: Steady improvement in 2014 Indo-German Trade According to the provisional figures published by the Federal Statistical Office, Wiesbaden, after Indian imports from Germany falling 11.5% and Indian exports declining 1.5% during the year 2013 over the previous year, there was a steady improvement in imports from Germany during 2014, which posted only a -2.9% change over 2013, while Indian exports even registered a growth of 2.1%. In April last year, Indian imports from Germany was lowest with -15.2% change over the same period last year, while Indian exports remained more or less status quo. Thereafter, the Indian industry started to source more goods from Germany which reflected in the improving figures (May: -13.9%, June: -13.7%, July: -10.2%, August: -7.4%, September: -4.9%, October: -4.5%, November: -2.6%). Indian exports too started to turn around after June 2014 and steadily climbed (albeit with a very small percentage) from a -0.8% in May to a +2.1% by the end of the year. In 2014, the overall trade volume between India and Germany remained almost at the same level of the previous year, registering a very slight decline of 0.7%. Bilateral trade in 2014 amounted to nearly 16.0 billion, while in 2013, it was almost 16.1 billion. Indian imports from Germany experienced a decline of 2.9% over the previous year and amounted to 8.9 billion, while Indian exports to the country posted a growth of 2.1% to reach a volume of 7.0 billion. Machinery, Electro-technology and Chemical products Madein-Germany popular in India (Table 5) German Machinery, Electro-technology and Chemical products were the top three Table 4 Year Indian imports Indo-German Trade since 2000 ( million) % change Indian exports % change Trade volume % change 2000 2,084 12.8 2,464 15.7 4,548 14.2 2001 2,307 10.7 2,524 2.4 4,831 6.2 2002 2,422 5.0 2,543 0.8 4,965 2.8 2003 2,443 0.9 2,637 3.7 5,080 2.3 2004 3,289 34.6 2,957 12.2 6,246 22.9 2005 4,202 27.7 3,396 14.8 7,598 21.6 2006 6,365 51.8 4,175 22.5 10,540 38.7 2007 7,354 15.5 4,722 13.1 12,076 14.6 2008 8,155 10.9 5,253 11.2 13,408 11.0 2009 7,997-1.9 5,105-2.8 13,102-2.3 2010 9,254 15.7 6,193 21.3 15,447 17.9 2011 10,871 17.5 7,505 21.2 18,376 19.0 2012 10,384-4.5 7,219-3.8 17,603-4.2 2013 9,189-11.5 6,892-1.5 16,081-7.5 2014 8,925-2.9 7,040 2.1 15,965 --0.7 items of Indian imports from Germany in 2014. Imports of Machinery however declined by about 5.5% while Electro-technology and Chemical products grew Table 5 Indian imports from Germany ( 1,000) Category 2012 2013 % change 2014 % change % share Machinery, apparatus, gadgets, medical eqpmt etc. incl. complete plants 3,623,396 2,986,369-17.6 2,821,427-5.5 31.6 Electro-technology 1,190,973 1,096,094-8.0 1,139,319 3.9 12.8 Chemical products incl.petrochemicals, fertilizers & cosmetics 1,073,868 993,649-7.4 1,091,513 9.9 12.2 Metal & Metal products (excl. ore) 1,141,909 866,560-24.1 845,610-2.4 9.5 Optical and photographic equipment 808,580 756,539-6.4 715,094-5.5 8.0 Automobiles and ancillaries 495,400 453,029-8.5 486,472 7.4 5.5 Plastics 477,742 491,556 2.9 475,061-3.4 5.3 Aircraft & aerospace equipment 457,415 581,318 27.1 339,326-41.6 3.8 Pharmaceuticals 163,871 114,648-29.9 175,979 53.5 2.0 Paper, cardboard, printing material 194,158 132,573-31.4 152,215 14.8 1.7 Textiles & Garments incl. wool, fur & yarns 116,306 117,033 0.9 108,164-7.6 1.2 Rubber products 112,964 92,903-17.7 90,204-2.9 1.0 Furniture incl. lighting fixtures 84,507 72,937-14.1 70,967-2.7 0.8 Glass & ceramic products 79,197 78,020-1.3 66,537-14.7 0.8 Wood, cork (without furniture) 50,171 53,416 6.4 53,759 0.6 0.7 Gems & jewellery, precious metals & stones 35,869 55,577 55.6 39,886-28.2 0.4 Food, Beverages & Tobacco 30,065 25,951-13.3 27,416 5.6 0.3 Stone, Stone products, Cement 22,582 24,704 9.3 21,847-11.6 0.2 Track vehicles 33,460 29,719-11.1 20,022-32.6 0.2 Leather and shoes 13,941 12,060-12.9 13,783 14.3 0.1 Boats/Water transport 391 59-85.0 6,622 11,123 0.07 Others 177,084 154,411-12.8 163,697 6.0 1.83 Total 10,383,849 9,189,125-11.5 8,924,920-2.9 100.0 Annual Review 2015 19
3.9% and 9.9% respectively. Machinery nevertheless still remains the most important item of import with a share of 31.6% (2013: 32.5%) of total imports, and a value of over 2.8 billion. Imports of electro-technological products amounted to nearly 1.1 billion in 2014 and accounted for around 12.8% (2013: 12.0%) of total imports from Germany. Chemical products imports were to the tune of 1.0 bil., while accounting for a share of 12.2% (2013:10.8% share). Metal and metal products in the 4 th place posted a negative growth of 2.4% amounting to 846 million (9.5% share), and Optical and photographic equipment was 5 th in the list of imported items from Germany with imports amounting to nearly 715 million and a share of 8.0% in the import basket. Imports in this category however declined 5.5% over the previous year. Other products which posted an increase in imports in 2014 were Pharmaceuticals ( 176million; +53.5%) Automobiles & ancillaries ( 486.5 million; +7.4%), Paper, cardboard and printing material ( 152million, +14.8%) and Leather & Shoes ( 13.7million, +14.3%). There was also a sudden increase in Indian imports of Boats/Water transport from 59,000 in 2013 to 6.6 million in 2014. On the other hand, Aircraft & aerospace equipment experienced a substantial decline in imports (-41.6%) amounting to 339 million; Gems & jewellery ( 39.9 million, -28.2%) and Track vehicles ( 20.0 million, -32.6%). The top 5 categories accounted for nearly 74% share of total