Indian logistics market to grow at 8.8% annually to $484.43 bn by 2029 (2024)

FAQs

What is the growth rate of logistics industry in India? ›

In the year 2022, the size of the Indian logistics market was around 274 billion U.S. dollar. It was estimated that this market would grow to 563 billion dollars by 2030, at a compound annual growth rate 15.5 percent.

Economic Survey 2022-23 told us, “logistics costs in India have been in the range of 14-18 per cent of GDP against the global benchmark of 8 per cent.” That kind of range floats around.

India's logistics are estimated to account for about 14.4% of GDP and more than 22 million people rely on it for their income. The Department of Commerce's logistics division for India is given the responsibility for the Integrated Development of Logistics Sector.

Industry Performance

In 2022, the size of the Indian logistics market was estimated to be around 274 billion U.S. dollars, with expectations of further growth [3]. The logistics sector in India is valued at USD$ 150 billion, contributing 14.4% to the country's GDP [4].

This information has been provided by the Union Minister of State for Commerce and Industry, Shri Som Parkash in a written reply in the Lok Sabha today. According to the World Bank's 'Logistics Performance Index Report (2023): Connecting to Compete 2023', India ranks 38 out of 139countries.

The industry operating profit margin contracted to 11.2% in 9M FY2024 (down ~150 bps YoY), on account of increase in operating costs (ex-fuel) due to the high inflationary regime, and pressure on realisations, given the sticky retail diesel rates, limiting any formula-driven price rise.

India's logistic costs ranged between 7.8 percent and 8.9 percent of the GDP during 2021-22, down from 8.7-9.9 percent during 2011-12, the NCAER said in a report written for DPIIT and released on 14 December.

The logistics industry is the pillar of any economy, and again, there are high expectations from Budget 2024. The primary aim is to reduce logistics costs from 14% of GDP to 8%–10% of GDP. Further, there should be a focus on infrastructure development for faster TAT and seamless movement of goods.

Logistics cost in India as a percentage of GDP is 16%, which is very high, he said, adding that it is 10% in China and nearly eight per cent in the U.S. and Europe.

How much is India's GDP growth rate? ›

In fact, according to Statista, the Indian logistics industry is poised to expand at a CAGR of 10-12% to reach a market value of $380 billion by 2025. This growth will lead to several trends significantly impacting the market's development.

The revenue in the Third Party Logistics (3PL) market in India is forecasted to reach US$35.86bn in 2024. This revenue is anticipated to demonstrate an annual growth rate (CAGR 2024-2028) of 2.99%, leading to an estimated market volume of US$40.35bn by 2028.

The transport sector has been a focal point for the government and it is also expected to receive significant investments going forward. The sector is expected to grow at approximately 4.5% compounded annual growth rate (CAGR) from 2022 to 2050.