The logistics industry holds unprecedented importance as it connects various markets, suppliers and customers dotted across the country, and is an integral part of the national GDP value chain. The consumer demand for value-added services provides opportunities for industry players to elevate from operation to strategy.
There is an immediate need for the highly fragmented Indian logistics market to get more organized and reduce logistics cost to 10% of the GDP from the current 14%, by 2022. The Indian logistics market is expected to grow at a CAGR of 10.7 percent during 2020-2024.
Infrastructure readiness and technology are expected to be the key drivers of growth for the Indian logistics industry. India has the world’s 2nd largest road network with 5.5 million km comprising national & state highways and urban & rural roads. Additionally, it also has a well-developed framework for Public-Private Partnerships (PPP) in the highway sector. During April to September 2020, 3951 km of road was constructed. Derivatively, a target of 11,000 km has been set for the 2021-2022 fiscal year.
Multi-Modal Logistics Parks Policy (MMLPs) is expected to lower freight costs, reduce vehicular pollution and congestion and cut warehouse costs to promote domestic and global trade. The National Logistics Portal will serve as a transactional e-marketplace by connecting buyers, logistics service providers and relevant government agencies.