India’s logistics costs are projected to drop below 9% of GDP by April next year, thanks to government investments in infrastructure and technology improvements in the sector.
- Union Minister Nitin Gadkari announced a significant reduction in logistics costs in India, expected to fall below 9% of GDP by April next year.
- Currently, logistics costs in India are around 13-14% of GDP, higher than in developed countries where costs are under 10%.
- High logistics costs have historically affected the prices of goods and services in India.
- The government aims to enhance logistics efficiency through various initiatives, including:
- Infrastructure development like highways, expressways, and multimodal logistics parks.
- Implementing technology-driven solutions, enhancing digitisation with GPS tracking, automated warehousing, and integrated supply chain management.
- Improved logistics costs will benefit key sectors such as manufacturing and agriculture, making them more competitive internationally and domestically.
- The anticipated reduction is expected to attract more foreign investment into India’s industrial and manufacturing sectors, contributing to economic growth.
- Overall, this is seen as a major step in the government’s efforts to create a more competitive and efficient economy.