The rather unprecedented appreciation of Indian rupee against US dollar during the last couple of months has put the pharmaceutical exporters, for that matter the entire exporting community in the county, in a quandary. On the one hand they are reporting losses from exports due to the rupee appreciation, on the other hand they cannot cancel the exports due to the business commitments.
There are reports of pharma exporters cutting down their exports to markets like China, African countries and some European countries where the losses under this condition are considerable. "Several exporters have cut down their exports to markets like China, Africa and a part of Europe as these markets have become unviable after the appreciation of rupee", Bulk Drug Manufacturers Association (BDMA) president Narayan Reddy said.
The small and medium players are the most affected as they are mostly exporting to these unviable markets like China and Africa. Big pharma manufacturers are mostly exporting their products to the US, which is still sustainable, Reddy said.
In the last couple of months, the rupee has appreciated from around Rs 45 to 41, which comes around 10 per cent deviation. The loss of the pharma exporters can be gauged from the fact the pharma exporters get a margin profit of around 5 per cent from their business.
Meanwhile, the Pharmaceutical Export Promotion Council (Pharmexcil) chairman Dinesh Modi said, the Pharmexcil has already expressed its concerns to the Union government in this regard. "Union Commerce Ministry is negotiating with RBI to find some action to offset the losses due to the rupee appreciation," Modi added.