DHL Express to invest ₹1,800 cr in India over 5 years
India continues to be among the top five markets for DHL Express, the global logistics major, with the company witnessing a strong “doubledigit growth” here , John Pearson, Global CEO, DHL Express, told businessline.
The company is investing over ₹1,800 crore (€200 million) in India over the next five years. Global economy and trade are weak but these are “bottoming out”.
According to him, India continues to be an outlier in comparison to most global markets (barring the US). The country is drawing in more foreign investments and these investments have now started materialising into “shipments”.
Another DHL group company, DHL Supply Chain, has already committed €500million investment (₹4,500crore plus) over five years.
“India is already the fifth largest economy in the world and is posting a GDP far over anyone else. Then you put that against the backdrop that India is already one of our top five markets. And it is already growing in doubledigits for February, year to date ..... What it is doing now is important. Now it is one of the fastest growing large markets in our networks and that’s for sure,” Pearson said.
According to him, “not many countries seem to be on their stride in economic and policy sense” when compared to India.
“India has attracted more inward investment than every other country apart from the US..people are putting their money on the India horse.
Some of that investment was made two years ago and have started to produce shipments for us now. So, India happens to be a very important market, it is growing fast and has a lot of potential,” he added.
‘CHINA +1’ BENEFICIARY
While acknowledging the emerging trend of diversification from China, Pearson said, India stands out as a primary beneficiary of the ‘China +1’ strategy. Although the trend is modest and there are implications on the supply chain, India is attracting multinational corporations seeking to mitigate risks and diversify manufacturing bases.
A ‘China +1’ strategy does not mean that a company has picked up its manufacturing (facilities) and moved away. Rather it meant having the new facility somewhere else.Apart from India, Vietnam, the Philippines and Thailand are seen as strong backups for those diversifying their supply chains within Asia.
“Over the last twothree years, maybe threefour years also, ever since this China+1 strategy has come in, some countries are becoming the beneficiaries of this supply chain derisking…… and India is certainly a beneficiary or one of them,” he said, adding that “….but India has its case to sell with makeinIndia and investments in the National Logistics Policy.”
The benefits of the National Logistics Policy are expected to play out “over a long period”, because the policy is dealing with “things may not be generational, but certainly a decade”.
China, however, will continue to have prominence as a global supplier, but any significant shifts are expected to occur gradually.