In a decisive policy push reflecting the changing global trade paradigm, India is accelerating its logistics infrastructure development to enhance resilience, reduce costs, and future-proof its supply chain ecosystem. This strategic shift aligns with international trends where geopolitical tensions, pandemic disruptions, and climate risks have redefined the traditional cost-optimised ‘just-in-time’ model towards a more robust, diversified, and shock-absorbing ‘just-in-case’ system.
Why is India prioritising logistics infrastructure now?
Over the past two years, several factors have driven this policy urgency:
- Geopolitical shifts and nearshoring trends, with firms looking to diversify away from overdependence on China.
- Disruptions caused by COVID-19 lockdowns and port closures, exposing fragility in integrated global value chains.
- Rising global freight rates and bottlenecks, amplifying the need for domestic efficiency.
- India’s ambition to become a $5 trillion economy, which demands globally competitive supply chain standards.
The Union Budget 2025 reaffirmed logistics modernisation as a national priority, allocating over ₹1.2 lakh crore towards rail, road, port, and multimodal connectivity upgrades under the Gati Shakti National Master Plan.
Key initiatives under India’s logistics resilience drive
| Initiative | Details |
|---|---|
| PM Gati Shakti National Master Plan | ₹100 lakh crore holistic infrastructure blueprint integrating roads, railways, ports, airports, and logistics hubs to cut costs and transit times. |
| National Logistics Policy (NLP) | Aims to reduce logistics cost from 14-15% of GDP to 8-10% by 2030 through digital integration, skill building, and regulatory reforms. |
| Dedicated Freight Corridors (DFCs) | Eastern and Western DFCs nearing completion, set to decongest passenger lines and ensure faster goods movement. |
| Multimodal Logistics Parks (MMLPs) | 35 planned MMLPs to provide end-to-end cargo aggregation, storage, and transport services. |
| Sagarmala and Bharatmala projects | Port modernisation and national highway development to ensure last-mile connectivity to manufacturing hubs. |
Global context: Shift from efficiency to resilience
Traditionally, global supply chains focused on maximising efficiency, minimising inventory, and using the cheapest available routes. However, the Ukraine crisis, US-China trade tensions, Red Sea attacks, and pandemic lockdowns triggered a re-evaluation of these models.
Major shifts include:
- Building multiple supplier bases instead of single-country dependence.
- Increasing regional warehousing and storage capacities to manage sudden demand spikes or route disruptions.
- Investments in digital supply chain visibility tools for real-time risk monitoring.
- Nearshoring and friendshoring to align trade with geopolitical partnerships.
India’s policies align with these shifts, positioning the country as a preferred resilient supply chain node in Asia.
Progress so far: Achievements in logistics modernisation
- Western Dedicated Freight Corridor operational segments have cut transit times by up to 50%, boosting export competitiveness for sectors like textiles, engineering goods, and chemicals.
- First Multimodal Logistics Park in Jogighopa, Assam, nearing completion, expected to catalyse regional connectivity with Bangladesh, Bhutan, and Nepal.
- Sagarmala projects have added 200+ million tonnes per annum (MTPA) port capacity over five years.
- ULIP (Unified Logistics Interface Platform) under NLP has integrated over 30 systems of seven ministries, reducing paperwork and approval delays for logistics operators.
Sector-wise impact of logistics resilience push
| Sector | Key impact |
|---|---|
| Manufacturing | Faster transit and reliable delivery timelines to domestic and export markets. |
| E-commerce and retail | Reduced last-mile delivery costs and improved rural outreach. |
| Agriculture and food processing | Cold chain and multimodal parks ensure reduced spoilage and higher farmer incomes. |
| Automotive | Seamless transport of components and finished vehicles across plants and ports. |
| Pharmaceuticals | Better temperature-controlled storage and regulatory compliance for global exports. |
Industry voices on the shift
Rajesh Kumar, MD, Delhivery Logistics Solutions, noted:
“Resilience has overtaken mere efficiency as a supply chain priority. Clients now ask about contingency routes and storage backup, not just fastest delivery times.”
Renu Sharma, supply chain professor at IIM Ahmedabad, added:
“India’s investments in multimodal hubs, DFCs, and policy reforms under NLP reflect global best practices towards shock-absorbent supply chains that can withstand geopolitics and climate disruptions.”
Challenges to address
Despite commendable progress, experts caution against:
- Land acquisition delays slowing MMLP implementation timelines.
- Inter-ministerial coordination issues, as logistics cuts across transport, commerce, and state governments.
- Skill gaps in digital logistics management, warehousing automation, and supply chain risk analysis.
- Need for private sector investments in fleet modernisation and cold chain infrastructure.
Way forward: Future plans under consideration
Government sources indicate upcoming focus areas:
- Expansion of DFC network beyond Western and Eastern corridors to Southern and East Coast regions.
- PPP models for MMLPs to ensure operational efficiency and technology adoption.
- Green logistics initiatives including EV freight fleets, solar-powered warehouses, and LNG-powered heavy vehicles.
- Strengthening inland waterways connectivity under Jal Marg Vikas Project to reduce road congestion.
- Integration with global value chains through FTAs and economic corridors like IMEC (India-Middle East-Europe Corridor).
Conclusion: India’s strategic logistics shift
The global supply chain narrative is no longer about cheapest routes or zero inventory systems alone. It is about:
- Ensuring operational continuity despite geopolitical shocks.
- Building redundancies and backups without disproportionately raising costs.
- Creating a logistics ecosystem that catalyses exports, manufacturing, and jobs.
India’s infrastructure investments, policy reforms under NLP, and digital integration under ULIP position it strongly to emerge as Asia’s resilient supply chain hub, aligning with its economic growth aspirations in an increasingly fragmented global trade order.
Disclaimer
This article is based on official government announcements, industry interviews, and market trend analyses as of July 2025. Readers are advised to consult detailed policy documents and trade advisories before drawing business or investment conclusions. The publication bears no responsibility for actions taken based on this news content.
