Government’s decision to ban use of old Rs 1,000 and Rs 500 currency notes is expected to impact adversely the growth of export-import (EXIM) trade, shipping giant Maersk Line said in a report. “Trade wise, Maersk Line expects India’s EXIM growth in the fourth quarter (October-December) to be slower than third, as a result of the demonetisation exercise undertaken by the government in November this year,” the global containerised division of the Maersk Group said in a statement.
Watch What Else is Making News
“Limited availability of new currency in the hands of people will impact exports in sectors like agriculture due to high number of cash transactions,” Maersk Line Managing Director (India, Sri Lanka and Bangladesh Cluster) Franck Dedenis said.
However, such initiatives are aimed at helping government realise its long-term goal of improving infrastructure and introducing regulatory framework. This can ease business operations, simplify taxation system, boost demand and promote transparency in the country, he added.
On the outlook for 2017, the India Trade Report said while prices are at an all-time low, through investments in capacity and service offerings, shipping lines are helping Indian products stay competitive worldwide.
“In 2017, Maersk Line predicts the worldwide container shipping demand to grow by about 1-2 per cent. However, India could easily quadruple the global demand and be the only country amongst the emerging economies to show such growth next year,” it added.
Maersk Line in India is a leading container shipping line with footprints across 25 offices, 55 Inland Acceptance Points and presence across 16 ports in India.
“The future looks promising for India. Overall, Indian trade is set to maintain double digit growth in 2017, in contrast to the market challenges of the neighbouring countries led by China and the bleakness of the global trade,” the report said.
WTO has forecast a further shrink in world trade growth from 2.8 per cent as predicted in April this year to 1.7 per cent in 2016, it added.
“This is the first time in 15 years that international commerce is expected to lag growth of the global economy, signalling the first reversal of globalisation since 2001 and only the second since 1982,” the report said.