According to the Global Trade Research Initiative (GTRI), India needs to make more containers, use more containers made in India, strengthen its shipping companies, and improve its port infrastructure. The country needs help with high shipping costs, a shortage of containers, and too much reliance on other countries for shipping.

The cost of shipping a 40-foot container has gone up and down a lot between 2022 and 2024. Due to disruptions in the Red Sea, it’s now more than double what it was a year ago for Indian exporters sending goods to Europe and the US.

The average cost was around USD 4,942 in 2022; by 2024, it was around USD 4,775, still much higher than before the pandemic, when it was USD 1,420 in 2019.

GTRI founder Ajay Srivastava said the high shipping rates show that global trade still faces many challenges because of the pandemic. He also noted that there were reports of China keeping a lot of containers to increase its exports to the US and Europe. Still, he thinks the real problem is more about port congestion and Red Sea disruptions than China keeping containers on purpose.

Almost all of India’s cargo is carried by foreign shipping companies, and these companies control the prices and when things get shipped, which makes it hard for India to control costs and schedules. Indian companies only handle about 5-10% of the trading by volume.

With trade tensions rising between the US and China and shipping costs rising, India needs to focus on building its own shipping industry to handle more of its imports and exports.

GTRI also pointed out that much of India’s cargo goes through hubs like Colombo, Singapore, and Klang, making shipping take longer and cost more. India also relies heavily on containers from China, which makes it vulnerable to supply problems and price changes.

GTRI thinks it’s important for India to make more containers since it only makes about 10,000 to 30,000 a year, compared to China, which makes about 2.5 – 3 million a year. This means India has less than 1% of the global market, which makes it vulnerable to problems with getting containers.

Local containers are important because they cost Indian manufacturers between USD 3,500 and USD 4,000 to make a 40-foot container, which is more expensive than in China, which costs USD 2,500 to USD 3,000. This means Indian businesses rely heavily on containers from China, which makes the country vulnerable to problems with the supply chain.

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