India is rapidly strengthening its position as a global trade and production hub, to address key barriers to competitiveness, writes Nitin Navneet Tatiwala, Vice President Marketing, Customer Experience, and Air Network, MEISA at FedEx
India’s logistics sector is at an inflection point. As the country targets a USD 5 trillion economy with policy reforms, digital transformation, and multimodal infrastructure investments. India is rapidly strengthening its position as a global trade and production hub, to address key barriers to competitiveness such as inefficiencies in supply chain infrastructure, high logistics costs, and fragmented trade networks.
Infrastructure: Strengthening Trade Foundations
A robust logistics infrastructure is essential for seamless trade execution and India’s deeper integration into global supply chains. Investments in Dedicated Freight Corridors (DFCs) are helping to reduce transit times, cut costs, and enhance cargo movement across key trade routes.
To further improve multimodal connectivity, the government is investing Rs 50,000 crore in 35 Multi-Modal Logistics Parks—strategically located to integrate road, rail, and air transport. These parks offer real-time tracking, automated customs clearance, and warehousing solutions, enabling businesses to scale with greater efficiency. Additionally, cargo hubs near major ports, airports, and industrial clusters are enhancing freight distribution and reducing bottlenecks—resulting in faster movement of goods for MSMEs and large exporters alike.
Digital Transformation: Optimising Supply Chains with Technology
While infrastructure improvements are vital, technology integration is the game-changer in India’s supply chain evolution. AI-driven logistics, predictive analytics, and automation are enabling real-time decision-making, the reduction of inefficiencies, and improvement of inventory management.
· Bharat Trade Net, a single-window trade platform, is simplifying customs clearance, documentation, and financing to reduce trade delays and paperwork burdens for businesses.
· Applying AI-driven forecasting to supply chain management, for example, can reduce errors by between 20 and 50 per cent.
· Blockchain technology is strengthening trade security and reducing fraud and documentation errors in cross-border transactions.
· Cloud-based logistics platforms are offering end-to-end visibility, allowing businesses to dynamically adapt to supply and demand fluctuations.
India’s logistics sector is also undergoing a structural shift, with organised players expected to grow at a CAGR of 32 per cent between 2022 and 2027. By FY27, their market share is projected to increase from 5.5-6 per cent to 12-15 per cent driven by companies leveraging integrated logistics services and scaling efficiencies.
Sustainability: The New Competitive Advantage in Global Trade
Sustainability is no longer just a regulatory requirement—it can be a key differentiator for Indian exporters. As global buyers increasingly prioritise solutions that reduce emissions and waste in their supply chains, Indian businesses must integrate sustainability into their logistics strategies to remain competitive and attract foreign investment.
· Adoption of electric vehicles (EVs) and alternative fuels is reducing operational emissions and can cut maintenance costs.
· Energy-efficient warehousing solutions, including solar-powered storage facilities and energy-efficient automation, can improve operational sustainability and resiliency.
· Public-private partnerships (PPPs) are enabling specialised logistics solutions, such as cold chain infrastructure for perishable goods—ensuring minimal wastage and higher export quality compliance.
Integrating AI-driven efficiency with sustainability can strengthen India’s supply chains, reduce trade friction, and meet evolving global trade standards.
A Resilient and Future-Ready Supply Chain
India’s logistics ecosystem is transitioning from a traditional, fragmented model to an integrated, AI-powered trade enabler. Policy initiatives such as PM Gati Shakti and the modified UDAN scheme are further improving regional connectivity and strengthening multimodal logistics networks.
With the right mix of policy execution, private-sector investment, and digital innovation, India is poised to become a global leader in resilient, agile, and sustainable supply chains—powering its journey toward a USD 5 trillion economy.
