eu india dhl in india 2004
TRANSCRIPT
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The Rise of India in World Trade
Chris Callen, Country Manager, DHL Express - Jan 28, 2004
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Agenda
Indias International Trade Situation
Indias International Trade Situation
DHL Trade Confidence Index
DHL Trade Confidence Index
Building Brand India
Building Brand India
Becoming World Class in India
Becoming World Class in India
International Logistics
International Logistics
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Indias International Trade 2002/03
Exports
US $51.7 billion Growth 18%
next only to that of China at 22%
second highest among worlds 30 leading exporters in world
merchandise trade during the year 2002
Imports
Growth 17.03%
Share of world trade
0.8%
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Getting Ahead
If the present trend continues, we may reach our
often stated goal of achieving 1% of world
merchandise tradeahead of the year 2007
Arun Jaitley
Union Minister of Commerce & Industry
31 March, 2003
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With the rupee rising against theWith the rupee rising against the
dollar and the global slowdown indollar and the global slowdown inworld trade over the past fewworld trade over the past few
months, is there cause for concern?months, is there cause for concern?
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GDP Regional comparison
India has recorded one of thehighest growth rates in the1990s
Among the largest economiesin the world, its GDP is close toUS$ 500 billion
Only China has had GDPgrowth higher than India
7 1
8 6
8 8
1 1
1 4
1 6
2 8
3 5
4 2
4 8
1 , 1 8
4 , 1 4
- 2 0 0 4 0 0 6 0 0 8 0 0 1 , 0 0 0 1 , 2 0 0 1 , 4 0 0
P H
S G
M Y
T H
I D
H K
T W
A U
K R
I N
C N
J P
G D P ( in U S
GDPgrowth,
1990-2001
China 10.0India 5.9
S. Korea 5.7
Indonesia 3.8
Thailand 3.8
Pakistan 3.7
Philippines 3.3
Mexico 3.1
Brazil 2.8
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Merchandise Exports vs GDP
Thailand, Malaysia, Indonesia all export more than India !
- 200 400 600 800 1,000 1,200 1,400
PH
SG
M Y
TH
IDHK
TW
AU
KR
IN
CN
JP
(USD Billion)GDP Exports
23%
10%
9%
36%
18%
117%
44%
57%
39%
101%
45%
142%
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India Rising -- Challenges
WTO, Asean Free Trade Agreement (AFTA), Bi-
lateral FTAs
Ground Infrastructure
Golden Quadrilateral Highway network
New FTZs and enhanced transhipment facilities
Liberalised air traffic rights
Duty structures among the worlds highest
Air Express self-handling elimination ofmonopolies in statutory service providers
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Agenda
Indias International Trade Situation Indias International Trade Situation
DHL Trade Confidence Index DHL Trade Confidence Index
Building Brand India Building Brand India
Becoming World Class in India Becoming World Class in India
International Logistics International Logistics
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How do exporters view the situation?How do exporters view the situation?
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All India
The DHL Trade Confidence Index (TCI) at an all-India level is 61 (Q2-Sep03), up from 58 (Q1- Jun03), driven by a very optimistic 72 points in
general demand conditions.
Factors contributing to this movement include optimistic demand conditions,
better domestic conditions & optimism about the macro-economic state
The factors where no significant change is seen include Attitude of USCustomers, Impact of WTO, Exim Policy & Order Expectations
53
36
72
2111
70
10
20
30
40
50
60
70
80
90
100
Favourable Neutral Less Favourable
Q1
Q2
DHL Trade Confidence Index
The Exporter view on General
Demand conditions, has become
more optimistic, with almost 72%
rating them as favourable as
compared to 53% in the last quarter
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Apparel Sector Confidence among Textile / Garment exporters is even higher: The DHL
Apparel Trade Confidence Index has moved up to 63 (Q2 - Sep03), from 58(Q1-Jun03)
Factors contributing to this upward movement include optimistic Demandconditions, better Domestic conditions, optimism about macro-economic
state & Policy context
DHL Trade Confidence Index
60
33
80
157
50
10
20
30
40
50
60
70
80
90
10 0
Fav ourable Neutral Les s Fav ourable
Q1
Q2
Factors that seem to have moveddown on confidence include Attitudeof US Customers & Impact of NTMs
Optimism in Exporter view of the
General Demand Conditions, shownhere, has moved up to 80% from60% in the previous quarter
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Analysis
So, the DHL Trade Confidence Index moved up by 5% in Q2-Sep03, despitethe fact that month on month, export growth began to slacken. Dr Debroysview of the possible reasons for this apparently paradoxical finding include:
- Time lag in perceptions reacting to objective reality
- Better domestic conditions biasing the results
- Exporters are unduly optimistic about seasonal demand conditions
The upward movement in our Index can be ascribed more to better domesticeconomic conditions & this has negated the impact of certain negativedevelopments internationally
But there is no reason to despair even if we get 8% growth in 2003-04 it
will be respectable and the target of 1% share of global trade appearsfairly modest
DHL Trade Confidence Index
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Agenda
Indias International Trade Situation Indias International Trade Situation
DHL Trade Confidence Index DHL Trade Confidence Index
Building Brand India Building Brand India
Becoming World Class in India Becoming World Class in India
International Logistics International Logistics
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Emerging Trends
