What will drive growth of the Logistics industry of India in the near-term?
India has emerged as the fifth largest economy of the world and is slated to be a $5 trillion economy by 2027. The logistics industry will play a crucial role in the pathway to growth. Even the Government acknowledges that an efficient logistics eco-system builds the foundation for robust economic growth. The PM GatiShakti National Master Plan, which includes logistics infrastructure as one of the seven key transformation engines, and subsequent roll-out of the National Logistics Policy (which aims to build efficiency and resilience through multimodal transportation capabilities and technology integration), will definitely enhance the logistics performance of the country and create new growth opportunities. The Indian logistics market is expected to grow $380 billion by 2025 from $250 billion in 2021 at a CAGR of 10-12%.
What are the challenges confronting the industry?
The industry has been facing four key challenges: the fragmented nature of the industry, low level of technology deployment, over-dependence on road transportation, and scarcity of talent both at the operational and management levels. However, the PM GatiShakti National Master Plan and NLP will turn out to be game changers for the industry. The Unified Logistics Interface Platform (ULIP) proposed in the NLP will also address issues related to supply chain in the country.
How is AI impacting GATI operations and ensuring seamless and hassle-free end-to end logistics solutions to its customers?
GATI has recently integrated AI into its command centres and control tower, allowing us to plan or re-plan transportation routes in real time, depending on traffic situations and weather conditions. AI has boosted our decision-making capability, and capacity planning has also improved. We can consolidate data from a variety of external sources and use the same to re-plan and execute in real-time. In fact, AI deployment has strengthened our capacity planning, operational and cost efficiency in a big way.
How are PM GatiShakti and other initiatives transforming the Logistics industry?
The Government is playing an enabling role in bringing capacity and efficiency-led transformation to the industry; such an approach will unleash new possibilities. The PM GatiShakti National Master Plan will create a strong positive impact on the Logistics Industry by bringing in 16 ministries, and facilitate integrated planning and concerted execution of infrastructure connectivity projects.
The PM GatiShakti aims to integrate various modes of transportation, including roads, railways, waterways, and airways, to reduce transportation costs, improve delivery times, and increase overall efficiency, thus creating a more efficient and interconnected logistics network. This, in turn, will drive growth and competitiveness in the logistics sector, which will contribute significantly in the country’s economic growth.
Which sectors is GATI catering to and what services does it provide?
GATI offers services to a number of industries including electrical equipment, apparel, automotive, pharmaceutical, heavy engineering, etc. We offer holistic logistics solutions which include hub-to-hub goods movement, packing and warehousing, IT, last mile delivery, and reverse/return pickups.
It is also offering express distribution services, transportation services, end-to-end logistics solutions, and a host of special services such as Student Express, Bike Express, Art Express, etc.
Strategically located close to the MSME clusters, GATI service delivery points offer a range of customised services such as pick-ups, next day deliveries, etc. We enhance our service offerings continuously to cater to the growing demands of retail and SME businesses.
As express logistics operations are time-sensitive, GATI is leveraging technology to enhance data sharing among operations, customers and vendors to optimise operations. We have launched WhatsApp chatbot GATI Genie to facilitate superior customer engagement. We have also invested in developing our resource planning software, GATI Enterprise Management System (GEMS 2.0), and have developed customer relationship management (CRM) tool ‘Drishti’ powered by Salesforce to boost scalability and integration aspects.
How do you adhere to the ESG standards and how is it impacting business since a lot of transportation is required in the daily operations?
As a part of GATI ESG plans, we aim to convert our entire pickup and delivery fleet of more than 2500 vehicles into alternative fuel vehicles by 2025. We have recently collaborated with Gentari to deploy electric cargo vehicles and are committed to our vision to offer green express logistics solutions and support the government’s goal to cut the net carbon emissions to Zero by 2070.
Besides our environment-friendly, state-of-the-art warehousing facilities at Delhi, Mumbai and Nagpur, our surface transhipment centres will have a solarisation facility, which will generate 150 KW of power. We will build more such warehouses across the country.
What does GATI’s network comprise of?
GATI offers an integrated and IT-backed multi-modal network to offer end-to-end logistics services through a network that covers more than 19,000 pin codes (735 out of 739 districts in the country). GATI, being an Allcargo Group company, benefits from the latest technologies and access to a global network that spans over 180 countries. All GATI distribution centres are networked via the GEMS (GATI Enterprise Management System), a real-time ERP and has a single-window platform for keeping track of all shipment transactions with real-time updates.
GATI’s customised, end-to-end logistics solutions, and unparalleled reach across India, with advanced tracking services, quick and trusted claim process, and reverse logistics expertise, make us stand out from the rest. As our operations primarily run on wheels, we ensure regular training and development and overall well-being of the trucking community. At our STCs, we have a drivers' lounge to ensure adequate rest and rejuvenation for the drivers.
How is GATI fulfilling delivery of global consignments?
As a part of Allcargo Group, GATI has the capability to facilitate seamless integration of its domestic express logistics services with global freight forwarding services of the Group. Our association with Allcargo Group opens up a number of opportunities to offer integrated logistics solutions.
We are now in a position to serve customers more efficiently and holistically.
What are the company’s expansion plans?
We have plans to launch state-of-the-art, tech-enabled surface transhipment centres (STCs) across India. GATI has already launched STCs in Farukh Nagar (Gurugram), Nagpur, and Guwahati, and a 1.48 lakh sq. ft. STC and distribution warehouse in Bhiwandi near Mumbai. Other STCs in the pipeline will be located at Kochi, Coimbatore, Chennai, Bengaluru, Hyderabad, Noida, Ambala, Pune, Indore, Ahmedabad, Kolkata, Patna, and Lucknow, etc. With advanced features and capabilities, the STCs will further strengthen our supply chain and warehousing competencies. We have plans to build eight super hubs in the next two years at an investment of Rs.40 crore. We are on a mission to take GATI to the next level of growth with enhanced efficiency to offer superior customer experience under the framework of the Allcargo Group.