India’s logistics sector is anticipated to grow to $362 billion by FY30 from $246 billion in FY25, with a compound annual growth rate (CAGR) of 8%. This growth is attributed to increased consumption, expanding trade, and efficiency gains from government schemes. The report by Brickwork Ratings also forecasts the freight volume to surpass 7,100 million tonnes by FY30, up from around 5,000 tonnes in FY24, at a CAGR of 6.1%.
“Manufacturing, construction, e-commerce, and retail are driving the growth in freight volume. The express logistics segment is expected to expand by 14%, playing a crucial role in the industry,” noted Manu Sehgal, CEO of Brickwork Ratings. Manufacturing holds the largest market share in the logistics sector, with 18% in FY25, fueled by industrial production, advancements in auto and pharma sectors, and export demand.
The warehousing and supply chain services segment is experiencing rapid growth, supported by increased investments and the formalization of the organized market due to GST. West India leads this growth, with a 35% share, driven by Mumbai’s financial prominence, major ports, and strong industrial presence in Gujarat. Following closely, North India holds around 30%, benefiting from strategic transit positioning, robust infrastructure, and key hubs like Delhi-NCR.
South India contributes approximately 25% to the sector, backed by port infrastructure, IT-driven cities, and manufacturing activities. East India, with a 10% share, is rapidly growing due to port-led trade, enhanced connectivity, and its strategic gateway position to the Northeast and neighboring countries. India’s logistics cost, at 8% of GDP, is comparable to South Korea, the USA, and Europe, and significantly lower than China’s estimated 14% in 2023.
Efforts like Dedicated Freight Corridors and PM Gati Shakti aim to further reduce logistics costs. The logistics ecosystem in India is predominantly reliant on road transport, holding a 65% market share, while rail accounts for 31% of freight transportation.
