Maersk India Trade Report for the July-September quarter of 2019 reveals that the country’s containerised trade has remained flat compared to global growth of 1.5 per cent.

Economic uncertainty, tight liquidity, fall in global export orders, evolving domestic political scenario and currency volatility are said to have affected the flow of investments. While imports witnessed a subdued growth, overall fiscal impact was nullified by an identical contraction in exports, the report notes.

Steve Felder, Managing Director, Maersk South-Asia, attributes the current slowdown to tight liquidity and working capital, weaker domestic consumption and slower global growth.

India’s opportunity

“As the global economy continues to face challenges and trade tensions between major economies ensue, many leading global importers have started to explore trade alternatives to China. The US has emerged as a strong trade partner with India, showing growth in exports (approximately 12 per cent led largely by furniture, vehicles, textiles and apparel) and imports (which grew by 6 per cent driven largely by metals, plastic and rubber).This is expected to provide huge opportunity for India,” observed Felder.

Citing a Commerce Ministry study, he said the ongoing trade tensions between the US and China would offer a huge opportunity for India to export 350-odd products including chemicals and granite.

That said, he brought to mind the government’s ambitious goal of reaching the $5-trillion economy by 2025. “To achieve this, there has to be a focussed approach in implementing reforms and measures to drastically improve land-side infrastructure to boost logistics and adopt digitalisation rapidly. This will catalyse export growth, supported by robust policy reform. An impetus on increasing industrial manufacturing while easing corporate tax structures will favour the Indian economy,” he added.

Related Topics
comment COMMENT NOW