imports from Germany, while the top three accounted for about 57%. Textiles, Chemicals and Leather products are top sellers for India (Table 6) Indian Textiles, Chemicals and Leather products continue to be the export winners for India. In 2014, Textiles & Garments exports grew 10.7% to reach a volume of nearly 1.7 billion. Its share in total Indian exports increased from 22% in 2013 to 23.8% in 2014. Chemical exports on the other hand posted a substantial decline of 36.6% over last year. Exports in this category amounted to 951 million with a share of 13.5% (2013: 15%). Leather and shoes exports grew once again a healthy 12.5% to touch nearly 740 million. Its share in the export basket too grew from 9.5% in 2013 to 10.5% last year. Exports of Food, beverages & tobacco as well as Metal & metal products also grew by 6.8% and 4.8% amounting to 654 and nearly 633 million respectively. The shares of these products in total Indian exports to Germany were 9.3% and 9.0% respectively. After declining 5.8% in 2013, Indian exports of Machinery, gadgets and equipment to Germany grew 2.7% in 2014 to reach a volume of 536 million. Electrotechnology products exports declined again by 21.3% ( 437 million, 6.2% share), Automobiles and ancillaries ranking 8 th among the items of exports maintained nearly the same level as last year with exports worth 279 million. Among the categories that experienced increased exports (albeit with lower trading volumes) were Furniture including lighting, fixtures etc.( 129 million, +12.5%); Glass & Ceramic products ( 42.7 million, +26.5%) and Aircraft & aerospace equipment ( 15.6 million, +17.7%). The top five items accounted for a share of over 66% of total Indian exports to Germany, while the top three took up a share of nearly 48%. Table 6 Indian exports to Germany ( 1,000) Category 2012 2013 % change 2014 % change % share Textiles & Garments incl. wool, fur & yarn 1,453,254 1,515,372 4.3 1,676,761 10.7 23.8 Chemical products incl. petrochemicals, fertilizers & cosmetics 991,378 1,027,654 3.7 951,422-36.6 13.5 Leather, leather products & Shoes 602,844 657,145 9.0 739,519 12.5 10.5 Food, Beverages & Tobacco 636,721 612,429-3.9 654,028 6.8 9.3 Metal & metal products (excl. ore) 659,910 604,002-8.5 632,899 4.8 9.0 Machinery, apparatus, gadgets, med. equipment etc. 553,847 522,174-5.8 536,242 2.7 7.6 Electro-technology 700,179 554,992-20.7 436,813-21.3 6.2 Automobiles and ancillaries 312,805 277,973-11.2 279,602 0.6 4.0 Pharmaceuticals 264,537 258,291-2.6 224,146-13.2 3.2 Plastics 106,913 149,905 40.2 156,811 4.6 2.2 Rubber products 138,628 143,474 2.9 147,870 3.1 2.1 Furniture incl. lighting fixtures 101,120 114,585 13.9 128,896 12.5 1.8 Gems & Jewellery, precious metals & stones 104,264 112,518 8.7 101,438-9.8 1.4 Optical and photographic equipment 123,419 102,060-17.1 100,037-2.0 1.4 Stone, stone products, cement 71,485 63,856-9.9 67,662 6.0 1.0 Glass & ceramic products 34,980 33,755-3.4 42,683 26.5 0.7 Aircraft & aerospace equipment 16,308 13,279-18.4 15,631 17.7 0.2 Wood (without furniture) 9,950 11,272 13.0 10,865-3.6 0.15 Paper, cardboard & printing material 10,558 9,962-8.5 9,531-4.3 0.15 Others 101,160 107,455 6.9 127,091 18.3 1.8 Total 6,994,260 6,892,153-4.5 7,039,947 2.1 100 Annual Review 2015 21
Partners in Trade India and Germany India was the 25 th most important sourcing country for Germany in the year 2014 among the 239 countries and regions that Germany trades with according to the Federal Statistical Office in Wiesbaden. In 2013, India ranked 24 th among the 240 nations listed. With respect to its position as a destination country for German exports in 2014, India s retained its 25 th position of the previous year. As a supplier country to Germany, it was in the 27 th place last year, while in the previous year, it was two notches higher at the 25 th position. The percentage of Germany s trade with India in its total trade worldwide however still remains below the 1% mark. The Top Ten Trading Partners Germany s top ten trading partners worldwide (Table 7) Netherlands has been the main supplier country for Germany for several years. In 2014, the country accounted for 9.6% of Germany s total imports of 916,636 million from all countries of the world. China was the second-most important exporter to Germany. Its share in total German imports went up last year to 8.7% after dropping 8.5% in 2012 and 8.2% in 2013. Following China were France (7.4%), USA (5.3) and Italy (5.3%) in the 3 rd, 4 th and 5 th place respectively. In 2014, (Table 7) Ranking Top ten trading partners for Germany worldwide Main exporters to Germany Jan-Dec 2014 % share Ranking Main importers from Germany Jan-Dec 2014 % share 1 Netherlands 9.6 1 France 9.0 2 China 8.7 2 USA 8.5 3 France 7.4 3 UK 7.4 4 USA 5.3 4 China 6.6 5 Italy 5.3 5 Netherlands 6.5 6 UK 4.6 6 Austria 5.0 7 Poland 4.3 7 Italy 4.8 8 Belgium 4.3 8 Poland 4.2 9 Switzerland 4.3 9 Switzerland 4.1 10 Russia 4.2 10 Belgium 3.7 27 India 0.8 25 India 0.8 Germany s main trading partners worldwide in 2014 France Netherlands China USA UK Italy Austria Poland Switzerland Belgium Total: 2,050,178 million 103,035 92,536 87,494 85,611 81,838 126,349 ( million) 169,415 161,328 154,143 144,665 0 50000 100000 150000 200000 the new entrant among the top 10 exporters to Germany was Poland which displaced Russia in the 7 th place. Russia is now at no.10 which was held by Austria in the 2013 list. The top 10 supplier countries accounted for 58% of total imports into Germany. France was as expected the top importer of German