A sustained depreciation of the rupee against the greenback in the wake of the Russia-Ukraine crisis will help exporters considerably in sectors where reliance on imported raw materials is limited. However, the sectors (including petroleum, gems and jewellery and electronics) where domestic value addition is limited, may have only limited relief, trade experts and exporters told FE. But if the domestic currency sees sharp volatility, as it has in the past two days, the gains could be negated. Benefits to domestic exporters also hinge on the movement of currencies of India’s competitors in the global market. The domestic currency had weakened by about 1.5% against the dollar this year until Thursday, when Russia undertook military operations in Ukraine. However, the rupee pared some losses on Friday and gained 0.6%. Still, the domestic currency has weakened slightly more this year, against those of some other nations (see the chart). Importantly, according to the RBI’s real effective exchange rate (REER) index, based on the export-weighted average of about three dozen currencies, the rupee was “over-valued†by over 4% in January. Ajay Sahai, director general and chief executive at apex exporters’ body FIEO, said: “While, as a thumb rule, the rupee depreciation will help our exporters, at the same time, we have to see the level of depreciation of the currencies of those countries that we compete with in the export market.†Noted textiles expert DK Nair said the depreciation, if sustained, will “help our exporters, especially in sectors like textiles and garments where our dependence on imported raw materials is minimalâ€. Raja M Shanmugham, president of the Tirupur Exporters’ Association, too, concurred with the view. The rupee depreciation will help only if it sustains for a longer period. Mahesh Desai, chairman of the engineering exporters’ body EEPC, said the impact of currency depreciation will come with a time lag. Merchandise exports can potentially cross the ambitious target of $400 billion set for the current fiscal, commerce and industry minister Piyush Goyal had said on Thursday. Exports had shrunk 7% in FY21 from a year earlier to $292 billion in the wake of the pandemic. However, global demand for goods improved dramatically this fiscal following an industrial resurgence in advanced economies.