India’s logistics and warehousing sector is experiencing significant growth, supported by government policies, infrastructure improvements, technological advancements, and evolving consumer behavior.
According to a recent report by JLL, India’s total warehousing stock reached 533.1 million square feet in 2024. Notably, tier 2 and tier 3 cities now account for approximately 100 million square feet, or 18.7% of the total, highlighting their increasing role in the country’s logistics landscape.
The report attributes this growth to the implementation of the Goods and Services Tax (GST) and the adoption of a hub-and-spoke distribution model, which is enhancing warehousing capacity in these regions. The expansion is particularly driven by the rise of e-commerce, which has increased demand for fulfillment centers closer to consumers, improving last-mile delivery and reducing logistics costs.
An ANAROCK Capital report projects that industrial and logistics space absorption in 2025 may surpass the 25% annual growth recorded last year. The report also notes that the sector is benefiting from increased investments, digital transformation, and supportive policy measures.
Currently, the logistics and warehousing sector contributes an estimated 13-14% to India’s Gross Domestic Product (GDP). The government has introduced various initiatives, including the National Logistics Policy (NLP) and the PM Gati Shakti Programme, to enhance efficiency and competitiveness. According to Union Minister of Consumer Affairs, Food and Public Distribution Pralhad Joshi, these initiatives aim to reduce logistics costs from the current 13-14% of GDP to approximately 8%, aligning with global standards.
With continued policy support and private sector investment, India’s logistics and warehousing sector is expected to play an increasingly important role in the country’s economic growth.
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