India could deliver 6% of the world’s trade growth as outlook for Asia remains strong
DHL and the New York University Stern School of Business have released the latest DHL Trade Atlas 2025, providing a comprehensive analysis of the most important trends in global trade. The report reveals that Asia’s trade outlook remains positive, mirroring global trade, which is forecast to grow faster over the next five years compared to the preceding decade. In fact, a few countries in Asia – India, Vietnam, Indonesia and the Philippines – are expected to see especially strong growth. The South Asia as well as Southeast Asia regions are also set to outperform other regions in terms of trade growth.
New leaders in trade growth: India, Vietnam, Indonesia, and the Philippines
Between 2024 and 2029, four countries in Asia are forecast to rank among the top 30 for both speed (growth rate) and scale (absolute amount) of trade growth: India, Vietnam, Indonesia, and the Philippines.
In the next five years, India is anticipated to retain its third-place rank on the scale dimension as well as jump 15 spots to the 17th position on the speed dimension as its compound annual trade volume growth rate rises from 5.2% to 7.2%. Additionally, India may also deliver 6% of the world’s trade growth, behind China (12%) and the United States (10%).
The prospects of Vietnam, Indonesia and the Philippines are bright as they have displayed substantial potential to benefit from supply chain shifts and diversification strategies. Vietnam is expected to maintain a 6.5% compound annual trade volume growth rate over the 2024-2029 period and promote one position to rank fifth on the scale dimension. Indonesia is predicted to retain its 12th place on the scale rankings, while rising from 33rd to 25th in the speed rankings. More notably, the Philippines is set to leap 114 positions to rank 15th on the speed dimension, and rise from 68th to 30th on the scale dimension.
South Asia and ASEAN to produce faster growth rates than other regions
South Asia and the ASEAN regions are forecasted to deliver the fastest trade volume growth among major world regions from 2024 to 2029 with CAGR of 5.6% and 5.0%, respectively. In fact, trade growth is also expected to accelerate substantially compared to the previous five-year period in these regions. Other regions such as North America and Europe are forecast to grow at rates of 2.7%.
The DHL Trade Atlas also finds that the centre of gravity of world trade has shifted. The shares of trade conducted by the world’s major geographic regions has changed since 2000, with the most dramatic change observed in Asian economies. Between 2000 and 2024, the share of world trade borne by South & Central Asia rose from 2% to 5%. However, a major region like Europe saw its share of world trade decrease from 41% to 36% for the same period.
New record in long-distance trade as Asia becomes central to global production networks
Despite widespread interest in nearshoring and producing goods closer to customers, the DHL Trade Atlas 2025 demonstrates that trade has not become more regionalised overall. Actual trade flows indicate the opposite trend. In the first nine months of 2024, the average distance traversed for all traded goods reached a record 5,000 kilometres, compared to just over 4,500 kilometres in 2000. This development can be attributed to the fact that Europe and North America have increasingly traded with Asia, as “Factory Asia” becomes central to global production networks.
Faster global trade growth compared to the previous decade
Recent forecasts predict goods trade will grow at a compound annual rate of 3.1% from 2024 to 2029. This roughly aligns with GDP growth and represents modestly faster trade growth compared to the previous decade. Even if the new US administration implements all of its proposed tariff increases and other countries retaliate, global trade is still expected to grow over the next five years – but at a much slower pace, the report explained.
Source: Exim News Service: Bonn/New York, March 25