For the next three months, exports are expected to be slow
Chennai: While exporters are receiving requests from overseas buyers asking for discounts on shipments, the trade is waiting for the Bilateral Trade Agreement before finalizing on discounts.
“Individual exporters are being approached for discounts which vary from 10 to 26 per cent as they cannot pass on the entire additional cost on to the consumers. Some of them want the exporter, importer and the US consumer to share the additional cost due to the reciprocal tariffs,” said Sanjay K Jain, Chairman ICC National Textiles Committee.
However, exporters do not want to rush in and give away discounts. They prefer to wait and go slow with shipments. “We are expecting the Bilateral Trade Agreement to be fast-tracked and the tariffs to come down. If we agree on discounts now, and the BTA comes into effect in three months, we will lose our margins,” he said.
According to him, the biggest problem before the exporters is uncertainty. “We can take a decision only when we are sure that the policy will remain,” he added.
According to Pankaj Chadha, chairman, Engineering Export Promotion Council, if individual exporters give away discounts at this point of time, it will affect the trade.
“We have been asking the exporters within the council as well as other council members to meet and decide on discounts. The discounts have to be uniform across the board,” he said.
US importers have been approaching their trading partners across geographies on discounts. According to industry insiders, China is planning to go ahead without offering discounts to US buyers.
For the next three months, exports are expected to be slow. “We are waiting for some uncertainty in policy and tariffs before going ahead with shipments. Meantime, there could be some decision on BTA,” said Jain.
