The Indian logistics sector is on track for impressive growth, with projections indicating it will reach approximately $470 billion by FY2027. This expansion is driven by a robust annual growth rate of 11%, reflecting the sector’s increasing significance in the national economy.
Road transport plays a pivotal role, contributing over 60% of logistics transportation in India. Since 2014, road infrastructure investments have surged by 500%, leading to substantial enhancements in road networks. These improvements are expected to save up to Rs. 4.8 trillion annually in logistics costs, highlighting the substantial economic benefits of investing in infrastructure.
Rail freight operations have also seen steady growth, with a 5% annual increase in freight loading from FY2018 to FY2024, reaching 1,591 million tonnes. The development of dedicated freight corridors has further optimized rail transport efficiency.
Despite these advancements, challenges remain, including the low percentage of infrastructure spending relative to GDP (3.2%) and high logistics costs, which account for 13% to 14% of GDP. Addressing these issues will be crucial for sustaining growth and enhancing efficiency in the logistics sector.
Overall, the outlook for the Indian road logistics sector is highly positive, with continued investments and improvements expected to drive further growth and efficiency.
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