From bytes to billions - Data-driven logistics reshaping India's economy

India's logistics market, projected to reach $557.4 billion by 2032, is poised for transformation through data-driven decision-making. With current logistics costs at 16 per cent of GDP compared to 8-10 per cent in developed economies, the sector faces challenges but holds significant potential for improvement.

- Parijat Sourabh

In recent years, India has emerged as a global economic powerhouse, with its logistics sector playing an important role in this transformation. As the country continues to digitise and modernise its infrastructure, data-led decision-making has become increasingly crucial in optimising logistics operations.

India's logistics market overview:

India's logistics sector is one of the largest globally and is set to grow further according to data from IMARC Group, the market is set to reach $557.4 billion by 2032, exhibiting a growth rate (CAGR) of 7.85 per cent during 2024-2032.

Key factors contributing to market growth include the significant expansion of e-commerce and online retail, the implementation of supportive government policies that encourage logistics services adoption, and emerging technological advancements, mentions the report.

Challenges in the Indian logistics sector:

Despite its size and growth potential, the Indian logistics sector faces several challenges. The industry remains highly fragmented, with numerous small and medium-sized players competing alongside larger firms. Although improvements are being made, India's infrastructure still falls short in many areas, causing inefficiencies and delays.

“The infrastructure in India significantly influences the adoption and effectiveness of both barcode and Radio Frequency Identification (RFID) technologies in logistics. While major urban areas benefit from advanced logistics networks, including modern ports, highways, railroads, airports, warehouses, and distribution centres, remote regions often face challenges such as inconsistent internet connectivity, power outages, and limited access to logistics facilities. These hurdles can hinder the seamless implementation and operation of barcode and RFID systems, affecting supply chain efficiency,” says Praveen Kishore, Chief Transformation Officer, Bar Code India.