India To Drive 6% Of Global Trade Growth, 3rd After US, China

India is projected to contribute 6% to global trade growth by 2025, trailing only China (12%) and the U.S. (10%), according to the DHL Trade Atlas 2025. With a projected trade growth rate rising from 5.2% to 7.2%, India will maintain its third-place rank in scale and climb 15 spots in speed rankings. Key drivers include strong foreign investments in manufacturing and a high trade-to-GDP ratio. Emerging Asian economies, including India, are expected to outpace global trade growth.

India is set to make remarkable progress in global trade over the next five years, contributing an impressive 6% to the world's trade growth. This positions the nation just behind China, at 12%, and the United States, at 10%, according to a joint report by DHL and the New York University Stern School of Business.

The recently published DHL Trade Atlas 2025 predicts that India will maintain its third-place rank on the scale dimension while achieving a significant leap of 15 spots to secure the 17th position on the speed dimension. This improvement is attributed to an anticipated rise in India's compound annual trade volume growth rate from 5.2% to 7.2%.

The report notes that although India was the 13th largest player in international trade in 2024, its trade volume grew at a robust compound annual rate of 5.2% between 2019 and 2024, far outpacing the global trade growth rate of just 2.0% during the same period.

"India's rapid trade growth reflected both its swift macroeconomic growth and its increasing participation in international trade," the report emphasized.

R S Subramanian, SVP South Asia at DHL Express, remarked, "The Trade Atlas underlines India's rapid expansion in global trade, positioning the country as a critical hub connecting the east and west. While we anticipate trade volume growth and an increase in global trade share, we remain cautiously optimistic about the future given the global economy's general volatility."

Interestingly, the report also points out that although China is often perceived as a more trade-oriented economy than India, "India's goods trade-to-GDP ratio was almost as high as China's in 2023, and India's trade intensity exceeded China's when considering trade in both goods and services."

The report attributes India's promising future in trade to significant new foreign investments in its manufacturing sector. In 2023, India emerged as the second most attractive destination globally for announced greenfield foreign direct investment, trailing only the United States. Notably, manufacturing has become the primary focus of these investments in India.

Emerging economies in Asia, including Vietnam, Indonesia, and the Philippines, are also forecasted to experience substantial trade growth alongside India. The report highlights that both South Asia and Southeast Asia are poised to outperform other regions in terms of trade expansion.

Ken Lee, CEO - Asia Pacific, DHL Express, commented, "With the ongoing diversification of supply chains that continues to reshape the commerce landscape, Asia has steadfastly emerged as a key player in the global market."

India's growing influence in global trade signals a transformative chapter for the nation as it strengthens its position as a pivotal player in the global economy.