Currently exporting has become a really difficult affair for Indians. Difficulties and challenges, again and again, demotivates the exporters and hinder the growth of Exporting Business. Here are a few challenges faced by Indian exporters.
- Economic Decline in International Market
The international market addressed the economic decline in 2008 and a half year of 2009. In 2008, when the United States faced a major subprime crisis of giving loans to borrowers who didn’t have the capacity to payback the economic decline or recession got worse. Due to this drastic decline, the demand for gems and jewelry, clothing and textiles decreased to many folds. With the decrease in decline, the demand decreased too. Exporters started quoting lesser amounts and leading to fewer profits and even loses.
2. The Difference in Well Equipped Machinery
Well developed countries used their high-class technology and machinery to produce goods and services at a faster and better rate. On the other hand, still developing or underdeveloped countries still used old-fashioned and out of date machinery because of the lack of enhanced equipment and technology. This led to slow and lower development in the global market.
3. Extreme competition in International market
When it comes to competing in the global market Indian Exporters face a lot of problems. The competition is of cost, quality of products, high tech machinery, and margins on sales. Indian exporters not just face problems in the global market but in their own country as well like problems faced by neighboring state exporters, local producers who remain where the goods are being exported. These problems create exporting challenging.
4. High-Quality Standards
India is a developing country and faces a lot of challenges when it comes to quality products. As developed countries expect standard quality products and when they import products from developing countries like India, they perform safety tests to ensure the quality of the product. Many times the products especially degradable or perishable products get rejected due to poor quality or high level of toxicity. Because of these reasons exporting of India loses the global market.
5. Rise and fall in different currencies
Just like India has rupee as its currency in the same way other countries have their own currency like Australia has Australian dollar, United States has the dollar as currency, the United Kingdom has pound as currency and many more can be added in this. Just as every country as individual currency the same way they have different value too. The value of the currency fluctuates from time to time which is a threat to Indian exporters. Indian rupee faces making problems while making payments in order to pay for imports Indian currency is converted to the international currency which costs a lot while paying.
6. Risks and Dilemma
Exporting is a business which involves a lot of risk and threat. Risks can be of any type it can be political as well as commercial. If we talk about political risks they can lack the support of the government, environmental risks exposed to exporters due to misuse of resources and many more. Commercial risks involved in exporting are currency-related issues, rejection on quality by international importers and so on.