Eu India Dhl in India 2004

8/6/2019 Eu India Dhl in India 2004

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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


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


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


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



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Agenda







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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






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






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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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.



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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

Eu India Dhl in India 2004

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