- India’s limited shipping and air cargo control increases vulnerability during global crises.
- High logistics costs during disruptions, like COVID-19 or Red Sea events, strain exporters.
- Relying on foreign transit hubs adds time and cost to Indian exports.
- Strengthening logistics control is key to achieving long-term trade goals like Viksit Bharat 2047.
India must reinforce its shipping ecosystem to reduce vulnerabilities during global disruptions and better support international trade, emphasized Rajesh Agrawal, Special Secretary in the Department of Commerce. Speaking at the CII Export Logistics Conclave, he highlighted the limited number of Indian-flagged vessels, which contributes to an estimated $50 billion trade deficit in the services sector, primarily driven by maritime logistics. Agrawal underscored the need for greater control over global logistics to meet long-term national trade goals, including the Viksit Bharat 2047 vision.
Control Over Logistics Crucial for Trade Stability
Rajesh Agrawal highlighted India’s limited control over both shipping and air cargo capacity, pointing out how this lack of autonomy directly affects export competitiveness during international disruptions. Referring to the COVID-19 pandemic, he noted how shipping costs surged, making it harder for Indian exporters to stay competitive.
He explained that in times of crises—such as the Red Sea situation—logistics costs rise sharply, placing additional pressure on exporters. Countries with stronger control over their logistics systems, he noted, are better positioned to withstand such shocks. Agrawal also gave a practical example: if an Indian container bound for Africa must transit through hubs like Singapore or Dubai, it not only causes delays but also inflates costs, making exports less efficient.
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Source: Business Standard
