Indian ports forecast to see single-digit volume rise in FY24: Ind-Ra

The anticipated growth rate is pegged at 4 per cent-5 per cent year-on-year in FY24, a significant increase from the compound annual growth rate (CAGR) of 3.5 per cent observed from FY15 to FY23. Key factors contributing to this positive trend include heightened operational efficiency, governmental initiatives aimed at refining downstream logistics infrastructure, and stability in freight rates, as per Ind-Ra.

The global COVID-19 pandemic has indeed disrupted shipping supply chains, but India has risen to the challenge. According to the 2023 logistics performance index (LPI) survey, India improved its LPI rank to 38, up from 44 in 2018. This success is attributed to strategic investments in infrastructure, containerisation of cargo, digitalisation of supply chains, and enhanced connectivity between major ports across the Indian coastline.

The average dwell time (the time a container spends in a port) between May and October 2022 at Indian ports was at par with that of Singapore, currently holding the number 1 rank in the LPI Index.

As global trade lines open and the pressures on supply chains ease, container freight rates returned to their pre-pandemic levels in the second half of FY23. This normalisation is predicted to continue into the third and fourth quarters of FY24.

India's merchandise exports saw a 6.9 per cent YoY growth, totalling $451 billion in FY23. However, the total export volumes fell by 13 per cent YoY to 16.1 billion tonnes. This paradoxical trend underscores the signs of a slowdown in foreign trade between the EU and US economies and India, which together formed 33 per cent and 15 per cent of India's total export and import value in US dollar terms, respectively, during FY23.

The possible continuation of this economic slowdown, or an impending recession in these regions, could negatively impact India's cargo volume growth, particularly in terms of exports.

Fibre2Fashion News Desk (DP)