70% of India’s top export destinations face economic slowdown: PHD Chamber

Exports projected to grow at 9-10% in 2016-17

Though a ray of hope is emerging with dynamic efforts undertaken by the Government in improving the ease of doing business and reforms in the export infrastructure but economic slowdown in 70% of India’s export destinations is a major challenge to India’s exports growth, said Dr. Mahesh Gupta, President, PHD Chamber of Commerce and Industry in a press statement issued here today. 

Notwithstanding, slowdown in destination economies, dynamic reforms undertaken at domestic front vis-a-vis improvement in ease of doing business has potential to post a 9-10% exports growth in the current year 2016-17, said Dr. Gupta

The incremental growth rate (increase in growth rate over the growth rate achieved in previous year) is negative for most of the destination economies including USA, UK, UAE, Hong Kong, China, among other major export destinations.  

The GDP growth rate of US is projected to decline from 2.4% in 2015 to 2.2% in 2016, UAE growth is projected to decline from 3.9% in 2015 to 2.3% in 2016, Hong Kong is projected to decline from 2.36% in 2015 to 2.15% in 2016, China is projected to decline from 6.9% in 2015 to 6.6% in 2016 and growth of UK is projected to decline from 2.2% in 2015 to 1.7% in 2016, according to the World Economic Outlook of IMF

Global trade growth is also projected to remain sluggish at 2.8% in 2016 showing no change from 2.8% in 2015. So will be the demand scenarios of these economies and growth of our exports towards these economies, said Dr. Mahesh Gupta

Going ahead, India should focus more on the promising growth economies such as emerging and developing economies as economic growth is projected comparatively higher in many of these economies.

The emerging and developing economies have been projected to grow from 4% in 2015 to at a rate of 4.1%  in 2016 and 4.6% in 2017 which is significantly high in comparison to the growth rate of advanced economies at 1.9% in 2015, 1.8% in 2016 and 2017.

Growth scenarios indicate higher prospectus  for growth of exports in the emerging and developing economies.

Enhanced focus on emerging and developing economies particularly economies in Asian  and African region will help India to achieve at  around US$290billion exports with a growth rate of 9-10% in 2016-17 over the US$264billion exports 2015-16.