goods in 2014. Of the total goods exported from Germany worth 1,133,541,783 million, France took up a 9.0% share. Second in place was the USA with a share of 8.5%, followed by UK in the third place with 7.4%. China (6.6%) and Netherlands (6.5%) were the 4 th and 5 th largest buyers of German goods in 2014. China bought more German goods than in 2013 with the result that its share increased from 6.1% in 2013 to 6.6% in 2014. The country also improved its ranking by a notch. Poland once again moved upwards in the ranking to no.8 in 2014 from no.9 of the previous year, increasing its share from 3.9% to 4.2% of total German exports. The composition of the top ten buyers for Germany remained the same in 2013. Overall the top ten importers for Germany accounted for nearly 60% of total goods exported from Germany. In 2014, Germany s foreign trade was to the tune of 2,050,178 million and the top ten trading partners were France, Netherlands, China, USA, UK, Italy, Austria, Poland, Switzerland and Belgium. Poland became Germany s 8 th most important trading partner in 2014 moving up from the 10 th place in 2013 and pushing down Switzerland and Belgium by a notch each. Top Ten Trading Partners for India worldwide (Table 8) According to the statistics by the Ministry of Commerce & Industry, Govt. of India, the value of goods imported from China was highest, which accounted for 13.5% of the total goods worth Rs.27,371 billion imported from the countries of the world during the last fiscal (Apr. 14 Mar. 15). Switzerland climbed to the second position from 3 rd in the previous year (replacing USA) and accounted for over 4.9% of India s total imports. In the third place was USA with slightly less than 4.9%. In the 4 th and 5 th place were Indonesia (3.4%) and South Korea (3.0%) respectively. In the previous year, Germany ranked 5 th as a supplier country for India, however, this year it went down a notch to 6 th position on account of South Korea, which moved up to no.5. Malaysia, which was at no.10 during FY 2013-14, jumped to the 7 th position during FY 2014-15, thus displacing Belgium, Australia and Japan downwards by a notch each. The top ten non-pol (Petroleum, Oil & Lubricants) countries accounted for over 42% of India s total imports in 2014-2015. (Table 8) Ranking Top ten trading partners for India worldwide Main exporters* to India April 14-Mar. 15 % share Main importers* from India April 14-Mar. 15 % share 1. China 13.5 USA 13.7 2. Switzerland 4.9 Hong Kong 4.4 3. USA 4.9 China 3.8 4. Indonesia 3.4 Singapore 3.2 5. S. Korea 3.0 UK 3.0 6. Germany 2.9 Germany 2.4 7. Malaysia 2.5 Sri Lanka 2.2 8. Belgium 2.4 Bangladesh 2.1 9. Australia 2.3 Netherlands 2.0 10. Japan 2.3 Vietnam 2.0 *Non-POL Source: Ministry of Commerce & Industry, Govt. of India Annual Review 2015 23
China USA Switzerland Germany Hong Kong Indonesia S. Korea Singapore Malaysia Belgium 0 1000 2000 3000 4000 5000 USA was the top buyer of Indian goods in the last financial year (Apr. 14-Mar. 15), accounting for about 13.7% of Indian exports worth Rs.18,978 billion. At no.2 was Hong Kong (4.4%) up from no.3 in the previous year - followed by China accounting for 3.8% of total Indian exports. Singapore and the UK ranked 4 th and 5 th with a share of 3.2% and 3.0% respectively. Germany improved its position of the previous year by a notch to become the 6 th most important buyer of Indian goods with a share of 2.4%. A new entrant to the list is Sri Lanka which ranked 7 th while taking up 2.2% of Indian exports. Netherlands dropped from 6 th to 9 th position while Bangladesh climbed from 10 th to 8 th rank. During FY 2014-15, Belgium was out of the top ten list and Vietnam was in. In the last financial year 2014-15, India s foreign trade was to the tune of Rs.46,349 billion and the top ten trading partners were China, USA, Switzerland, Germany, Hong Kong, Indonesia, S. Korea, Singapore, Malaysia and Belgium. Trade with the EU countries Germany s trade with the EU (Table 9) India s main trading partners worldwide Total: Rs.46,349 billion 1,243 1,172 1,165 1,108 1,046 1,036 986 2,008 3,928 (Rs. billion) 4,425 Among the 27 EU countries (without Germany) which are Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden and the UK, the Netherlands is the biggest supplier to Germany. The country accounted for 16.5% of the 533,016 Table 9 Ranking Germany s trade with the EU Top Ten (Jan-Dec. 2014) Germany imports from Source: Ministry of Commerce & Industry, Govt. of India % share in total imports from the EU Germany exports to % share in total exports to the EU 1. Netherlands 16.5 France 15.5 2. France 12.7 UK 12.8 3. Italy 9.1 Netherlands 11.1 4. UK 7.9 Austria 8.5 5. Poland 7.5 Italy 8.3 6. Belgium 7.5 Poland 7.3 7. Czech Republic 6.9 Belgium 6.4 8. Austria 6.8 Spain 5.3 9. Spain 4.7 Czech Republic 5.1 10. Hungary 4.1 Sweden 3.3 France Netherlands UK Italy Austria Poland Belgium Czech Rep. Spain Hungary million worth of goods that Germany imported from the EU in 2014. France was the next most important supplier for Germany (12.7%), followed by Italy (9.1%). In the 4 th and 5 th place were UK (7.9%) and Poland (7.5%). The composition of the top ten EU exporters to Germany in 2014 remained the same as in 2013. However, Poland which was at no.7 overtook Belgium and Austria to no.5 position in 2014. Czech Republic too improved its position from no.8 to no.7 in 2014. The top ten accounted for nearly 83.7% of Germany s entire imports from these 27 nations. Among the destination countries for German exports, France was once again on top of the list with a share of 15.5% of 657,164 million that Germany dispatched to the EU in 2014. UK and the Netherlands followed in 2 nd and 3 rd place with a share of 12.8% and 11.1% respectively. Austria (8.5%) and Italy (8.3%) were the 4 th and 5 th most important buyers of German goods in the EU. The top ten importers for Germany within the EU remained the same in 2014 as the previous year with the same ranking. These countries absorbed nearly 84% of total German exports to the region. 