After the effects on global chains due to the covid-19 pandemic and Ukraine war, the agenda of New Delhi’s G20 presidency will place a high priority on providing poor countries with fair and equal access to logistics in international trade. Last year, the covid-19 pandemic and the Ukraine situation drove freight prices to all-time highs.
Almost 200 international meetings will be presided over by India this year after it took over the G20 chairmanship in December of last year. While having no official authority, the presidency has a significant influence on how discussions are conducted on a worldwide level. Around 75% of global trade and more than 80% of the global economy are contributed by G20 members.
For developing nations, the officials will take up issues related to accessibility as a priority.
According to a senior government personnel, western countries are currently in the dominant position in the shipping lines while China is leading the sector of shipping containers. For developing nations, the officials will take up issues related to accessibility as a priority. Accessibility and equity should come impartial to everyone in the logistics business. The official also added that the department will work towards decreasing the costs of logistics. Exporters reported having significant issues after COVID since international freight charges increased by as much as 300–350% from pre–COVID values. In addition, there were significant difficulties due to the unavailability of containers during the supply chain disruptions.
The Federation of Indian Export Organizations stated that the creation of an Indian shipping line with an international reputation is urgently needed because exporters are solely at the mercy of foreign shipping lines and because the nation will have to pay over $80 billion for transport services in 2021. Piyush Goyal, the minister of commerce at the time, had complained about how difficult it was to understand shipping costs. Goyal claimed that the logistics industry had numerous leaks and that shipping costs were not openly disclosed.
The CEO and Managing Director of RBB Ship Chartering Pvt Ltd, Raajesh Bhojwani said that the shipowners were ready to come to India during the covid-29 pandemic. They used to seek a premium of 50% in case they agree. As a result of fewer shipping lines, the company has been dependent on foreign shipping lines. The highest costs from India to the UAE were $1200, but due to a lack of demand, they have since dropped to $50. The government official who was previously mentioned added that incentives for containers that are tied to manufacturing are also in the works.
India needs almost 350,000 containers as per the government, as the demand will keep on increasing.
Every year, India needs almost 350,000 containers as per the government, as the demand will keep on increasing each year due to the export target of $2 trillion by the year 2030. The target has been set by India. The commerce ministry did not respond to a question till the time of publication.
A slowdown in global output starting in the second half of 2022 was predicted by the economic survey as a result of rising inflation and monetary tightening. In 2023, geopolitical tensions, ongoing inflationary pressures, and weak demand are predicted to further stifle global trade, according to the most recent global trade update from the United Nations Conference on Trade and Development (UNCTAD). The growth of global commerce started to decline in the second half of 2022.
As sluggish exports are predicted to continue into FY24, as opposed to the promise displayed at the start of the current year, this is expected to have an impact on several nations, including India.