Agra footwear industry reeling under Chinese currency devaluation shock
However, this booming industry is now facing one of its biggest crises in recent history with the 2 per cent devaluation of Chinese currency Yuan and the consequent decrease in Chinese footwear and accessories which are now flooding the world, capturing Indian markets.
Agra Footwear Manufacturers and Exporters Chamber (AFMEC) Chairman and leading footwear exporter Puran Dawar said that China has devalued its currency to support its exporters and as a result, every Chinese product is available at cheaper prices internationally and Indian products are unable to stand in front of the tough competition posed by China with its lower price-tagged footwear.
Dawar said the Indian footwear industry will not be able to adjust to this decrease in the prices of Chinese footwear and will lag far behind in the international markets, adding that the Chinese footwear is already cheaper compared to Indian footwear and the only advantage India enjoys in the international market is that the Indian footwear is of a better quality compared to what China manufactures.
However, with the prices of Chinese footwear going lower, this slim advantage will be lost and Indian footwear industry will face the brunt of this. Dawar commented that with this devaluation, the price-difference between Indian and Chinese footwear will go from Rs 25 to Rs 60, seriously affecting the domestic footwear industry.
Footwear exporter Nazir Ahmed told India Today that in view of the currency devaluation by China, India should also take reciprocating steps to take care of the interests of footwear exporters. He also said when Prime Minster Narendra Modi had arrived in Agra in 2013 on his electoral campaign, he had promised to do something about the local footwear industry, but nothing was done and the industry is now facing crisis after crisis with no solution in sight.
It was imperative that the government takes corrective measures soon, or the footwear export volume from India is bound to fall drastically in the near future.