0 50000 100000 150000 200000 The top trading partners for Germany within the EU in 2014 were France, Netherlands, UK, Italy, Austria, Poland, Belgium, Czech Republic, Spain and Hungary. In 2014, Poland moved up a notch to displace Belgium to become the 5 th most important trading partner for Germany. These countries together accounted for nearly 84% of Germany s total trade within the EU. India s trade with the EU (Table 10) Germany was the top supplier for India among the 28 EU countries during the last fiscal (Apr. 14-Mar. 15), while accounting for a share of 26.1% of nearly Rs.2,987 billion (total Indian imports from the EU). Following this were Belgium (22.1%), UK (10.3%), France (9.1%) and Italy (8.7%). The composition of the top supplier countries for India in the EU remained the same last year (2014-15) as in the previous year (2013-14). Only Italy and France switched positions at the 4 th and 5 th place respectively. The top ten accounted for nearly 92.4% of India s total imports from the 28 EU nations. Germany s main trading partners within the EU Total: 1,190,180 million ( million) 41,880 59,796 70,409 92,536 87,494 81,838 103,035 126,349 169,414 161,328 India s total exports to the EU nations was nearly Rs.3,026 billion in the fiscal from Apr. 14-Mar. 15. Among them, UK with a share of 18.8% was the biggest buyer of Indian goods during the last financial year. Germany overtook Netherlands with a 15.2% share and was the second most important destination for Indian goods. Netherlands (12.8%), Belgium (11.1%) and Italy (10.3%) were at the 3 rd, 4 th and Annual Review 2015 25
Table 10 Ranking India imports from India s trade with the EU Top Ten (Apr. 14-Mar. 15) % share in total imports from the EU India exports to 5 th places respectively. A new entrant in the top ten list of the last fiscal is Ireland at the 9 th place, ousting Denmark from the list. These top ten buyers accounted for nearly 90% of India s total exports to the countries of the EU. % share in total exports to the EU 1. Germany 26.1 UK 18.8 2. Belgium 22.1 Germany 15.2 3. UK 10.3 Netherlands 12.8 4. France 9.1 Belgium 11.1 5. Italy 8.7 Italy 10.3 6. Netherlands 5.0 France 10.0 7. Spain 4.1 Spain 6.4 8. Sweden 3.6 Poland 2.1 9. Finland 1.9 Ireland 1.6 10. Austria 1.7 Sweden 1.5 Source: Ministry of Commerce & Industry, Govt. of India India s main trading partners within the EU Total: Rs.6,013 billion (Rs.billion) Germany 1,243 Belgium 997 UK 877 France 574 Italy 570 Netherlands 534 Spain 315 Sweden 152 Poland 103 Ireland 79 0 300 600 900 1200 1500 Source: Ministry of Commerce & Industry, Govt. of India German imports from the Asia-Pacific countries amounted to 158,514 million, while exports to these nations were to the tune of 161,151million. Hence the trade volume amounted to 319,665 million. The top trading partners for India within the EU during the last financial year were: Germany, Belgium, UK, France, Italy, Netherlands, Spain, Sweden, Poland and Ireland. France, which was at no.6 during fiscal 2013-14 has moved up to 4 th place and Ireland has replaced Finland in the new list of top trading partners of the last financial year. Nearly 91% of India s total trade with the EU was taken up the top ten countries. Trade with the Asia-Pacific countries Germany s trade with the Asia-Pacific countries (Table 11) Trade between Germany and the Asia-Pacific countries after declining slightly in 2013, grew a healthy 5.3% in 2014. German imports from these countries, which declined 5.2% in 2013, posted a growth of 4.5%. German exports to the region which had seen a slight decline (-0.8%) in 2013, also grew 6.1% in the last year. The trade volume with Germany s most important trading partner in Asia, China, grew a healthy 8.8% in 2014 after declining 2.6% in 2013. While exports to the Asian country grew 11.3% to reach a volume of 74.5 billion, German imports too appreciated 6.4% to around 79.3 billion. German exports to China takes up 46% of total exports to the Asia-Pacific region, and about 6.6% of Germany s total exports worldwide. German imports from the each of the top ten Asia-Pacific countries grew significantly in the year 2014 except in the case of Japan (-2.2%) and South Korea (-0.8%), where the declines were not strong. Imports from Taiwan, Malaysia and Thailand grew 9.4%, 9.4% and 8.2% respectively. According to the final trade figures, German imports from India grew only 1% to reach a volume of 7,040 million. However, this improvement came after a strong decline of 11.8% in the Table 11 Country German Imports (January-December) Germany s trade with the Asia-Pacific countries *) : Top Ten (in mil.) % change Country German Exports (January-December) 2014 2013 2014 2013 % change 1. China 79,349 74,544 6.4 China 74,504 66,912 11.3 2. Japan 19,056 19,492-2.2 Japan 16,919 17,076-0.9 3. South Korea 7,983 8,048-0.8 South Korea 15,625 14,447 8.2 4. Taiwan 7,079 6,472 9.4 India 8,925 9,147-2.4 5. India 7,040 6,968 1.0 Australia 7,805 8.585-9.1 6. Malaysia 6,112 5,588 9.4 Taiwan 6,884 5,884 17.0 