Month: April 2016

  • It is the year 2016 and the Indian Shipping and Freight industry will undergo a lot of changes, some short term while others may be forever. Here we look at seven major events which will change the industry. 1. China’s Slow down In a nutshell our exports to China will reduce and with cheaper Chinese imports our domestic companies will be hit. However, there is a positive side to it as well, this is making India a more attractive destination for manufacturing. In addition to electronic components, consumer electronics, electrical, equipment, industrial machinery and chemicals, India is also one of the largest markets for project exports from China. Now, if you are in the freight business, strong in China, you should start focussing on the project exports business from China :). 2. Margin Squeeze: big surprise driver for change Freight rates are lowest in the history. However, margins are not entirely dependent on freight rates. With Internet penetrating every aspect of business as an information enabler, it is difficult to earn on arbitrage margins. As a result, most of the freight forwarders are moving into service based models and for some, ocean freight is not a profitable business to be in anymore.  Relationships are shorter, spot quotes are on the rise, customers are more demanding and online sales competition from carriers is squeezing forwarder. 3. Global E-Commerce With Alibaba’s advent in India, people are predicting more international e-commerce players to enter into India. IndianTradePortal.com is also making the discovery of Indian Suppliers easier for international businesses. The Government is pro-actively searching for ways to enable global e-commerce. 4. GST On Imports, along with basic customs duty there will be additional customs duty in lieu of CVD /Excise and the Special Additional Duty (SAD) in lieu of sales tax/VAT will be subsumed...