promotion Council of India, told PTI.
A weakening rupee was good for exports, but wild fluctuations have done more harm than good, he said.
"The actual fluctuation in the rupee is so wild, that it is difficult to pinpoint what rate to cost a product at. The stability required is not there," Clothing Manufacturers Association of India chairman Rahul Mehta said.
On January 15, Indian currency was strong at 39.26/27 in closing trade. It fell to its multiple year low of 50.60 vis-a-vis the dollar on November 20.
"A substantial slowdown in demand for textile goods from developed countries such as the United States and the European Union, high input cost, liquidity crunch in the domestic market has nullified all the advantages arising out of a weaker currency," Velayutham said.
The Centre, in an economic stimulus package this month, provided an interest subvention of two per cent up to March 2009 for pre and post-shipment export credit for bour-intensive exports (textiles, leather, marine products) and SME sector.