A key driver of India’s economic ambitions

By Sumita Dawra

In a rapidly evolving global trade environment, it is crucial to prioritise logistics efficiency as a key component of India’s strategic framework, alongside investments, trade, and supply chain integration. Strategic infrastructure development and digital innovations can greatly enhance our trade competitiveness whether India aims to serve global markets or deepen supply chain integration.

While India’s logistics sector is undergoing a transformation, driven by substantially enhanced capital investment in infrastructure, digitalisation of services, and regulatory reforms, it is timely to amplify this momentum. This would be relevant both for a more efficient inward movement of raw materials and components to manufacturing centres, as well as the outward movement of finished goods to the markets.

In a world impacted by the US tariffs, as well as the window of the 90-day tariffs pause, let us look at new trade opportunities before India. Indian freight forwarders have reported a surge in requests for quotations (RFQs) from domestic companies that are receiving new inquiries from US buyers. To fulfil aspirations of enhanced exports to US, our largest export market, India’s logistics system must be prepared to handle the expected volumes.

Regardless of how the next three months unfold, it is essential to look beyond immediate developments and adopt a longer-term strategic perspective — especially as we prepare for a bilateral trade agreement with the US, aiming for over $500 billion in bilateral trade by 2030, in line with India’s broader export target of $2 trillion by that year.

Given this context, it is critical to speed up the establishment of comprehensive logistics parks for products with high-export potential — such as electronics, textiles, garments, footwear, and electrical machinery. Simultaneously, the deployment of cutting-edge technology, including artificial intelligence-driven customs clearance systems at major ports, particularly for key export sectors like generic pharmaceuticals, textiles, and electronics, would significantly enhance the speed and efficiency of logistics operations.

These parks are designed to integrate multiple logistics related services at or near manufacturing hubs. This would include warehousing, packaging, inland container depots, customs clearance, and multimodal connectivity (rail and road). The parks would also integrate support services such as skill development centres, trade facilitation offices, and logistics innovation hubs.

To strengthen sector-specific logistics parks, a focused strategy should include rapid identification of suitable sites; speedy approvals and clearances; targeted investments in modern warehousing infrastructure; and the availability of a skilled workforce to manage digitised logistics operations.

A quick way forward would be to identify and undertake focussed improvements in road, rail networks, and last-mile connectivity gaps to ports, airports in strategic manufacturing clusters. This will facilitate Make in India and the upcoming National Manufacturing Mission too. Similarly, we need more port-led industrial zones, such as the multi-product special economic zone (SEZ) at Jawaharlal Nehru Port Authority, Mumbai, where businesses related to manufacturing, food processing, trading, warehousing have come up. Port-led SEZs help lower logistics costs significantly as well as help build transhipment related businesses.

Simultaneously, we need to develop applications on digital platforms to track movement of goods across various modes of transportation. A national e-marketplace for meeting logistics needs at competitive prices in real time would be an innovative and timely intervention to scale up logistics efficiency and support the exports thrust.

To enable real-time tracking of consignments and provide HSN code-level visibility into commodity flows, India has already launched the Unified Logistics Interface Platform (ULIP). This is a digital gateway that integrates over 30 logistics-related government systems. Standardised, nation-wide applications could be built on the ULIP platform to track and trace goods, bringing about an immediate improvement in supply chain efficiency, production planning, and last-mile deliveries.

India also uses the Logistics Data Bank (LDB) to track and trace export-import (EXIM) containers. Almost 3,000 RFID (radio frequency identification) readers installed at all major routes on roads and rail, including dedicated freight corridors, capture data on movement of containers. The data analytics gives useful feedback on port dwell time for containers, speed analysis of container movement, performance benchmarking across states, transit time, etc. Such a data-driven approach can help improve road and rail infrastructure for EXIM movement across states by highlighting the choke points in the transit route.

As the logistics sector becomes increasingly tech-enabled, it will be accompanied by a sharp rise in demand for a digitally skilled logistics workforce that covers various aspects like handling transportation, packaging, warehousing, customs operations, technology-enabled platforms at ports, and EXIM documentation, etc. At the same time, the logistics evolution is also opening exciting opportunities for start-ups and information technology service providers in fields like automation, predictive analytics, and supply chain visibility solutions.

India’s ambition to become a global manufacturing and export leader depends on how effectively it harnesses the strengths of its logistics ecosystem. Major initiatives such as the GIS-enabled PM Gati Shakti National Master Plan, dedicated freight corridors, multimodal logistics parks, digital platforms like ULIP, and proactive state-level logistics policies are laying the foundation for a logistics-driven growth strategy. With focused implementation, these reforms can enhance India’s ranking in the Global Logistics Performance Index and drive the Viksit Bharat goal of a $32-trillion-plus economy by 2047.

The writer is former secretary, ministry of labour and employment.

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