MSME exporters are worst hit due to increased freight charges and doubled turnaround time; war fatigue appears to have set in says an expert

 Increased freight charges, doubled turnaround time of cargo and steep hikes in insurance premiums have forced small and medium export oriented units to halve their outputs with most presently operating at around 50% of their respective capacities.

Commenting on the challenges which have emerged as a fallout of  the geopolitical and economic turmoil across the globe, Mr. Balkrishan Sharma, Business head and Chief Executive of Yarn Business, RSWM Limited, a leading yarn and knitting fabric manufacturer, said, “Due to the ongoing crisis in Middle East and in Europe, exporters are facing multiple problems that include the non-availability of containers, multifold rise in freight charges and a steep rise in the insurance premium of the cargo.

Mr. Sharma said, “The freight charges have witnessed a massive surge of around five fold to tenfold and the turnaround time has more than doubled..

When asked about the difference in the impacts on big and small players, Sharma told, “As of now, the small players are the biggest sufferers. Unlike the MSMEs, the big players have the financial muscle while the small units are finding it hard to maintain the income flow required to keep themselves afloat.”

 “The Russia-Ukraine conflict has been going on since March 2022 and now war fatigue appears to have set in. The anxiety of war is subsiding and things are cooling down. It may still take another  15 months or 20 months for things to normalise but for this the government needs to take firm steps to safeguard the interests of small players in exporting industries as they are also the major employment generators”, concluded Balkrishan Sharma.