Indian export sector could be adversely hit in the financial year 2009 following low demand in the international market. Export sector is facing stiff competition from China as there is substantial gap between prices of Indian products and Chinese products. 

A recently released report by the Federation of Indian Chambers of Commerce and Industry (FICCI) states that cancellation of orders due to low demand and unavailability of cheap funds is a major challenge ahead of Indian export sector.

The report based on survey conducted on 367 exporters maintains, "Indian exporters are on the run by aggressive Chinese pricing behavior. They are facing 'meet the China price' demand from across the market and there is fear that this would intensify in the months ahead." 

FICCI conducted survey of automotive, consumer durables, food and food processing, leather, marine products, gems and jewellery, textiles, IT and pharmaceuticals sector and established that maximum cancellation of orders were reported since September.

The industry body asked for more fiscal measures to maintain adequate growth rate of export sector. Banks should not hesitate to pass low interest benefits by RBI to export companies.

Companies demanded more measure to bail them out from ongoing crisis. Close to 60 per cent of the companies said that they are not going for fresh hiring till improvement in market conditions.