Insights

Indian Logistics

Focus on infrastructure creation to sustain and drive growth

India’s need for infrastructure creation in the logistics sector is striking. In just a decade India has seen its economic size more than double to $ 1.37 trillion.This growth has been accompanied with a phenomenal rise in the volume of freight traffic movement over the period. However, logistics infrastructure and services in the country have arguably not developed at the same pace to support and further this growth.

For any economy, the logistics sector, encompassing transportation, warehousing, cargo consolidation and border clearances, would form the backbone of its trade, and associated economic activity and growth of key sectors. The cost of trading whether by sea, land or air forms a critical component of the final price of a commodity. An efficient logistics system reduces this cost, providing a competitive edge and propelling economic activity.

The current stress on the logistics system and its performance suggests that one of the key issues is inadequacy of transportation logistics infrastructure. In recent years, the Indian government has accorded high priority to this and allocated greater public budget to boost overall infrastructure spending.

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