Contraction in US and European economies adversely affects Indian air cargo exports - Logistics Insider

The economic contraction in the US and Europe has led to a decrease in demand for air cargo exports from India. This has resulted in a rise in available capacity and a fall in transportation rates. The decline in volumes of high-volume commodities like pharmaceuticals, automotive components, handicrafts, and textiles has also contributed to the decrease in air freight. The air freight industry is facing challenges due to the implementation of an 18% goods and services tax rate in October 2022. The civil aviation ministry is seeking to reconsider the taxation rate, and airlines like SpiceJet and IndiGo have been impacted by the weak demand. The Indian air cargo industry has potential for growth, but challenges such as lack of digitization and uncoordinated customs clearance processes need to be addressed.

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