Germany recession may impact Indian exports: CII EXIM committee chairman

Economic recession in Germany is likely to impact India's exports from various sectors, Chairman of the CII Committee on EXIM Sanjay Budhia has said

Private sector likely to get limited access to Gati Shakti portal

New Delhi

Listen to This Article

Economic recession in Germany is likely to impact India's exports from various sectors like chemicals, machinery, apparel and electronics to the European nation, Chairman of the CII Committee on EXIM Sanjay Budhia has said.
He, however, said that it is too early to see the impact of the economic recession in Germany on India's exports.
Germany, the world's fourth-largest economy, is facing recession as its GDP fell 0.3 per cent in the first quarter of 2023, following a decline of 0.5 per cent in the fourth quarter of the last year.
In 2022, 4.4 per cent of India's total exports were to Germany, concentrated mainly in sectors like organic chemicals, machinery, electronics, apparel, footwear, articles of iron and steel and leather goods.
Even though it's too early to see the impact of Germany's recession on India's exports, the sectors mentioned above will likely be the ones most affected, he told PTI.
He said the entire European Union is dealing with the rising energy prices that have led to recession in Germany for two consecutive quarters.

Also Read

Germany enters recession: What went wrong with Europe's largest economy?

Hockey World Cup final, Germany vs Belgium: Germans out to stop Red Lions

Biggest challenge is to get Centre, states work together: CII president

Shankar Vanavarayar becomes chairman of CII Tamil Nadu State Council

Fifa World Cup: Giant killers Japan scalp Spain, Germany out in group stage

Angel tax: Experts seek 10% safe harbour for convertible preference shares

Negotiations on supply chain agreement under IPEF conclude: Ministry

FII inflows, improving macros make India May's best-performing market

FPIs invest Rs 37,316 cr in May on strong domestic macro fundamentals

Delayed hydropower projects push up costs by over Rs 30,000 crore

With its largest economy entering into a recession, the EU as a whole is bound to feel contractionary pressures as well. Around 14 per cent of India's total exports is to the EU, with Germany being the top destination of Indian exports, followed by Netherlands, Belgium, Italy, and France, he added.
Citing a report, he said the think-tank Global Trade Research Initiative (GTRI) has estimated that the recession will impact India's exports of value USD 2 billion, including products like smartphones, apparel, footwear and leather goods.
On investments from Germany, he said that a recession in the European nation might have an impact on its investments in India. However, it is likely that German companies may seek cheaper alternatives during recessionary conditions.
This can lead to minimal effects on German investments in India, Budhia added.
Looking at India's FDI from 2000 to 2022, Germany ranks 9th in the total FDI inflow, and it has cumulatively invested over USD 13.6 billion in areas like transportation, electrical equipment, metallurgical industries, services sector (particularly insurance), chemicals, construction activity, trading and automobiles.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: May 28 2023 | 2:49 PM IST

Explore News