The Indian logistics industry is projected to reach $468 billion by fiscal year 2027, with a compound annual growth rate (CAGR) of 11%, according to a recent report by Rubix Data Sciences. The report highlights that road transport, which constitutes over 60% of logistics transportation, has seen a 500% increase in budget allocation since 2014. This investment has led to substantial improvements in road infrastructure, potentially saving up to ₹4.8 trillion annually in logistics costs.
Railway freight loading has also demonstrated steady growth, achieving a 5% CAGR from FY2018 to FY2024 and reaching 1,591 million tonnes in FY2024. The development of dedicated freight corridors has contributed to enhanced operational efficiency. The Indian air cargo sector recorded a robust CAGR of 23% from FY2021 to FY2023, despite challenges posed by the pandemic. Meanwhile, major ports, which handle approximately 55% of port traffic, processed 819 million metric tonnes of cargo in FY2024, reflecting a 7% CAGR from FY2021 to FY2024.
Despite these advancements, the report notes two key challenges: the low infrastructure spending as a percentage of GDP (3.2%) and high logistics costs, which account for 13% to 14% of GDP. The logistics sector has experienced significant growth driven by government policies, infrastructure development, technological advancements in supply chain systems, and the expansion of e-commerce. India’s position in the World Bank’s Global Logistics Performance Index improved to 38 in 2023, with aspirations to enter the top 25 by 2030.
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