7. Vietnam 6,032 5,615 7.4 Singapore 6,297 6,308-0.2 8. Singapore 5,014 4,808 4.3 Hong Kong 5,894 5,621 4.9 9. Thailand 4,628 4,279 8.2 Malaysia 4,799 4,798 0.0 10. Bangladesh 3,800 3,524 7.8 Thailand 3,942 3,930 0.3 Total ASEAN 29,238 27,186 7.5 Total ASEAN 22,426 22,005 1.9 Total Asia-Pac. 158,514 151,666 4.5 Total Asia-Pac. 161,151 151,882 6.1 Total Germany 916,635 898,163 2.1 Total Germany 1,133,542 1,093,114 3.7 * Provisional Figures for 2014, final figures for 2013. The 27 countries covered under Asia-Pacific region by the OAV include Australia, Bangladesh, Bhutan, Brunei, Cambodia, China, Hong Kong, India, Indonesia, Japan, Laos, Macau, Malaysia, Mongolia, Myanmar, Nepal, New Zealand, North Korea, Papua New Guinea, Philippines, Singapore, South Korea, Sri Lanka, Taiwan, Thailand, Timor Leste and Vietnam Source: OAV Annual Review 2015 27
Germany s main trading partners in the Asia-Pacific Region 2014 Total: in 319,665 million ( million) China 153,853 Japan South Korea India Taiwan Singapore Malaysia Australia Thailand Vietnam previous year. A new entrant into the top ten list is Bangladesh at the 10 th position. German imports from this South Asian country grew 7.8% to reach a volume of 3,800 million. 23,608 15,965 13,963 11,311 10,911 9,834 8,570 8,011 35,975 0 40000 80000 120000 160000 Source: OAV - German Asia-Pacific Business Association German exports to Taiwan experienced a surge and appreciated 17% to touch 6,884 million. With this, the country moved up from 7 th position in 2013 to 6 th in 2014 pushing Singapore down a notch. Exports to South Korea (8.2%) and Hong Kong (4.9%) also posted a healthy growth. Among the countries that bought less German goods were Japan (-0.9%), India (-2.4%) and Australia (-9.1%). Exports to Malaysia, Singapore and Thailand remained almost at the same position as in 2013. In 2014, though Indian exports to Germany improved significantly over 2013, India lost its 3 rd position to Taiwan to become the 4 th most important supplier in the Asian region. As a destination for German exports, it retained its 4 th position. Overall, with total trade with Germany amounting to 15,965 in 2014, India remains the 4 th most important trading partner for Germany in the Asia-Pacific region. The top ten trading partners for Germany in the Asia-Pacific region are: China, Japan, South Korea, India, Taiwan, Singapore, Malaysia, Australia, Thailand and Vietnam. The most important trading partners remain the same as in the previous India s main trading partners in the Asia-Pacific region Total: Rs.14,843 billion Rs.billion China 4,426 Hong Kong 1,172 Indonesia 1,164 South Korea 1,108 Singapore 1,046 Malaysia 1,037 Japan 948 Australia 798 Thailand 571 Vietnam 567 0 1000 2000 3000 4000 5000 Source: Department of Commerce, Govt. of India year - only Australia dropped two positions from no.6 in 2013 to no.8 in 2014. These countries together accounted for more than 91% of Germany s trade with the entire Asia-Pacific region. India s trade with the Asia-Pacific countries (Table 12) Around 30% of the goods traded by India in the Asia-Pacific region (total Asia- Pacific: Rs.14,842,763 million) was with China during the year Apr. 14-Mar 15, which made it the biggest trading partner for India. Imports from the Asian giant grew a whopping 19.5% during the last fiscal to reach a volume of Rs. 3,695,450 million. The country accounted for 39.8% of total Indian exports from the Asia-Pac region. Exports, however, fell 19.4% to touch Rs.730,384 million making it the second most important destination for Indian goods in the region. It took up 13.1% of India s exports to the region in the last fiscal. After China and with a substantial gap, the next most important supplier for India was Indonesia with a share of 9.9%, followed by South Korea with an 8.9% share. Indian imports from these countries grew 1.2% and 9.9% respectively. Malaysia was the 4 th largest exporters to India with a share of 7.3%. The country which was at no.6 in the previous year, jumped to the 4 th position during the last fiscal. Table 12 Country Indian Imports (Apr. 14-Mar 15) India s trade with the Asia-Pacific countries*: Top Ten % change over 2013-14 (in Rs. mil.) % share* Country Indian Exports (Apr. 14-Mar 15) % change over 2013-14 % share* 1. China 3,695,450 19.5 39.8 Hong Kong 831,355 7.6 14.9 2. Indonesia 917,713 1.2 9.9 China 730,384-19.4 13.1 3. South Korea 827,163 9.9 8.9 Singapore 610,210-19.2 11.0 4. Malaysia 680,199 21.9 7.3 Sri Lanka 410,383 47.7 7.4 5. Australia 627,680 2.9 6.8 Bangladesh 395,216 6.2 7.1 6. Japan 619,908 8.2 6.7 Vietnam 383,179 15.3 6.9 7. Singapore 435,506 5.9 4.7 Malaysia 356,304 40.2 6.4 8. Thailand 358,635 10.3 3.7 Japan 328,355-20.4 5.9 9. Hong Kong 340,886-22.8 3.6 South Korea 280,851 10.4 5.0 10. Taiwan 246,325 1.0 2.7 Nepal 278,449 27.9 5.0 Total ASEAN 2,734,315 8.7 29.5 Total ASEAN 1,957,366-2.6 35.2 Total Asia-Pacific 9,277,899 15.1 - Total Asia-Pacific 5,564,864 0.5 - Total Worldwide 27,371,385 0.8 - Total Worldwide 18,970,258-0.1 - *% share of India s total imports/exports from/to the Asia-Pacific region. Source: Department of Commerce, Govt. of India Annual Review 2015 29
