The crisis between Russia and Ukraine has scared a sector of the state’s industrialists who do business with these two countries.
Hand tools, nut bolts, machine components, motors, pharma, textiles, and fertilizers are all exported to both of these countries by a number of exporters and importers. Wax and edible oils are also imported.
Exporters may encounter significant delays in receiving paid for items supplied or in transit as a result of the war. Importers that have issued a letter of credit are also likely to suffer losses as a result of the delay in receiving materials.
Amit Goswami, managing director of Euro Forge in Jalandhar, which exports hand tools to both Russia and Ukraine, said a Ukrainian firm had already provided him a letter of credit for 50,000 USD, but he is concerned that it will now be rejected by Indian banks. “Also, there are some exports that are delayed.”
Pharmaceuticals (₹ 812 crore), plastic and rubber products (₹ 268 crore), and iron and steel and related products (₹ 198 crore) are the top three exports to Ukraine. Edible oils and wax are worth ₹10,193 crore, chemicals and minerals are worth ₹1,325 crore, and fertilisers are worth ₹1,976 crore.
According to Amit Thapar, vice-president of the CII Punjab and managing director of Ganga Acrowools Ltd in Ludhiana, the war might wreak havoc on shipping to Europe, which is already strained due to high freight rates. “Exporters with cargo in transit and orders in process would be severely disrupted.” High oil prices are projected to drive up the cost of all oil derivatives, including synthetic fibres. These countries’ imports are higher than our exports, and this would have a negative impact.
These countries’ imports are bigger than our exports, and this would have a negative impact on trade and commerce,” he said.
The All India Trade Forum (AITF) has asked the government to compensate exporters and importers who have suffered losses as a result of the ongoing conflict between Russia and Ukraine.
Badish Jindal, the forum’s national president, has written to the government in Ludhiana, requesting that the government compensate the delay in payments by permitting banks to provide excess credit in the amount of the delayed payment against exports to these nations.
“When we look at the overall economy, Russia and Ukraine account for less than 2% of India’s entire commerce.” However, numerous products associated with Punjab, like as plastic and rubber, clothes, hosiery, fertilizers, farm implements, scaffolding, and hand tools, may have an influence on their exporters and importers,” Jindal added.
India’s overall trade with Russia and Ukraine is ₹55,42,930 crores. From April to December 2021, India’s total imports to these two countries were ₹32,76,838 crores, and India’s total exports were ₹22,66,092 crores.
Russia has a 0.80% proportion of India’s exports and a 1.4% of India’s imports.
India has little commerce with Ukraine, with total exports to the European country being Rs 2,766 crore, or 0.12% of India’s total exports. Similarly, Ukraine imports amount to Rs 14,705 crore, or 0.44% of India’s overall imports.
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https://www.arthprakash.com/ukraine-imposes-a-state-of-emergency-for-30-days
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