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Sat 20 Sep 2014 01:20 AM

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India forecast to be UAE's top trade destination by 2030

Latest HSBC Trade Forecast also names China, Malaysia, Turkey as fastest growing export markets

India forecast to be UAE's top trade destination by 2030
(AFP/Getty Images)

India is forecast to be the UAE's top export and import destination by 2030, according the latest HSBC Trade Forecast.

In addition to India, the fastest growing export markets for the UAE will be China, Malaysia, Turkey - each of which will see the fastest growth rates between 2017 and 2030.

Asia and Turkey will also remain the most important trade partners in terms of imports, the report said.

Import growth will be fastest for goods originating from China, India, Turkey and Vietnam.

Commenting on the report, Tim Evans, regional head of global trade and receivables finance said: "Sectors such as infrastructure and construction, tourism, retail and Government investments in technology will continue to be the main drivers of the UAE's economy going forward.

"With that said, we still expect petroleum products to remain both the largest category of total exports and the largest contributor to total export growth up to 2030.

"It will account for over 40 percent of total export growth over this forecast horizon. So it is no surprise to see energy hungry countries such as India and China on top of the UAE's export list.

He added that UAE importers will continue to have their main focus on Asia and intra-regional trade as well. It will be these markets that prove to be the fastest growing corridors for the country's long term import growth, he said.

"We are already seeing this trend in the short term as the Trade Confidence Index reveals that 65 percent of businesses surveyed reported current trade activity with these regions while 75 percent believe that Asia or MENA will have the best opportunities of growth over the next six months," said Evans.

According to the Trade Confidence Index, a survey of importers and traders from the SME segment and issued as part of the HSBC Trade Forecast report, the UAE remains firmly positive about increasing trade activity over the next six months.

The country ranked third out of the 23 countries surveyed with 47 percent of respondents believing trading volumes will increase "slightly" over the next 6 months, and another 16 percent believe the increase in trade volumes will be "significant".

An increase in demand - either globally or in key markets - is cited as the basis for this increase by around 45 percent of respondents.

Globally, the report said world trade is set to resume its growth trajectory in 2016, presenting fresh opportunities for businesses that have positioned themselves to benefit.

Increasingly robust economic conditions in the US and the UK, along with a gradual rebound in the Eurozone, will give many international businesses a platform on which to build during 2015.

By 2030, China is expected to increase its overseas shipments five-fold as it strengthens commercial ties to emerging Asia, the Middle East and North Africa. India, meanwhile, is likely to be the world's fastest-growing exporter from 2014 to 2030, and has the potential to move from the 14th largest exporter of goods by value to the world's fifth largest.

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