MUMBAI (February 23, 2016) – The Indian government’s “Make In India” campaign is set to take Indian air cargo to new heights, with an estimated growth rate of 6.7% for 2015-2016, according to India’s Ministry of Civil Aviation.

“In 2015, when all of the world was witnessing a downturn in air-cargo movements, India actually witnessed growth, at a rate of 6% – quite unbelievable, but it’s true,” said Renu Singh Parmar,  senior adviser at India’s Ministry of Civil Aviation, who was giving the keynote address at the Air Cargo India 2016 conference. “From April to December, domestic air cargo grew at 5-6%, and international cargo grew at 6.4%. You wonder how, since exports have been declining. It’s because our imports have actually gone up.”

That total figure for the year is expected to be even higher, according to Singh Parmar.

“What we estimate for the rest of 2015-2016 is that Indian cargo in total will grow at around 6.7%,” she said. “You might find this figure very optimistic, but our figures are from April to December, after which we extrapolated them and got 6.7%, and I think this is very much achievable.”

The “Make In India” programme was launched in September 2014 and stimulates foreign direct investment by encouraging overseas companies to design and manufacture in India.

Singh Parmar added that, to fully realize that growth, the country would have to address some major challenges.

“Cargo is the backbone of manufacturing, and for that a very robust supply-chain infrastructure is what we require,” she said. “However, this will have to be managed in India because 30-40% of the GDP forms all logistics costs. So if manufacturing has to grow, then we’ll have to cut the cost of logistics. Abroad, in developed markets, the cost of logistics is only 7-8%, so we have to think of increasing our competitiveness, but this can be done if we can bring down our overall costs in logistics supply.”

[The full version of this story will be published in the March issue of Asia Cargo News.]