UNCTAD will support Indian economy navigate through COVID crisis, says Mr. Kituyi

Pandemic will realign globalization and throw new business opportunities for Indian firms

“Despite the negative impact of COVID pandemic on trade and investment, it is the conviction of UNCTAD that India, which is the engine of world economic growth, will prove to be the most resilient in the region and one of the most resilient, perhaps in the whole world. India can manage a relatively easier recovery from the COVID crisis compared to other countries. Foreign direct investment (FDI) is on a long term growth trend in India and it will continue to attract market seeking FDI in the post-crisis period. I see lot of interest among global investors in the emerging digital economy of India. So far in 2020, India attracted USD 650 million worth of risk capital investment in the technology sector. Apart from this, India has seen foreign investment in other sectors such as oil & gas,” said Dr. Mukhisa Kituyi, Secretary General, United Nations Conference on Trade and Development (UNCTAD) at a webinar on ‘The Role of Multilateral Organisations to promote Trade and Industry post COVID-19’. The webinar was organized by MVIRDC World Trade Center Mumbai to celebrate ‘World Trade Centers Association Day’.

Speaking about the near-term adverse impact of the pandemic, Dr. Kituyi said, “The significant health and economic impact of COVID crisis has led to decline in India’s foreign trade by 11%, greenfield FDI by 4% and mergers & acquisitions by 58% during the first quarter (Jan-Mar 2020). Globally, the flow of FDI is likely to fall 40% from USD 1.54 trillion in 2019 to below USD 1 trillion in 2020. This will be the first time global FDI flows is expected to be below USD 1 trillion since 2005. World economic output is likely to contract 20% in 2020 after falling 5% in the first quarter and 27% in the second quarter of 2020.”

Dr. Kituyi also highlighted the impact of this pandemic on globalization and global production networks. He said, “We should not forget that the fundamental shift in globalization and global value chain was already underway before the COVID crisis in the form of trade war, economic nationalism etc. COVID pandemic has only accelerated this trend and it will lead to more regionalization, re-shoring, shortening of value chains and a renewed focus on business sustainability. Global pandemic is triggering inflection point in the international production network. Indian businesses can take advantage of this realignment by carving out niches in the post-COVID world. Indian enterprises should adapt their business model by understanding how the global trade and investment landscapes evolve. Small and large enterprises in India should prepare for this realignment of global production networks and they should increasingly adapt digital technologies.”

Dr. Kituyi concluded his remarks by assuring that UNCTAD will support India’s efforts to recover from this pandemic. He said, “UNCTAD will continue to partner with industry bodies such as World Trade Center Mumbai and government departments in their efforts to support trade & industry. I am confident that India has a vibrant industrial ecosystem and UNCTAD stands ready to support the economy navigate through this new reality by way of business facilitation and digitization of enterprises.”

Speaking on this occasion, Mr. Robin van Puyenbroeck, Executive Director – Business Development, World Trade Centers Association (WTCA), New York remarked, “WTCA will strive to promote the brand equity of the global network of World Trade Centers through quality trade services and also by expanding its footprint in new markets. WTC network is a unique ecosystem of global connections that facilitate foreign trade and investment. Partnership among this network is all the more important in this challenging time. Our effort is focused on active engagement with members and fostering new partnerships. I am planning to visit India in the near future to discuss roadmap for our future engagement and trade services.”

Earlier in his welcome remarks, Mr. Vijay Kalantri, Vice Chairman, MVIRDC World Trade Center Mumbai said, “World Trade Center Mumbai works closely with foreign governments and trade support institutions abroad to promote India’s bilateral trade and diplomacy. The Center hosts inbound trade delegation from various countries from time to time to connect local enterprises to the global market. During this challenging time, we need to strengthen this partnership to sustain global trade and investment.”

Speaking about World Trade Centers Association Day, Mr. Kalantri said, “This Day is celebrated worldwide to remember the spirit of camaraderie among the World Trade Centers in the aftermath of the September 11, 2011 terrorist attack. On this day, World Trade Centers showcase their collective efforts towards common goals and values and the unique contribution that they make in their respective regions for strengthening the international trade.”

Mr. Kalantri suggested that multilateral organizations such as World Bank, UNCTAD, ITC and WTO should facilitate MSMEs and mid-sized companies in navigating through this crisis. These organizations should also play an important role in supporting least developed countries and emerging economies in combating this crisis.

During the event, Dr. Mukhisa Kituyi released the study on ‘Accelerating India’s Agriculture Exports’, which is the research publication of MVIRDC World Trade Center Mumbai. The publication carries meticulous analysis on India’s agriculture exports and the scope for enhancing it in the coming years.

In her remarks, Ms. Rupa Naik, Senior Director, MVIRDC World Trade Center Mumbai said, “MVIRDC World Trade Center Mumbai conducts research studies on contemporary issues of trade & investment to create awareness about the emerging business opportunities among our members.”

Mr. Y.R. Warerkar, Director General, MVIRDC World Trade Center Mumbai proposed vote of thanks for the event.

The webinar was attended by members of trade & industry, consular corps and representatives from financial institutions & academia.