This growth for BRICS was led by India followed by China and is forecasted to gain pace next year as Brazil and Russia are expected to emerge from recession, contributing to higher GDP expansion. Volumes should improve, as GDP for BRICs is expected to increase to 5.7% in 2017, an improvement over the previous forecast of 5.3%. China is expected to grow more than 6% in 2017, India at 8%, Brazil at more than 0.5% and Russia at above 1%.
Economic uncertainty has been a deterrent towards investments in infrastructure that is critically important to help countries lower their supply chain cost and consequently boost exports as well as improve competitiveness.
According to Maersk Line, if a country is able to lower trade costs by 10%, exports can increase by more than 20%. Improving collaboration and increasing trade amongst BRICS nations are some of the key themes expected to be discussed at the BRICS summit in Goa.
“While the year 2016 did not start positively for the world, India clocked growth in the first half of this year. This growth was on the back on strong US economy and recovery in the European market. That being said, it is worth mentioning that trade among BRICS countries continues to grow, although China remains BRICS as well as India’s largest trading partner responsible for 82% of Indian containerized trade. India EXIM trade with BRICS nations has been consistently growing at 4% since 2012”, says Franck Dedenis, Managing Director – India, Sri Lanka & Bangladesh Cluster, Maersk Line.
He further added, “recovery in Brazil and Russian economy is good news for BRICS and it might entail an increase of trade among India and China in 2017. India, Thailand and Vietnam are rising as alternate sourcing markets to China can put some pressure on China in future.”
