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Logistics is the backbone of every economy, providing efficient, customer-centric and cost-effective flow of goods on which all commercial sectors depend. The sector comprises of Shipping, Port-services, Warehousing, Rail, Road and Air Freight, Express cargo and other value-added services. Optimal use and integration of these services is essential for a seamless supply-chain. The global logistics market currently generates over USD 8 trillion annually and represents around 11% of global GDP.
India remains one of the fastest growing economy in the world. The Indian Freight transport market is expected to record a CAGR of 13.35% by 2020, driven by the growth in the manufacturing, retail, FMCG and e-commerce sectors. International trade is likely to remain the major drivers for Freight Forwarding and transportation companies. Indian Government’s focus is on improved transportation infrastructure, industrial and economic reform initiatives such as ‘Make in India’, ‘Digital India’, and ‘Skills India’. These would promote growth of International business, which is the key to drive growth opportunities for Indian Logistics Service Providers.
The Indian Freight Forwarding industry has moved from being just a ‘service-provider’ to provider of end-to-end supply chain solutions.
FIATA World Congress 2018 will help the Freight Forwarding industry realize the untapped growth opportunity within their supply chains for doing business in India. End to End global logistics solutions, customer centricity, new business opportunities - the future for a global logistics network starts here.
India will be in the top 5 economies of the world soon and each country would see a growth in the cargo movements between them and India.
Opportunities galore for International Freight Forwarders – Come to the new land of opportunities.
The Indian logistics industry is witnessing unprecedented development and expansion of its existing infrastructure. This is mainly because of the emergence of technology-specific logistics solutions coupled with support from numerous Government initiatives in the areas of trade and industry promotion, logistics infrastructure development, and tax reforms.
The last five years have witnessed major investments by both the public and private sectors in infrastructure, technology upgrades, and expansion of all cargo related facilities in all modes of transports – sea, air and land. Dedicated logistics corridor’s in the rail network from Northern India to both coasts of India are soon to be operational.
In India, Freight Forwarders handle 98% of cargoes through Customs, and ship over 99% through various modes of transport on both cycles. Almost all manufacturing and trading companies outsource these functions. The presence of many multinational Freight Forwarding companies makes this space very interesting. The Indian Freight Forwarders are looking out for multiple partnerships in different countries for mutual benefit.
It is estimated that the present volumes can grow upto four times in the near future. This will translate into a huge potential, leading to transformational growth of the Indian logistics industry, and can be a game-changer.
India is an ideal place for investments in hard infrastructure, technology and basic Freight Forwarding services. With a clear licensing policy and legal framework, this democracy is the place to be in.
India spends around 14% of its GDP on logistics and transportation as compared to less than 8% by other developing countries. Studies have estimated that India can save up to US$45 billion if logistics costs are brought down to 9% of the country’s GDP, thereby making domestic goods more competitive in global markets.
India is at the forefront in implementing all the provisions of the Trade Facilitation Agreement, which would lead to transparency and speed. The changes have already been implemented. Custom clearance as well as clearance from other Border Agencies is now on a single platform and time bound. Time-release studies are an effective tool for measuring efficiencies. The recent rollout of GST should bring down distribution costs for organized players in the industry. It is expected that Logistics would be the biggest beneficiary as an industry of this single tax across the country. The integrated transport and logistics framework, smart cities, ease of documentation, logistics parks, and such developments will enable a reduction in the overall supply chain costs in the economy.
Coming September, New Delhi is the destination for International logistics providers to meet their trading partners in India, to explore and capitalize on opportunities to changing conditions and expand their businesses, during the 2018 FIATA World Congress, and have a peek to this vibrant and booming economy - India.