Imports from the country appreciated an impressive 21.9% to touch Rs.680,199 million. Australia and Japan climbed down a notch each to the 5 th and 6 th position with a share of 6.8% and 6.7% respectively. Singapore and Thailand climbed up a notch each to no.7 and no.8 positions with a share of 4.7% and 3.7% respectively. Hong Kong on the other hand dropped from the 7 th position during FY 2013-14 to the 9 th place in FY 2014-15. Imports from the country declined 22.8%. The top ten countries in the list of supplier countries to India, which account for 94.3% of Indian goods imported from the Asia-Pacific region, remained the same as in the previous year. During FY 2014-15, Indian exports to the Asia-Pacific countries amounted to Rs.5,564,864 million, whereby exports to the top ten countries remained at more or less the same level as the previous year. Unlike the previous year where China was the biggest buyer of Indian goods, Hong Kong took over at the top position with Rs.831,355 million and a share of 14.9%. China was next with a share of 13.1%. Singapore was in the third place with a share of 11%. However, exports to this country too (like China) declined about 19.2%. Sri Lanka which was in the 8 th place during the previous year, catapulted to the 4 th position with Indian exports to country growing a whopping 47.7% and a share of 7.4%. Bangladesh and Vietnam were in the 5 th and 6 th positions, while Malaysia inched up from the 10 th position during FY 2013-14 to 7 th place during the last fiscal. Indian exports to the country grew phenomenally (+40.2%). The big loser was Japan which fell from 4 th to 8 th position with exports declining 20.4%. Nepal which was not in the top ten countries for Indian exports features in the list at the 10 th position. Exports to the Himalayan country grew 27.9% in the last fiscal. The top ten buyers for India in the Asia-Pacific region accounted for 82.7% of India s exports to the region. In 2014, Germany dispatched goods to the value of 657.3 billion to the Member States of the European Union (EU), while it received goods to the value of 599.9 billion from those countries. Compared to 2013, dispatches to the EU countries increased by 5.4%, and arrivals from those countries by 3.6%. Goods to the value of 414.2 billion (+2.7%) were dispatched to the Euro area countries in 2014, while the value of the goods received from those countries was 411.4 billion (+2.3%). In 2014, goods to the tune of 243.1 billion (+10.2%) were exported to EU countries not belonging to the Euro area, while the value of the goods which were imported from those countries was 188.5 billion (+6.6%). The top ten trading partners (in that order) for India among the countries of the Asia-Pacific region in the year Apr. 14-Mar 15 were: China, Hong Kong, Indonesia, South Korea, Singapore, Malaysia, Japan, Australia, Thailand and Vietnam. Trading with the world Germany s Foreign Trade German exports, imports and export surplus reach a new record high (Table 13) Germany exported goods to the value of 1,133.6 billion and imported goods to the value of 916.5 billion in 2014. Based on provisional data, the Federal Statistical Office (Destatis) also reports that German exports increased by 3.7% and imports by 2.0% in 2014 from a year earlier. In 2014, export and import levels were higher than the previous all-time highs recorded in 2012. In that year, Germany had exported goods to the value of 1,095.8 billion and imported goods worth 905.9 billion. The foreign trade balance showed a surplus of 217.0 billion in 2014, which was the highest value ever recorded. It clearly exceeded the previous peak of 195.3 billion achieved in 2007. In 2013, the surplus of the foreign trade balance was 195.0 billion. Table 13 German Foreign Trade 2014 German Exports Jan.-Dec.2014 (in bil.) German Imports Jan-Dec. 2014 (in bil.) Total 1,133.6 916.5 EU Member States 657.3 599.9 -Euro Area 414.2 411.4 -Non-Euro Area 243.1 188.5 Third Countries 476.2 316.6 Exports of goods to countries outside the European Union (third countries) amounted to 476.2 billion in 2014, while imports from those countries totaled 316.6 billion. Compared to 2013, exports to third countries increased by 1.5%, while imports from those countries were down 0.9%. The main German export product: motor vehicles Accounting for 17.9% of exports, Motor vehicles and parts thereof, was Germany s main export product in 2014. Machinery (14.5%) and Chemical products (9.4%) ranked second and third, respectively, among the most important export items. These three branches account for 41.8% of German exports. France is Germany s most important trading partner again According to provisional results, goods worth 169.4 billion were traded between Germany and France in 2014 (exports and imports). The Federal Statistical Office (Destatis) reports that the neighbouring country of France was Germany s most important trading partner again in 2014. Next came the Netherlands with a trading volume of 161.3 billion, followed by the People s Republic of China in third place with a foreign trade turnover of 154.0 billion. Share of German exports to the Euro area declines again in 2014 In 2014, Germany exported goods worth a total value of 1,133.5 billion. Based on provisional results, the Federal Statistical Office (Destatis) also reports that 36.6% of the total of German exports of goods were going to the then 18 countries of the euro area. This proportion was slightly lower than the one recorded in 2013 (36.9%). A decline in the proportion of German goods exported to countries of the euro area has been recorded for several years now. In 2005, the relevant proportion amounted to 44.7%. Annual Review 2015 31
