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'India can boost exports by $5.5 bn by cutting trade costs'
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SME Times News Bureau | 20 Jan, 2017
Industry chamber CII on Thursday said that its recent survey reveals
that reducing costs of trade through digitisation, inland infrastructure
development and an efficient regulatory environment across four
high-growth trade sectors can boost exports by 5-8 per cent.
"A
first-of-its-kind study by Confederation of Indian Industry (CII) and
Maersk reveals that reducing the costs of trade across four high-growth
trade sectors by prioritising digitisation, inland infrastructure
development, an efficient regulatory environment and developmental
training, can boost exports by 5-8 per cent," CII said in a release
here.
"A 10 per cent reduction can boost India's competitiveness
and contribute additional revenues of up to $5.5 billion annually," it
said. "The study called 'Stimulating India's EXIM growth'
reports 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 per cent of the total logistics cost," it added. The
survey findings revealed that while 54 per cent respondents ranked both
regulatory documentation and terminal handling as serious challenges,
between 51-60 per cent of them considered inland transportation a
serious challenge.
"While we need timely and cost-effective
transportation to support trade expansion along with a robust policy, it
is also critical to address challenges like inadequate inland
infrastructure and indirect and hidden costs", Rajeev Sinha, Co-Chair,
CII National Committee on Ports and Shipping, said.
Noting that
outlook for global trade in 2017 remains weak, the report said India
has the opportunity to improve its share of global trade and be the only
country to deliver nearly double-digit growth in container trade this
year.
"Reducing costs by a fourth can substantially boost exports in just these sectors," Maersk Line MD Franck Dedenis said.
"APM
Terminals (India's largest container terminal) in Nhava Sheva (India's
largest container port, near Mumbai) has consistently increased its
container throughout and productivity since 2006 and as a result has
improved India's liner shipping connectivity delivering an additional 9
per cent in trade for the country since," said Maersk Senior Director
(South Asia) Julian Bevis.
Meanwhile, signalling a definitive
reversal of the continuous decline in Indian merchandise exports through
most of last year, official data last week showed these grew for the
fourth month in a row at $23.89 billion in December 2016, an uptick of
an impressive 5.72 per cent over the $22.59 billion in December 2015.
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