Indian Logistics market: Trends, Opportunities and Challenges! (Updated)

    Home Educational Indian Logistics market: Trends, Opportunities and Challenges! (Updated)

    Logistics is often regarded as the main component of a country’s economy since it provides cost-effective resources which are required by other industries.

    In India, the logistics industry continues to grow and prosper due to the improvement in retail, e-commerce, manufacturing and various other sectors. The rise in e-commerce consumption, as well as domestic logistics, also adds to an improvement in the Indian logistics market.

    The logistics sector in India is changing dramatically over the past few years, but interestingly enough it has gained a major share of attention only in recent years.

    This industry consists mainly of freight and transportation through road and rail, air and water, as well as inventory and warehousing.

    Currently, India is ranked 35th in the World Bank’s Logistics Performance Index (LPI). This also holds a mirror to the relatively low efficiency of trade logistics in India, when it is compared to other countries on similar grounds.

    Opportunities for the Indian logistics industry

    Going by expert views about the logistics sector in India, over time it has improved a lot. This is mainly because of the increased growth in the Indian economy, which has directly resulted in a rise in the amount of freight traffic that needs to be moved. This increase also led to an increase in scope in aspects such as transportation, warehousing, shipping services, express cargo delivery, container services and the like.

    The introduction of technologically aided infrastructure to the logistics industry is a smart move since it will greatly reduce the costs incurred in meeting customer demands. This growth of the logistics segment will contribute significantly to India’s economic development in general. According to popular market projections, the logistics industry is estimated to grow at the rate of 10 to 15 percent annually in the future.

    The Indian government has plans to implement several policies that will provide a fresh impetus to India’s economic development, especially in the small and medium sector of businesses. The prospect of fresh opportunities in these small to medium scale industries will, in turn, generate a higher demand for logistics. So this is more like a chain of opportunities and demands that will propel the growth of the Indian logistics market.

    Moreover, the introduction of GST is another step forward for this sector. The implementation of GST will allow companies that have many small warehouses in different parts of the country, to reduce these numbers to only a few in specific places. This has been made possible by implementing a new model of freight movement – from warehouses to manufacturing plants, wholesale outlets, and other POS. And it is worthwhile to mention here that this type of growth has been significantly backed by the boom in the e-commerce sector in India.

    Challenges that are likely to be faced

    One of the biggest challenges in India’s logistics industry are the hurdles in transportation facilities that are still prevalent, despite vast betterment over time. There are rules imposed by national, regional and local authorities, but they differ from city to city, resulting in a botched network.

    Also, there is a certain void when it comes to technology, which cannot be overlooked. Seamless integration of cutting-edge technology is needed to automate processes for faster turnaround and ease of smooth functioning.

    Then, a dearth of trained manpower in the Information Technology division, as well as hurdles in warehouse distribution facilities, are also responsible for the disorganized state of the logistics sector as of now.Till date, there has been a lack of adequate training in the relevant fields, which has led to a crisis of skilled management as well as client service personnel. Poor administration and facilities can also lead to high levels of loss and damaged resources that impact the growth.

    A lack of research is another reason behind the poor state of India’s logistics industry in the supply chain field. Although academicians are slowly understanding the worth of the logistics industry in recent times, this field is still not as explored as it should be. Proper research and development in this sector will throw more light and clarity on its weaknesses so that they can be worked upon and improved.


    The Indian logistics market will definitely witness a steady development than before – and as per The Economic Survey of 2017-2018, it is expected to reach INR 215 billion by next year, i.e. 2020. A combination of hard and soft infrastructure along with elements like education, effective training and policy-making are sure to have a positive effect on the logistics industry.

    PS: Author is a content strategist for Truckeze Logistics Solutions

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    Aanchal Iyer
    Aanchal Iyer is the Digital Marketing Manager and a Content Strategist. She has an experience of 11+ years as a content consultant and along with Aanchal is actively involved in writing about the advancement of technologies in our everyday life.

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