Spike in freight rate may hit momentum of pharma exports
Indore: The export of pharmaceutical products from Madhya Pradesh has seen a significant increase in the ongoing fiscal year with exports reaching over Rs 9,000 crore by January 2024, highest in the total export basket from the state, though the surge in freight rates may hit the momentum of overseas shipments.
According to data from the Directorate General of Foreign Trade (DGFT), Madhya Pradesh, the exports of pharmaceutical products from the state stood at Rs 9,737 crore from April 2023 to January 2024. In the last fiscal, total exports of pharmaceutical products from the state was Rs 10,771 crore.
Pharmaceutical products are a key export item from Madhya Pradesh followed by cotton, engineering machineries and textile products.
Though the surge in freight rates due to the Red Sea crisis has posed a challenge for overseas shipments, said industry experts and exporters claim about a 20 per cent increase in shipping freight rates within a span of three months, affecting the overall export momentum.
Amit Chwala, an exporter of pharmaceutical products from Indore said, “Demand of pharmaceutical products is good but the surge in freight rates have adversely impacted the momentum. Because of the disturbance going on in the Gulf, shipping lines have increased freights by 20 per cent within 3 months.”
Total exports from Madhya Pradesh in the financial year 2022-23 was recorded at Rs 65,878 crore, securing the state the 13th position in the country’s export rankings.
“The sharp rise in freight rates impacts the export sector in Madhya Pradesh, especially the MSME sector. This calls for government intervention and need for strategic measures to mitigate the effects and sustain the state’s export growth trajectory,” said another drug manufacturer Himanshu Shah.
Source – ETHealth World
