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Indian Logistic Industry

The document discusses the Indian logistics industry. It notes that logistics costs account for 14% of India's GDP, with 99% of the industry being unorganized. Reducing logistics costs to 9% of GDP could save $50 billion annually. Key challenges include high costs and lack of scale, complex regulations and taxes, poor infrastructure, and a shortage of skilled workers. However, the future prospects are positive - large companies are entering the market, entrepreneurs see opportunities, and government investment in infrastructure is growing as outsourcing awareness increases with economic growth.

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Ritesh Bansal
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289 views7 pages

Indian Logistic Industry

The document discusses the Indian logistics industry. It notes that logistics costs account for 14% of India's GDP, with 99% of the industry being unorganized. Reducing logistics costs to 9% of GDP could save $50 billion annually. Key challenges include high costs and lack of scale, complex regulations and taxes, poor infrastructure, and a shortage of skilled workers. However, the future prospects are positive - large companies are entering the market, entrepreneurs see opportunities, and government investment in infrastructure is growing as outsourcing awareness increases with economic growth.

Uploaded by

Ritesh Bansal
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Indian Logistic Industry

Introduction To The Topic


• To know customer’s expectation and experience of service
provided by 3PL operators.

• To identify customer needs and how well 3PL providers are


responding to those needs.

• To provide a strategic assessment of the future of the 3PL


industry.
Indian Logistic Industry
The logistics cost in India is estimated to be 14% of
the GDP
Almost 99% is accounted for by the unorganized
sector and slightly more than 1%, is contributed by the
organized sector
Nascent stage
Logistics cost from 14% to 9% of the GDP (level in the
US), savings to the tune of USD 50 billion will be
realized at the current GDP level, making Indian
goods more competitive in the global market.
Problems and Challenges
•Logistics is a high-cost, low-margin business.
•Economies of scale are absent in the Indian logistics industry.

•Non-uniform tax structure, numerous other taxes, octrois,


multiple check posts and police harassment.

•Complexities of paperwork and formalities and various taxes,


which include the excise duty on fuel.

•Lack of trust and awareness among Indian shippers with


regard to outsourcing logistics.
Problems and Challenges
•Poor physical and communications infrastructure.

•Low penetration of IT.

•Most of the 3PL operators are of relatively small size, they


cannot provide the entire range of services.
•
•Service tax levied on logistics service fees.

•Lack of skilled and knowledgeable manpower in the logistics


sector
Future Prospects
•Large Indian corporate such as Tata and Reliance Industries
have been attracted.
•Large Express cargo and courier companies such as
Transport Corporation of India (TCI) and Blue Dart have also
started logistics operations.
•Logistics service can be provided without assets, there is
growing interest among entrepreneurs to venture into this
business
•awareness of the benefits of logistics outsourcing.
•The Indian economy’s growth
•The Indian government is focusing on infrastructure
development(100% FDI)
Chennai Region

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