Exporters plan to set up inventory management centre at Antwerp.

Bangalore: India’s top export promotion body intends to open a warehouse at Antwerp port in Belgium as European buyers look to trim inventory costs to stay competitive.

“We are pursuing this plan,” said Ajay Sahai, director general of the Federation of Indian Export Organizations.

India’s exporters want a warehouse in Europe to manage inventory of their exports to that continent, Sahai said. “Antwerp is strategically located and cost-effective when compared to other European countries where warehousing costs are very high,” he added.

Hit by the global slowdown, buyers in Europe have started asking their overseas suppliers to maintain their inventory.

“European buyers feel that the high warehousing and inventory costs are cutting into their competitiveness. One of the cost-cutting measures adopted by them to trim the inventory costs is to pass on the responsibility of maintaining the inventory to the suppliers,” said S.R.L. Narasimhan, secretary at Western India Shippers’ Association, an industry lobby group.

Earlier, buyers in Europe had distribution centres in Rotterdam in the Netherlands and Hamburg in Germany, where the imported cargo was segregated and redistributed to various parts of Europe.

Sahai said the proposed warehouse would be a multi-product facility that can be used to aggregate cargo before redistributing it to different customers in Europe. Fieo opened a similar facility at Sharjah in the United Arab Emirates in 2007 to cater to India’s exports to West Asia and the Gulf region.

“The port of Antwerp is the European gateway and the fastest route to the continent for the Indian trade,” Luc Arnouts, chief commercial officer, Antwerp Port Authority, had earlier told Mint.

Antwerp, Europe’s second biggest port by volume of cargo handled, has cargo handling facilities, logistics firms and industries operating at its premises.

The port has the largest dry warehousing and chemical storage capacity in Europe and the biggest chemical and petrochemical cluster that offers 5.3 million sq. m of covered space.

“As a result, the nearby areas of the port are considered ideal for European distribution centres,” Arnouts said.

Antwerp, the third biggest container port in Europe, is centrally located with 60% of the European purchasing power within a radius of 500km. It is well connected to the hinterland by rail, barge, pipeline and road, thereby offering seamless services to and from Europe. The port handled 190 million tonnes of cargo in 2008.