India looks to increase shipping fleet and container manufacturing

Monday, 21 October 2024 00:44 - - {{hitsCtrl.values.hits}}

The Centre is taking steps to reduce losses by increasing the size of the Indian container production capacity and bolstering the domestic shipping fleet, as global shipping rates doubled in September of this year due to the ongoing Middle East war.

The source claims that the necessity of expanding the shipping fleet and enhancing container manufacture is clearly acknowledged at higher levels. There are ongoing interministerial activities in the areas of finance, shipping, and trade. We currently export $ 450 billion. In 2004, China was worth $ 450 billion. They didn’t reach $ 3 trillion for 20 years. Building up the fleet and container capacity occurred at a specific point in expansion, and that time is now for India.

According to an official, Indian exports, particularly low-margin, high-volume goods like textiles, may be impacted by the conflict’s intensification due to Iran’s active involvement.

As shipping costs remained “more than twice as high” as they were a year ago, the World Bank’s trade monitoring report, which was published earlier this week, said that global supply chain stress remained high through September 2024 due to disruptions in West Asia, the Mediterranean, and Asia. Amid a spike in freight charges, Indian exporters have been pointing out that international shipping lines are increasingly refusing to assign slots, according to a piece published last month by The Indian Express.

When Hamas’s strike occurred in October 2023, the World Bank’s Global Supply Chain Stress Index, which measures delayed shipping capacity, increased by 72% to 1.4 million twenty-foot equivalent units (TEUs) in September 2024.

Indian exporters have been pleading with the Government to support the establishment of a globally recognised Indian shipping line ever since the Red Sea crisis started. The request is made at a time when India’s exports are driving up outward remittances for transport services. As a transport service charge, traders sent more than $ 109 billion in 2022.

According to exporters, an Indian shipping line will “reduce arm-twisting” by international shipping lines, especially against Indian MSMEs.

Notably, the Red Sea situation is causing international shipping firms to see a sharp increase in revenues. Considered a gauge of global trade, the Danish giant Maersk increased its profit projection in August for the third time since May, citing strong demand for container shipping and higher freight prices brought on by the Red Sea issue.