Indian suppliers of shoes and other products and services destined for export will be able to pay about 2 percent less interest on short-term and long-term loans to finance their production, thanks to new soft loans subsidized by the government. The new measure has been introduced by the Indian Ministry of Finance to help offset the sharp increase of the Indian rupee against the U.S. dollar.
As a result, the interest rate on short-term loans declines from just over 9 percent to just over 7 percent, according to a leading Indian shoe manufacturer.
The declining value of the dollar, which has been less predictable than any trade measures, is having a huge influence on sourcing patterns in footwear. As reported in the previous issues, it is creating big problems for Chinese producers, even though their currency has gone up in value over the last few months.
European importers have been protected by the rising value of the euro, which has to a large extent offset the effect of the new anti-dumping duties on leather shoes from China and Vietnam.