India requires a shipping line of its own if it wants to be a serious exporter and manufacturer on the global stage, and the budget offers a golden opportunity to get the ball rolling, says Ajay Sahai, the CEO, and DG of the Federation of Indian Export Organizations (FIEO).
Several issues need to be addressed in logistics, and doing so is expected to push up economic growth — all the stakeholders are on the same page about this.
However, Sahai elaborates on a shipping line with a global reputation that can help the nation. Last year, there was a remission of about $86 billion in transport freight charges.
As exports go up, the figure will soon exceed $100 billion. And an Indian shipping line, which fetches 25% of such a business, would save $25 billion a year, explains Sahai.
Almost 90% of worldwide trade is reliant on shipping. This allows shipping majors an enormous hold over worldwide trade.
When they hike the prices, traders and manufacturers have nil or only some options but must pay up.
This makes the goods costlier. For firms in India looking to become a manufacturing hub and a great exporter, the failure to price goods competitively in the global scenario can be a dampener.
In return, this can also blunt initiatives like “Make in India, Make for the World”.
Sahai argues that with India having its shipping line, the country’s manufacturers would never need to depend on any other carriers. This can help evolve Indian goods, making those more competitive.
Besides, the shipping line can also transport for other nations and make some more money for India.
Sahai is upbeat regarding the overall trade scenario and states the services sector, especially, has been performing on a stronger note. They have a significant surplus in this segment.
References: Economic Times, Beams Start