Services exports down 3.3% at $22.54 b in April-May

 India’s services exports declined marginally by 3.3 per cent to US$22.54 billion in the first two months of this fiscal, according to RBI data.

The services exports during April-May 2011 were at US$23.3 billion.Export earnings were also affected as the information technology companies, which accounts for a major chunk in the services export, had to offer discounts to their clients due to rupee depreciation, said experts. Software services companies, particularly into IT and IT-enabled services, have been asked by clients to share their profits because of rupee depreciation, said Director of Indian Institute of Foreign Trade K T Chacko.

“Some sharing has happened on that (rupee depreciation) which is one of the reasons for lesser earnings”, Chacko said.

Meanwhile, fall in the value of rupee against the US dollar resulted in higher outgo for services imports which marginally rose to US$14.22 billion during April-May from US$13.97 billion a year ago. The rupee has fallen by around 20 per cent against the US dollar from a year ago.

Depreciation in the value of rupee also resulted in lower realisation from services like hospitality, education, hotel and tourism, said Rajesh Sharma, Director General of Services Export Promotion Council (SEPC). “Because of rupee depreciation, receipt from tourists, foreign students and tourists fell as they paid less dollars,” said Sharma.

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