Growing cross-border trade
More cross-border production to take advantage of lowercosts/new markets
Greater liberalisation of trade policies & tariffs through WTO
Major shift by global companies to source, produce and
distribute from emerging economies like India Greater need for dedicated air express freighters
Less reliance on under- floor space of passenger aircraft &
dictated schedules
Enhanced schedules to meet shortened transit times
Courier Air Express
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Emerging Trends
Challenge of Breaking the Time Barrier Further
Businesses demanding faster and more time-definitedeliveries
Need shortest Time- to- Market
Shorter Product life cycle
JIT processes and express transport key to supply chainlogistics
Lower inventory holdings
Greater outsourcing of logistics services to integrators,
3PL/ 4PLs
Air Express Logistics Solutions
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Agenda
Indias International Trade Situation Indias International Trade Situation
DHL Trade Confidence Index DHL Trade Confidence Index
Building Brand India Building Brand India
Becoming World Class in India Becoming World Class in India
International Logistics International Logistics
Th P h Ah d
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The Path Ahead
Is India is at a point of inflection where it can take a significant
share and role in world trade? There is no better time to be an Indian in this world
Two things critical for India to go forward strongly :
Position India as a good place to do business in
Position India as a place for manufacturing excellence These two are not easy-wins since the task is not one of
positioning alone at least in many key sectors
In marketing terms India is not at the stage for aggressivebranding but a stage for solid product development
But brand is very important not at the country level but at theindividual company level
B di
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Branding
What came first : Sony or Japan, LG or Korea ?
Building world-class brands is the responsibility of each andevery business and the country has a smaller role in it
The country responsibility is In making India an easy andgood place to do business with ! (whether it is for Indiancompanies or MNCs)
Infrastructure, labour reforms, primary education, borderlessstates, debilitating levels of corruption all of them need tobe managed with a far greater urgency.
Individual companies will get enormous opportunities in the
world market as trade barriers topple around the world.
Q t i A l & t til T d
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Quotas in Apparel & textile Trade
Chinas growth has been spectacular in areas where quotas haverecently been removed by USA (Source : US Intl. Trade Commission)
For example :
Bras & foundation garments (Category 349/649) : 232 %
Knit Fabrics (Category : 222) : 21,976 %
Infant wear (Category : 239) : 826 %
Robes and dressing gowns (Category : 350 /650) : 540 %
Clearly, as trade regimes liberalise worldwide, new opportunities willopen up for businesses which have world class manufacturing excellencewith vertically integrated skills!
Dont bother too much about Brand India, focus on building world classmanufacturing excellence in our individual businesses grow your ownbrand!
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Agenda
Indias International Trade Situation Indias International Trade Situation
DHL Trade Confidence Index DHL Trade Confidence Index
Building Brand India Building Brand India
Becoming World Class in India Becoming World Class in India
International Logistics International Logistics
Asia Pacific Logistics O er ie
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Asia-Pacific Logistics Overview
Mar
kets
Hong KongSingaporeJapanAustraliaNew ZealandKoreaTaiwan
Mature
China
Unique
Malaysia
Thailand
Indonesia
Philippines
India
Mid-Level
Sub-ContinentVietnam
Cambodia
Laos
Myanmar
Etc
Developing
Developed
Logistics High Competition High Service
levels Lead time
pressure Lower Growth
Rapid
Development Undeveloped
domestic Increasing
service levels High Growth
Developing
sophistication Increasing
competition Increasing
service levels Varied Growth
Poorer
infrastructure Lower
competition Customs Ownership
Issues High Growth
Ch
aracte
Building a Strong Infrastructure
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Building a Strong Infrastructure
Four Gateway Strategy four state-of-the-art Express Handling Unitsfor seamless self-handling of Air Express shipments at major airports
First 26,000 sq ft facility now operational in New Delhi; onlydedicated facility of its kind in India
Similar facilities planned in Mumbai, Chennai and Bangalore
12 Spare Parts Centres across major cities
Modern, technologically superior Service Centres 300-strong fleet of new vehicles, the largest of its kind in India, linked
in real time to our data network.
Globally integrated sophisticated IT infrastructure for real time supplychain management and tracking.
24-hour country-wide toll-free customer service call centre.
Building a Strong Infrastructure
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Building a Strong Infrastructure
Like you, many challenges we face are regulatory orbureaucratic some we have overcome, some we are still
battling, most of are unique to India: On-board-courier
Gateways at Airports
24-hour Customs in-premise
Indian Post Office (Amendment) Bill, 2002 Our investments are significant and we hope to provide the
kind of logistics support which is truly world class. Weregetting there.
We are leading the way we have 70% of the international airexpress market in India, and over 20,000 exporters andimporters in our customer base here !
Invest, excel, promote.
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sTHANK YOU