UAE to outpace China to become India's largest trading partner by 2025: HSBC

India's global trade will grow 156 per cent by 2025 with trade volumes reaching $976.7 billion.

According to the latest HSBC Trade Connections quarterly world trade forecast, with such growth, India will be amongst the top five international powerhouses which will drive world trade growth until 2025,

It said trade with UAE and China is expected to grow by 190 per cent and 165 per cent respectively, making UAE India's largest trading partner by 2025.

"The HSBC Trade Connections Reports expect India's trade volumes to grow as much as 156 per cent by 2025," says Bhriguraj Singh, head, trade and supply chain, HSBC India.

According to Singh "The reports confirm the shift in India's trade patterns that we have been witnessing - trade with the Middle East corridor, China, and a few Latin American countries is expected to be higher than India's traditional large trading partners in the US and Europe; throwing open several new options and opportunities for Indian exporters and importers."

For the perspective on the short term trade business confidence, the HSBC Trade Confidence Index has reveals a dip in confidence amongst importers and exporters in India.

Indian traders reported a dip of  11 index points, in line with the views reported by global traders (-2 index points) and Asian traders (-3) from the first half of 2011, indicating that despite indications of long term growth, traders are expecting global economic headwinds to impact global trade over the next six months.

It was revealed that 41 per cent of respondents in Asia expect the global economy to decline within six months, but the vast majority (83 per cent) anticipate either an increase in international trade volumes, or consistent levels of international business activity.

With Indonesia becoming the most confident market globally, businesses in both Indonesia and Malaysia were particularly optimistic about their immediate future, showing a positive uplift in confidence on the first half of 2011. Businesses in Singapore (-16), mainland China (-14) and India (-11) showed the largest drops in confidence, revealing a pessimistic six-month outlook amongst importers and exporters in these markets.

Trade growth forecasts breakdown:           Trade Confidence Index breakdown: