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Logistic sector remained fairly muted in July, expects robust growth on yearly basis

24th Aug 2023, Thursday / Top Stories

In an evolving landscape logistics sector has seen a continuous evolution despite facing several problems and obstacles. The industries are thriving with various innovations and technology advancement, process automation etc. Thus, the logistics industry is expecting better growth in the coming year.

India is one of the countries with the largest population and an expansive geographical coverage contributing to many factors that influence logistics in the country.

ICRA’s reports suggested a growth rate of 14-17 % for the 21-22 fiscal year. Moreover, around 14.4 % of the GDP is accounted for by the logistics industry.

However, the domestic logistics activity was stable in July 23 with daily average e-way bill generations decreasing ~1% MoM. Fleet utilization stood approximately between 80-85% during the month the data suggests. There has been decline in the daily average FASTag toll collections by 7% MoM in July’23.

However, the EXIM container volumes handled by the Indian Railways has shown a growth by 10-11% YoY, with its market share in EXIM containers increasing to 37% as of July’23 (from 32% in Jun’23). Overall container volumes handled at ports increased by 9% YoY during the month. Volumes handled at major ports also rose 4.4% YoY to 66.2 million metric tonnes. Iron Ore/Fertilizer/Container volume grew 137%/40%/11 YoY, while Coal volumes dipped by 19% YoY and the consumption of diesel decreased by 13% MoM to 6.9 million tonnes in July’23.

As per the research, the value of the logistics industry stood $250 billion in 2021 and is expected to reach $380 billion by 2025.  There is a good potential for this industry to see robust growth with regards the challenges being handled properly.

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