India's logistics costs have decreased to 9%, as reported by Nitin Gadkari, with further reductions expected by December 2025 due to highway network expansion. This decline, from 16% to approximately 10%, enhances export competitiveness by lowering warehouse-to-consumer costs by 1.33%. The government aims for a 9% target by December, boosting the country's economic competitiveness.
India's Logistics Costs Decline to 9%
India's logistics costs have decreased significantly to 9%, as recently reported by Nitin Gadkari. The country has seen a notable reduction in logistics expenses, which are expected to continue declining to around 9% by December 2025. This development is a result of strategic infrastructure improvements, particularly in the expansion of the highway network.
Infrastructure Developments Drive Cost Reduction
The decline in logistics costs can be attributed to a series of infrastructure projects that have been implemented across the country. The expansion of India's highway network has played a crucial role, leading to a 5-6% reduction in overall logistics expenses. Additionally, the cost of transporting goods from warehouses to consumers has decreased by 1.33%, further contributing to the overall cost reduction.
Export Competitiveness Enhanced
Lower logistics costs are a significant factor in enhancing India's export competitiveness. With logistics costs reduced from 16% to approximately 10%, Indian goods are now more competitively priced on the global market. This reduction is expected to boost India's position as a major player in international trade.
Government's Strategic Goal
The Indian government has set an ambitious target date of December for achieving the logistics cost reduction to 9%. This goal is part of a broader strategy to enhance the country's economic competitiveness. The anticipated reduction in logistics costs aligns with government efforts to improve infrastructure and streamline supply chain operations.
Future Outlook
Looking ahead, the continued focus on infrastructure development and strategic policy implementation is expected to further lower logistics costs in India. As these initiatives progress, the country is poised to strengthen its economic standing and improve its trade balance by making exports more appealing to the global market.
“Logistics costs have a direct impact on the pricing of goods. Reducing these costs not only benefits businesses but also makes Indian products more attractive globally.”
The concerted efforts to reduce logistics costs reflect a long-term commitment to enhancing the efficiency of India's supply chain networks. As these efforts bear fruit, the country is likely to see continued improvements in economic performance and international trade relations.