India in sights for ausbiz: survey

Australian businesses consider India to be the top market for new potential trade opportunities, according to a newly released, nationwide trade survey. And they’re confident Australia’s reputation as a producer of high-quality goods and services will help them succeed

The 2024 National Trade Survey, put together by the Australian Chamber of Commerce and Industry with support from the Australian Centre for International Trade and Investment and ANZ, spoke to 239 companies from all Australian states and territories.

The seventh annual poll took input from small, medium and large businesses in both the goods and services space, and from across all major sectors - creating a comprehensive view of the opportunities and challenges Australian businesses face today.

The survey found that among Australian businesses exploring opportunities in new markets, India ranked as the number one choice, ahead of China and Singapore. Only 28.5 per cent of those surveyed said they currently trade in India.

This finding is not a huge surprise for us at ANZ. ANZ Research expects India to record annual growth of 6.8 per cent in the year ending March 2025. Our Group Executive, Institutional Mark Whelan has spoken publicly about the location being one of the most fertile for investment in Asia.

The bank has had a presence in India for decades and regularly has conversations about the opportunities present in India and elsewhere in the region. ANZ aims to be the best bank in the world for customers trading goods and capital across the entire Asia-Pacific.

Reputation

The survey found China and the United States were the most common locations for international trade among Australian businesses, with just under 50 per cent of respondents that trade internationally saying they participate in those markets.

Singapore, the United Kingdom and New Zealand round out the top five – all markets where ANZ has a presence on the ground.

Interestingly, the survey found Australia’s reputation as a producer of high-quality goods and services is considered by businesses to be their number-one strength when it comes to international competitiveness, showing the regard for which Australian businesses are held in outside our borders.

Key drags on international competitiveness listed by respondents included labour costs, taxes and red tape. Issues respondents worry could impact international trade include those labour costs, as well as environmental, social and governance concerns, including supply chain due diligence.

Shipping costs were also an issue, labelled as either a major or moderate concern by 90 per cent of respondents, according to the survey.

Response

Among explicit risks business see when it comes to international trade, cybersecurity is at the forefront of respondents’ minds, with at least 80 per cent somewhat concerned. Geopolitical tensions, including conflict in the Middle East and US-China trade tensions, round out the top three.

In response to these risks, businesses are taking a wide range of actions. Among exporters, at least 40 per cent of respondents are expanding sales locally in Australia, in existing offshore markets, and in new trade locations.

Importers are increasing inventories (42 per cent) and contracting new suppliers from existing or new markets (both 38 per cent).

Only one in five respondents told the survey they were taking no action at all.

The survey found the digitisation of trade for Australian businesses continues apace, with respondents considering various digital tools as critical for their business.

When asked about digital payments platforms, 39 per cent of those surveyed said such tools were very important to their business, while 31 per cent said they were somewhat important.

The survey also asked businesses about their use of trade finance products; 23 per cent of respondents indicated they used such a thing. Of that cohort, 61 per cent utilised trade finance loans; 50 per cent said the products helped them better manage liquidity.

Support

ANZ prides itself on the support the bank provides to local and global businesses looking to connect with growth opportunities across Asia Pacific and beyond. The bank has invested in providing customers with innovative technology that offers fast, secure and world-class digital platforms.

At ANZ, we’re committed to helping our customers capitalise on the movement of money and goods across the region, by leveraging our network of banking specialists and experts spanning close to 30 markets around the world.

We look forward to helping business navigate the challenges and take advantage of the opportunities offered by international trade, today and in the future.

Simone Fynmore is Head of Trade & Supply Chain Sales Australia & PNG, Transaction Banking at ANZ Institutional