Logistics Costs to Drop Soon

22 Oct 2024 CW Team

India's logistics costs are set to fall to single digits within the next two years, according to Union Minister Nitin Gadkari. This reduction will be achieved through ongoing infrastructure development and government initiatives aimed at enhancing transportation efficiency across the country. Currently, India's logistics costs, which hover around 13-14% of GDP, place a burden on manufacturing and exports, making the country less competitive in global markets.

The government is focusing on multiple areas, including improving the road network, expanding railways, and enhancing port connectivity to streamline freight movement. Initiatives under the Gati Shakti plan, which seeks to boost the integration of different modes of transport, are expected to play a significant role in reducing these costs. The Ministry of Road Transport and Highways is also prioritizing the use of green energy solutions and alternative fuels to ensure more cost-effective and sustainable logistics.

Reducing logistics costs will provide a major boost to India's manufacturing sector, which relies heavily on the efficient movement of goods across the country. It will also improve the country’s global competitiveness by enabling companies to transport products at lower costs, thus enhancing export potential. Additionally, as logistics costs decrease, consumers could see lower prices for goods, further contributing to economic growth.

The Indian government’s emphasis on infrastructure modernization, combined with innovative technological solutions, is expected to significantly cut costs in the supply chain and logistics sector. With this improvement, India is poised to better integrate with global trade systems, enhancing both its manufacturing capacity and export potential. The logistics sector’s transformation will be critical in driving economic progress, benefiting industries and businesses across the board.

Infrastructure Urban

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