News Brief
India’s Logistics Revolution: From Paper Trails To AI-Driven Precision
India's Logistics Sector (Representative Image)
Once synonymous with delays, paperwork, and fragmented trucking, India’s logistics sector — valued at $215 billion in 2021 — is being reshaped through technology and policy.
It is projected to grow at 10.7 per cent annually until 2026, powered by new-age logistics startups and global manufacturers localizing their supply chains.
Government data now indicates that India’s total logistics costs (TLC) are lower than earlier estimates of 13–14 per cent of GDP.
A recent report by the Department for Promotion of Industry and Internal Trade (DPIIT) puts TLC at 7.97 per cent of GDP and 9.09 per cent of non-services output in FY 2023 — signaling the early success of systemic reforms.
At the core of the transformation lies a shift to asset-light and tech-first operations.
Instead of owning massive fleets and warehouses, companies lease vehicles, employ gig workers as partners, and rely on AI-driven third-party platforms.
Across India, AI and IoT are rewriting the rules of logistics:
Predictive analytics and demand forecasting help manage supply chain volatility.
Sensors monitor trucks for fuel use, location, and temperature control in cold chains.
Robotics and drones automate warehouse operations, from sorting to inventory checks.
Two major government programs have accelerated the shift:
National Logistics Policy (NLP) — launched in 2022 and marking its third anniversary on 17 September — aims to create a unified, efficient logistics network.
PM Gati Shakti, a multimodal infrastructure master plan, integrates roads, railways, ports, and airports to streamline freight movement.
A key innovation is the Unified Logistics Interface Platform (ULIP) — a digital gateway allowing industry players access to real-time datasets across ministries.
According to the DPIIT study, ULIP and other reforms are already optimising logistics costs and improving turnaround times.
E-commerce demand — Same-day and next-day deliveries are now standard in cities.
Global manufacturing needs — Companies like Apple, Tesla, and Foxconn demand just-in-time logistics.
Cost pressure — Efficiency now defines competitiveness in India’s manufacturing drive.
India ranked 38th in the World Bank’s 2023 Logistics Performance Index (score 3.4), trailing China (19th) and Malaysia (26th).
The government is targeting a top 25 ranking by 2030.
India’s logistics renaissance is unfolding amid complex global shifts.
The US recently imposed a 50 per cent tariff on Indian goods — the highest in Asia — posing a potential headwind to “China+1” supply chain diversification strategies.
Meanwhile, domestic hurdles persist: land acquisition delays, skill shortages, and a fragmented base of small operators with limited digital capacity.
Despite these challenges, India’s logistics modernization represents a structural leap — not just an upgrade.
By blending technology, policy, and global integration, logistics is poised to become a strategic advantage in India’s economic rise.
In essence, India’s logistics overhaul marks a pivotal shift — from a cost burden to a cornerstone of competitiveness.
As automation deepens and infrastructure synchronizes, the country’s long-criticised supply chain could soon become one of its strongest economic assets.