32% of German exports went to the G7 countries in 2014 According to provisional data of the Federal Statistical Office (Destatis), 32% of German exports ( 362 billion) went to the G7 countries in 2014. This is reported by the Federal Statistical Office to mark the G7 summit which was held at the Bavarian Castle of Elmau on 7 th and 8 th June 2015. Most German goods exported to G7 countries went to France (28%), the United States (27%) and the United Kingdom (23%) in 2014. Italy was the destination of 15% of exports to G7 countries. Japan (5%) and Canada (2%) were less important recipients of German exports. 60% of German foreign trade businesses are only importers Roughly 700,000 businesses were engaged in German foreign trade operations. The Federal Statistical Office (Destatis) also reports that nearly 60% of them were only importers. They imported goods without being involved in any export operations. The value achieved by these businesses accounted for not more than 3% of the total German foreign trade value. The by far major part of the foreign trade value (95%) was achieved by the 27% of businesses which both exported and imported goods. seems to have been the best. In 2012-13, growth again dipped to 12.9% while in 2013-14, India s foreign trade posted a lower growth of 7.3%. During the last fiscal India s trade with the countries of the world remained nearly at the previous year and posted a negligible growth of 0.4%. On the imports side, 2004-05, 2008-09, 2011-12 were very good years with imports registering the highest increases of 39.5%, 35.8% and 39.3% respectively. 2009-10 was the worst performing year with Indian imports growing negatively at -0.8%. With the slowdown in the Indian economy, 2013-14 too was not good year for imports, which posted only a slight growth of 1.8%. During the last fiscal 2014-15, India s total imports grew just slightly by 0.7% to reach a volume of Rs. 27,371billion. Development of India s Foreign Trade (Table 14) India s trade with the countries of the world has seen some ups and downs since the year 2000. Highest growths in the volume of trade were recorded in the years 2004-05, 2008-09 and 2011-12, where India s foreign trade grew 34.3%, 32.8% and 34.9% respectively. After the dip in the year 2001-02, the trade volume grew for several years posting a double-digit growth. So far, 2009-10 was the worst year where the growth of trade was even slightly in the negative, while 2011-12 Table 14 India s foreign trade over the years (in Rs. billion) Year Imports % change Exports % change Volume % change 2000-01 2,309 7.1 2,036 27.6 4,345 15.9 2001-02 2,452 6.2 2,090 2.7 4,542 4.5 2002-03 2,972 21.2 2,551 22.1 5,523 21.6 2003-04 3,591 20.8 2,934 15.0 6,525 18.1 2004-05 5,011 39.5 3,753 27.9 8,764 34.3 2005-06 6,604 31.8 4,564 21.6 11,168 27.4 2006-07 8,405 27.3 5,718 25.3 14,123 26.5 2007-08 10,123 20.4 6,559 14.7 16,682 18.1 2008-09 13,744 35.8 8,408 28.2 22,152 32.8 2009-10 13,637-0.8 8,455 0.6 22,092-0.3 2010-11 16,835 23.5 11,429 35.2 28,264 27.9 2011-12 23,455 39.3 14,660 28.3 38,115 34.9 2012-13 26,692 13.8 16,343 11.5 43,035 12.9 2013-14 27,174 1.8 18,997 16.2 46,171 7.3 2014-15 27,371 0.7 18,970-0.1 46,348 0.4 Source: Department of Commerce, Govt. of India The best years for Indian exports were 2004-05 (+27.9%), 2008-09 (+28.2%), 2010-11 (+35.2%) and 2011-12(28.3%), with 2010-11 posting the highest growth since 2000. The lowest growths in exports were seen in the years 2001-02 (2.7%) and 2009-10 (+0.6%). Exports during 2013-14 experienced a healthy growth of 16.2%, while during the last financial year (2014-15), Indian exports remained stagnant, even posting a slight decline of -0.1%. 50000 40000 30000 20000 10000 0 2000-01 2001-02 2002-03 India s foreign trade over the years Rs. billion 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009 2010-10 -11 2011-12 2012-13 Volume Imports Exports 2013 2014-14 -15 Source: Department of Commerce, Govt. of India Annual Review 2015 33
World Economic Outlook: Growth prospects uneven (Table 15) Global growth prospects are uneven across major economies, says the IMF s latest World Economic Outlook (WEO). In advanced economies, growth is projected to strengthen in 2015 relative to 2014, but in emerging market and developing economies it is expected to be weaker. Overall, global growth is forecast at 3.5% in 2015 and 3.8% in 2016, broadly the same as last year. But this aggregate number masks the diverse developments. A number of complex forces are shaping the prospects around the world, says Olivier Blanchard, IMF Economic Counselor and Director of Research. Legacies of both the financial and the euro area crises weak banks and high levels of public, corporate, and household debt are still weighing on spending and growth in some countries. Low growth in turn makes deleveraging a slow process. Blanchard also notes that the combination of population aging, lower investment, and sluggish advances in productivity will lead to significantly lower potential growth both in advanced and emerging market economies. More subdued growth prospects lead, in turn, to lower spending and lower growth today, he says. On top of these underlying forces, two major factors, both with major distributional implications, dominate the current scene: the decline in the price of oil and exchange rate movements. Large movements in relative prices, whether exchange rates or the price of oil, creates winners and losers, says Blanchard. Advanced economies are doing better Global growth in 2015 will be driven by a rebound in advanced economies forecast to increase from 1.8% last year to 2.4% this year supported by the decline in oil prices, the WEO notes. Growth in the United States is projected to exceed 3% in 2015 16. Domestic demand