India's container trade growth slowed to one per cent on account of various factors like growing trade tensions and slump in manufacturing sector, logistic firm AP Moller - Maersk said on Monday. Besides, rural distress also impacted overall import-export growth, it added.
"India's containerized trade growth slowed to 1 per cent (9 per cent in the same period last year) in Q2 2019, due to a cocktail of international factors such as slowing trade growth, and growing trade tensions – coupled with domestic factors like rural consumer distress, tightening liquidity and a slow-down in key manufacturing sectors," the company said in a statement.
West India delivered the highest growth with imports growing at 4 per cent and exports at 11 per cent, while North India delivered 1 per cent growth in imports and reported a steep decline of 9 per cent in exports, it said.
"South India registered 1 per cent import growth and 2 per cent export growth, while East India recorded 2 per cent growth in imports and contracted by 1 per cent in terms of exports," the statement said.
India's exports to China declined by 20 per cent, led by a reduction in demand for India-made textiles & apparel, which were large export commodities in the corresponding period last year.
At the same time, imports from China contracted by 22 per cent, it said, adding the increasing economic cooperation between India and Saudi Arabia led the latter to emerge as one of India's strongest export partners in Q2 2019, growing by 74 per cent, with vegetables and tiles, stone & glass exports from India leading this growth.
"The overall deceleration of trade growth reflects a broad-based slowdown across key economic sectors. Amidst increasing global volatility, a slower local economy and the USA's withdrawal of preferential access for certain Indian products, India's import-export trade is expected to continue to face headwinds in the coming months," Steve Felder, MD, Maersk South Asia said.
However, the commerce ministry's recently proposed export promotion scheme, a production-based support scheme, coupled with a weaker rupee, is expected to boost Make in India and benefit multiple industries, he said.