India's $360 bn infra-investments slashes logistics cost: Report
New Delhi, May 29
Cumulative investments of nearly $360 billion in infrastructure development over the last decade have translated into estimated annual savings of $123-133 billion for the Indian economy, a joint report said on Friday.
The joint report from CII and Knight Frank India said the India's logistics cost have been slashed to about 10-10.7 per cent of GDP in FY 2026, from 13-14 per cent of GDP a decade ago due to infrastructure investments.
The firm said that the country's position in the global logistics performance index improved from 54th in 2014 to 38th in 2023, reflecting enhanced connectivity, trade facilitation, and supply chain performance.
Despite these improvements, India's logistics supply chain is yet to achieve optimal efficiency, the report said, noting that Multimodal Logistics Parks (MMLPs) are central to improving India's logistics efficiency.
"India will require 216 MMLPs, each with an average capacity of 16-17 MMT per annum, to achieve its 2047 freight modal shift targets," the firm said.
Continued overdependence on road transport for freight movement, delays in the development of integrated Multimodal Logistics Parks (MMLPs), and inadequate first- and last-mile connectivity continue to limit the shift of cargo movement towards rail and other efficient modes of transport.
"The core challenge is no longer an infrastructure deficit, but a lack of connective nodes... By aggregating fragmented, sub-threshold cargo, MMLP-grade interchange unlocks a monumental 43 per cent total cost advantage over road freight on DFC corridors," said Ashwani Gupta, Chairman, CII National Committee on Ports and Shipping and Whole Time Director & CEO, Adani Ports and SEZ.
To achieve the National Rail Plan's target of a 45 per cent freight modal share by 2047, India must aggressively scale its intermodal network, he added.
Germany, the Netherlands, and Singapore have demonstrated that integrated logistics parks significantly improve supply chain integration, operational efficiency, and modal balance.
The report urged accelerating private sector participation in MMLPs through fast-tracking project implementation, creating anchor demand through industrial clustering and freight aggregation, and addressing critical first- and last-mile connectivity gaps.
— IANS
Reader Comments
Impressive numbers but I'm skeptical about how much of this actually benefits the common man. $123-133 billion savings sounds great on paper, but have transportation costs really come down for everyday goods? My grocery bill doesn't seem any cheaper. Curious to see how this translates to actual consumer prices.
As someone working in the logistics sector, I can confirm the improvements are real. The Dedicated Freight Corridors have been a game-changer for moving goods faster. But the over-reliance on road transport is a genuine concern - we need more rail connectivity especially for bulk goods. MMLPs are the way forward, but they need to be executed properly, not just on paper.
The jump from 54th to 38th in the logistics performance index is no small feat! But I hope we're not just focusing on highways and ignoring rural connectivity. Many farmers in my village still struggle with bad roads to transport produce. Infrastructure should benefit everyone, not just big companies.
This is a classic case of 'good but not good enough'. While $360 billion investment is massive, the fact that logistics costs are still 10-10.7% of GDP versus Germany's ~8% shows we need more efficiency. The MMLP plan seems logical but 216 parks by 2047 sounds ambitious - let's see if we can actually deliver.
I work with a logistics company that uses the DFC corridor - the time savings are real. But the report is right about one thing: first and last mile connectivity is still pathetic in many areas. You
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