will be supported by lower oil prices, more moderate fiscal adjustment, and continued support from an accommodative monetary policy stance, despite the projected gradual rise in interest rates and some drag on net exports from recent dollar appreciation. After weak second and third quarters in 2014, growth in the euro area is showing signs of picking up, supported by lower oil prices, low interest rates, and a weaker euro. And after a disappointing 2014, a weaker yen and lower oil prices are expected to lead to a pickup of growth in Japan. Emerging and developing economies will slow Growth forecasts for most emerging and developing economies (with the important exception of India) are slightly worse. Growth is projected to slow from 4.6% in 2014 to 4.3% in 2015. This reflects a variety of factors. Oil price declines will sharply slow growth for oil exporters, especially those that also face difficult initial conditions for example, geopolitical Table 15 tensions in the case of Russia. The Chinese authorities emphasis on reducing vulnerabilities from recent rapid credit and investment growth will likely cause a further slowdown in investment, particularly in real estate. Latin America s outlook will continue to weaken due to lower commodity prices. Brazil s outlook is also affected by a drought, tighter macroeconomic policies, and weak private sector sentiment. Unlike in advanced economies, windfall gains from lower oil prices are not passed through as directly to consumers in many emerging market and developing oil importers, and this is expected to mute any boost to growth. Instead, the benefits of lower oil prices are expected to accrue more to governments (for example, in the form of savings from lower energy subsidies), and so they may be used to shore up public finances. Growth in low-income countries as a group, however, has stayed high. Growth is expected to slow only slightly to 5.5% in 2015, from 6% in 2014, and then to rebound in 2016, partly thanks to increased external demand from advanced economy trading partners. Risks to outlook more balanced Risks to global growth are now more balanced relative to six months ago, but remain tilted to the downside. Macroeconomic risks have slightly decreased (e.g., recession and deflation in euro area), but financial and geopolitical risks have increased. Annual Review 2015 35
On the upside, the decline in oil prices could provide a greater boost to global growth than anticipated. Nevertheless, the following downside risks continue to remain relevant: A further sharp dollar appreciation could trigger financial tensions elsewhere, particularly in emerging markets. Disruptive asset price shifts remain a concern amid low term and risk premiums in bond markets. As the environment for these asset price configurations---very accommodative monetary policies and large output gaps in advanced economies- --is changing, there is scope for surprises and strong market reactions. Geopolitical tensions, stemming from ongoing events in Ukraine, the Middle East, and West Africa, could generate regional and global spillovers. Stagnation and low inflation in advanced economies, notwithstanding the recent upgrade to the near-term growth forecasts for some of these economies, could hamper the recovery. Raising growth still a priority The WEO emphasizes that decisive policies to boost actual and potential output are needed urgently. In many advanced economies, accommodative monetary policy remains essential to support economic activity and lift inflation expectations. There is also a strong case for increasing infrastructure investment in some economies and for implementing structural reforms to tackle weaknesses laid bare by the crisis, generate investment, and boost potential output. Priorities vary, but many advanced economies would benefit from reforms to strengthen labour force participation (Japan and the euro area) and overall employment levels, given aging populations, as well as measures to tackle private debt overhang. In many emerging market and developing economies, there is only limited macroeconomic policy space to support growth. In oil importers, however, lower oil prices will reduce inflation pressure and external vulnerabilities, and in economies with oil subsidies, the lower prices may provide room to strengthen fiscal positions. Oil exporters, on the other hand, have to absorb the terms-of-trade shock and face greater fiscal and external vulnerabilities. Those with fiscal space can allow public spending to adjust gradually to lower oil revenues. For others with some exchange rate flexibility, a depreciation would help the adjustment. Emerging market and developing economies also have an important structural reform agenda. These economies can reap productivity gains by easing limits on trade and investment, removing infrastructure bottlenecks (India, South Africa), and improving business conditions (Indonesia and Russia). In other countries (Brazil, India, and South Africa), reforms to education, labour, and product markets can help raise labour force participation and productivity. Finally, lower oil prices offer an opportunity to decrease energy subsidies and replace them with better-targeted programs, as well as reform energy taxation (including in advanced economies). The proper menu differs by country, says Blanchard. Given the short-term political costs associated with many of these reforms, the challenge will be to choose carefully among them. Source: IMF Survey, 14 th April 2015, www.imf.org Annual Review 2015 37