Overview
The annual logistics spending in India accounts for 14% of India’s GDP, which amounts to $270-310 billion as India’s GDP is roughly $3 trillion. This is much higher than the 8-9% limit in USA, Europe etc. Almost 99% of this cost is accounted for by the unorganized sector, comprising small truck owners, small warehouse operators, freight forwarders, last-mile connectivity providers etc. This increased spending has led to rise in costs of Indian goods, making them less competitive. Also, the presence of unorganized players has led to the segment contributing lesser in terms of tax as well as circumventing the Motor Vehicle law or on-road duties. Most importantly, the sector has largely remained out of technological influence, at a time when almost every other industry is seeing digital intervention and transformation. However, led by new-age, tech-focused players, the logistics sector is warming up to the idea of digitization for progress.This is a premium article available exclusively for our subscribers.
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