India’s trade dependence on China, EU rose in Q1 of 2024, says UNCTAD

India’s trade dependence on China and the EU increased in the first quarter of 2024 while it reduced on Saudi Arabia, the United Nations Trade and Development (UNCTAD) said Tuesday.

In its Global Trade Update, it said that the global trade trends have turned positive and global trade growth was driven by increased exports from China, India, and the US, while Europe and Africa disappointed.

As per the report, India’s trade dependence on the EU and China increased 1% and 1.2%, respectively while that on Saudi Arabia fell 0.5% in the quarter.

“Global trade growth in the first quarter of 2024 was primarily driven by increased exports from China (9%), India (7%) and the US (3%),” it said.

Conversely, Europe’s exports showed no growth and Africa’s exports decreased by 5%.

On the export side, China and India exhibited very strong quarter-over-quarter export performance, according to the Geneva-based organisation.

During the first quarter of 2024, trade growth in developing countries and South-South trade outpaced that in developed countries.

“Current global trade trends have turned positive, with goods trade increasing by around 1% quarter over quarter (QoQ ) in Q1 2024. Services trade grew at approximately 1.5% QoQ,” UNCTAD said.

Trade growth varied across sectors, with green energy and AI-related products experiencing stronger increases.

The UNCTAD nowcast predicts a stronger positive trend for the second quarter of 2024, projecting an approximate 2% increase for the first half of 2024. This increase is expected to add around $250 billion to goods trade and about $100 billion to services trade in the first half of 2024 compared to the second half of 2023. If positive trends persist, global trade in 2024 could reach almost $32 trillion, yet it is unlikely to surpass its record level seen in 2022.

The outlook for 2024 remains positive, but geopolitical issues and industrial policies will continue reshaping global trade patterns, it said.