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Logistics

The Indian logistics sector is on a big growth tide. According to the domestic rating agency ICRA, Indian logistics sector is expected to grow at a rate 8-10 per cent over the medium term. This is an improvement over the compound annual growth rate (CAGR) of 7.8 per cent at which the industry grew during the last five years. The logistics industry of India is currently estimated to be around US$ 160 billion. With implementation of GST the sector is expected to benefit and touch US$ 215 billion over the next two years, as per the Economic Survey 2017-18.

The last couple of years have seen significant development for this industry which is reflected in the global rankings. According to the Global Ranking of the World Bank’s 2016 Logistics Performance Index, India jumped to 35th rank in 2016 from 54th rank in 2014 in terms of overall logistics performance. The report also showed that India’s logistics sector has improved its performance on all the six parameters used in the ranking. This is a huge jump of 20 ranks and clearly indicates the growth of the sector.

There is a lot of investment that the industry is attracting and as a result of the transformations and changes led by these investments, the industry will stimulate job creation. The experts predict that it can be the largest job creator by 2022.

The sector currently provides employment to more than 22 million people in the country. The report also emphasises that improving the sector would result in a 10 per cent decrease in indirect cost, in turn leading to a growth of 5-8 per cent in exports.

The Indian government has announced that it is working at the policy in order to set up new logistics plan in the country. The intention is to devise the most cost-effective method to transport goods by the year 2035.

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