Despite a 16 percent erosion in the value of the Indian rupee against the US dollar, prices of Indian fruits and vegetables remain unchanged. Salim Matramkot
BY MOHAMMAD SHOEB
DOHA: Despite 16 percent erosion in the value of the Indian rupee against the US dollar over the past three months, the prices of Indian goods here remain unchanged, irrespective of the decline in import bills.
Some of the major importers of Indian goods have ruled out the possibility of any respite in the prices even in future even if the rupee continues to remain weak.
Analysts suggest that in principle any depreciation or devaluation of a currency makes goods cheaper for the foreign buyers as they need to pay fewer dollars for imports from that country.
However, leading importers of Indian goods, contrary to experts’ view, say that since the prices in India are rising and the exporters quote them in dollars, the declining value of the rupee should not make any difference.
“The current fall in the Indian rupee will not have much impact on the local prices anytime soon as we source less than five percent of our total imports from India. Secondly, the exporters quote prices in dollars and not in rupees, so it makes no difference,” argued a senior official of a major hypermarket which is a leading importer of Indian products in Qatar.
The value of Indian rupee, over the last three years, has declined by nearly 44 percent since September 17, 2010 (QR1=`12.05) compared to the ongoing exchange rate of QR1=`17.30, but prices of most of Indian items here have not declined.
In fact they have increased by 30-40 percent since then. “I can recall three years ago I used to buy shirts and trousers of some famous brands such as Van Heusen and Louis Philip (Made in India) at the price range of QR130 to QR140 each, but the prices of the same brands have now gone up to between QR180 and QR200,” said Sebastian, an Indian who gave only his first name.
He added: “About 10 years ago, when Carrefour and Lulu started their operations here, the prices of most of the vegetables witnessed a sharp decline due to better competition, but gradually, as the population grew, things have now changed again in favour of traders.”
A senior official at Lulu Hypermarket, who did not want his name in print, said: “As an importer we do not get any benefit out of the weaker rupee as prices are revised quarterly… So whatever the benefits a weaker rupee generates, it goes to exporters.”
The official added: “Although the group imports some perishable items such as vegetables, fish, mutton, beef and others on a daily basis, they are sourced at pre-determined prices.”
“According to the price agreements, the exporters are liable to charge the same price irrespective of the daily rupee-dollar exchange rates. Sometimes they lose and some times they gain, but from our side the prices remain the same.”
Asked if the group is considering to source some new items from India which are currently being imported from elsewhere, he said: “We import items from wherever we find the best prices, but in the case of Indian vegetables the replacement is a bit of challenging.”
Another senior official at Family Food Centre, which is famous for supplying fresh Indian vegetables and household items, said: “I don’t see any impact of the weaker rupee in Qatari prices as the rising prices in India offset the dollar’s gains.”
Contrary to others, some traders do agree with the analysts’ view.
“For the time being I don’t see the weaker rupee impacting our business in Qatar, but once the old stock is renewed, there might be some impact in prices of some items that are imported from some South Asian countries with poor performing currencies,” said Guy Sauvage, CEO of Al Meera.
The rupee has fallen to a new all-time low to 64.50 against the dollar, despite all the measure taken by the government and the country’s central bank (RBI) to arrest the free-fall of the currency. The Peninsula