India's Planning Commission looked increasingly unlikely to reach ambitious targets for the expansion of its national commercial shipping fleet, according to a report from The Economic Times (ET) at the end of April. BMI notes that India's shipping industry is less developed than those of many other nations in the Asia Pacific region, and it looks unlikely to make any great advances in the short term. The Planning Commission hopes to increase India's fleet to 12mn gross tonnes by 2012 in order to maintain the 14% share of domestic shippers currently operating on India's international trade routes. According to the ET, the fleet totalled 9.28mn gross tonnes as of April 2009, indicating that an additional 2.7mn gross tonnes would be needed between 2009 and 2012 to meet the target. The ET suggests that such an increase is unlikely given that the country's fleet increased by just 130,000 gross tonnes in 2007 and 400,000 gross tonnes in 2008, while it decreased by 27,000 gross tonnes between January and April 2009. Meanwhile, the country's largest shipping line, state-owned Shipping Corporation of India (SCI), has been forced to scale back a five-year US$4bn fleet expansion programme due to a funding shortfall. BMI notes that India's shipping fleet, which totalled 501 vessels in 2008 according to the CIA World Factbook, ranks behind that of neighbours Indonesia, Japan and South Korea. Moreover, the average age of the fleet is thought to be considerably above those of its neighbours, with the ET estimating the average age of an Indian ship at 18 years.
BMI's India Freight Transport Report concludes that the country will reach average annual freight-traffic growth of 7.6% in the 2009-2013 period across all freight modes. In spite of the global economic slowdown in 2009-2010, we still see a solid foundation for freight-transport industry growth. We have adjusted some of our mode-specific freight turnover forecasts. On the shipping side, we edged down the forecasts to take account of lower growth in world trade. We have also reduced the airfreight forecast, in view of the fall in demand and financial difficulties faced by the industry. According to our latest estimates, transport and communications GDP rose by 7.0% in 2008, 0.7 percentage points faster than overall GDP, which we estimate to have increased by 6.3%. For the 2009- 2013 forecast period, we expect the transport and communications sector to continue outpacing the economy as a whole by a small margin. We forecast that the sector will achieve average annual growth of 6.6%, versus 6.5% for overall GDP. The total value of transport and communications GDP will rise to US$152.2bn in nominal terms by 2013, representing 7.7% of India's GDP.
BMI's India Freight Transport Report concludes that the country will reach average annual freight-traffic growth of 7.6% in the 2009-2013 period across all freight modes. In spite of the global economic slowdown in 2009-2010, we still see a solid foundation for freight-transport industry growth. We have adjusted some of our mode-specific freight turnover forecasts. On the shipping side, we edged down the forecasts to take account of lower growth in world trade. We have also reduced the airfreight forecast, in view of the fall in demand and financial difficulties faced by the industry. According to our latest estimates, transport and communications GDP rose by 7.0% in 2008, 0.7 percentage points faster than overall GDP, which we estimate to have increased by 6.3%. For the 2009- 2013 forecast period, we expect the transport and communications sector to continue outpacing the economy as a whole by a small margin. We forecast that the sector will achieve average annual growth of 6.6%, versus 6.5% for overall GDP. The total value of transport and communications GDP will rise to US$152.2bn in nominal terms by 2013, representing 7.7% of India's GDP.