NEW DELHI: Declining by close to six per cent over the last one year, rupee is now trading at 63.63-70 against 66.93 to a dollar in August, 2016. “So, clearly the external value of rupee has strengthened quite,” the ASSOCHAM Paper said. A stronger rupee has begun to bite exporters, as is evident in the falling pace of growth in shipments. No doubt, exports have been growing for the last nine months ending June , 2017 but as the Reserve Bank of India has also observed that the “export growth weakened in May and June from the April peak as the value of shipments across commodity groups either slowed or declined”.
Exports have shown growth of 4.39 per cent to USD 23.56 billion in June 2017, as compared to USD 22.57 billion a year ago. But this growth had peaked to 20 per cent in April this fiscal. This deceleration in growth is visible in the subsequent months. Moreover, thanks to declining value of dollar, in Rupee terms, during June 2017 exports had shown a negative growth of 0.04 per cent.
While the year on year value of dollar has dropped by about six per cent, the greenback was trading at a recent peak of 68.73 in November, 2016 and the decline from this high has been much sharper at 7.42 per cent.