India's Industrial and Logistics Space Growth to Surpass 25% Annually
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Synopsis
India's logistics sector is growing rapidly, driven by investments, digital transformation, and policy initiatives. Projections suggest growth may exceed 25% annually by 2025, building on last year's successful absorption.
Key Takeaways
- Logistics sector growth driven by investments and policy support.
- Projected growth to exceed 25% by 2025.
- Key logistics hubs include Mumbai, Chennai, Pune, and NCR.
- Digital twins technology will enhance warehouse operations.
- Cold storage logistics demand is set to rise significantly.
Mumbai, Feb 10 (NationPress) The logistics sector in India is experiencing a rapid evolution, driven by rising investments, digital innovations, and strong governmental policies. Projections indicate that by 2025, the sector could surpass the 25 percent annual growth rate recorded in the previous year for industrial and logistics space absorption, according to a recent report released on Monday.
The warehousing and logistics industry contributes approximately 13-14 percent to India's GDP and is expanding to meet the demands of the country’s swift economic growth.
“In the first half of 2024, this sector attracted 66 percent of all private equity investments across various asset classes,” noted Ankita Sahu from ANAROCK Capital.
The demand for logistics space is primarily fueled by third-party logistics (3P) providers, e-commerce platforms, retail enterprises, and manufacturing firms.
Key logistics hubs such as Chennai, Mumbai, Pune, and the NCR region are expected to remain pivotal in 2025, as logistics park developers actively seek opportunities for land acquisition to establish warehouses and fulfillment centers in these strategic markets.
The report highlights that absorption in industrial and logistics spaces saw an impressive 25 percent year-on-year growth in 2024.
A strong governmental push is evident, marked by several policies and initiatives introduced in recent years to support sector growth.
“Initiatives like PM Gati Shakti and the National Logistics Policy will play a crucial role in addressing ongoing challenges,” Sahu stated.
The recent Union Budget 2025 emphasized infrastructure as a top priority, enhancing public-private partnerships and supporting the private sector in project planning, including making data and maps from the PM Gati Shakti portal accessible.
The budget also proposed improvements in infrastructure and warehousing for air cargo operations.
Numerous multi-modal logistics park projects are currently in the planning and development stages under public-private partnerships, which are expected to reduce transportation costs significantly.
With an emphasis on technological advancements, 2025 is anticipated to mark the adoption of 'digital twins'—a virtual model of warehouses that simulates physical processes in real-time.
This development will enable the logistics sector to optimize warehouse operations and manage inventory and supply chains more effectively, helping to identify potential inefficiencies and enhance overall performance.
The growth of organized retail chains, the rising number of quick-service restaurants (QSRs), increased food consumption, last-mile delivery services, the farm-to-fork supply chain concept, and advancements in pharmaceuticals are all contributing to a heightened demand for cold storage logistics in India, projected to surge in 2025, as per the report.
