India to lead global economic growth in Q2 2019
The DHL Global Trade Barometer, an early indicator of global trade developments calculated using artificial intelligence and big data, revealed that India’s trade growth outlook — coming in at 59 points on the index — will be driven primarily by an uptake in both imports and exports of Personal Household Goods, Temperature or Climate Controlled Goods and Land Vehicles & Parts, which increased in index points by 19, 16 and 2 respectively. However, India’s ocean trade dropped sharply by almost 20 points to 63, while air trade is also expected to stagnate in the coming quarter.
“India has not been immune to the current global economic climate, but businesses operating in the country can afford to remain positive: despite increasing headwinds, India has managed to maintain the highest predicted trade growth of all the GTB countries,” said Kevin Leung, CEO, Global Forwarding Asia Pacific. “With its annual GDP growth rate still running at an impressive 7.5%, India remains somewhat insulated from global trade volatility thanks to high domestic private consumption, which accounts for 60% of the country’s GDP and is expected to generate up to $6tr in opportunities for growth. It’s no surprise that the personal household goods sector is seeing a steady increase on the ocean import side, while a decrease in air exports of consumer fashion goods appears to have been largely offset by high domestic consumption.”
The Barometer’s results also suggest that global trade growth looks set to slow down over the next three months, signalling only a slight growth. However, the top three nations with the highest indexes are all in Asia, namely India, Japan, and China. Indices for all seven countries that constitute the Global Trade Barometer index — including the US, UK and Germany — are above 50 points except for South Korea. In the Global Trade Barometer methodology, an index value above 50 indicates positive growth, while values below 50 indicate contraction.
Launched in January 2018, the DHL Global Trade Barometer is an innovative and unique early indicator for the current state and future development of global trade. It is based on large amounts of logistics data that are evaluated with the help of artificial intelligence. In order to make this valuable data accessible for academic research and to increase the macroeconomic significance of the indicator, DHL recently entered into research cooperation with Eswar S. Prasad, professor of Trade Policy and Economics at Cornell University in Ithaca, NY, USA. The indicator is published four times a year and the next release date is scheduled for June 2019.
