India has opportunity to improve its global trade share in 2017: Maersk

Mumbai: Real growth in global trade is expected to hover around 1% to 2% and a weak outlook for 2017 can be foreseen, according to international container shipping company Maersk. However, reducing costs across high-growth trade sectors can give a booster of 5-8% to exports.

“The outlook for global trade in 2017 remains weak. Real growth is expected between 1% and 2%. However, India has the opportunity to improve its share of global trade, especially in exports, through increased competitiveness and be probably the only country to deliver nearly double-digit growth in container trade this year,” Franck Dedenis, managing director – India, Bangladesh & Sri Lanka Cluster, Maersk, said.

The insights were contained in “Stimulating India’s EXIM Growth,” a study conducted by Confederation of Indian Industry (CII) and Maersk.

It further revealed that indirect/hidden costs of trade in textiles, pharmaceuticals, electronics and auto components accrued from unreliable transport services and regulatory/bureaucratic delays are as high as 38%-47% of the total logistics cost and a 10% reduction can boost India’s competitiveness and contribute additional revenues of up to $5.5 billion.

“Indian ports and terminals are well placed to deliver efficiencies and higher productivity. APM Terminals in Nhava Sheva has consistently increased its container throughput and productivity since 2006 and as a result has improved India’s liner shipping connectivity delivering an additional 9% in trade for the country since. We believe terminals can collectively contribute better to lowering costs of trade with certain interventions such as market driven tariff regime, better rail connectivity from ports and reducing middle men or increasing transparency in inland movement of cargo among others,” Julian Bevis, senior director, South Asia, Maersk said.

APM Terminals, a joint venture between APM Terminals and Container Corporation of India (CONCOR) operating from Nhava Seva, JNPT, recently adopted Direct Port Delivery service.

Improvements in regulatory documentation, inland transportation and costs and terminal handling were hailed as the game-changers for the industry in the study.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.