India’s logistics sector poised to reach ₹47.12 lakh crore by 2030, driven by innovation and policy reforms | Representational Image
Mumbai: India’s logistics sector, already one of the largest in the world, is undergoing a profound transformation. A study — named “a report on future talent requirements in logistics” — by a group of academics and experts in the logistics sector reveals that the sector is set to reach a market value of ₹47.12 lakh crore by 2030, driven by an array of technological advancements, policy reforms, and an increasing demand for more efficient supply chain solutions.
The report prepared by Ashish Chouhan (CEO and MD of National Stock Exchange), Manoj K Tiwari (Director, Indian Institute of Management Mumbai) S G Deshmukh (Professor Indian Institute of Technology Delhi), and Ketan Kulkarni (chief growth officer, Allcargo Logistics), among others, also highlights the issues faced by the sector and how to address those challenges.
The study highlights that India’s logistics performance has significantly improved in recent years. According to the World Bank’s Logistics Performance Index (LPI), India climbed from 42nd place to 38th in 2023 out of 139 countries. This achievement is largely attributed to the central government’s sustained efforts through strategic initiatives.
Among the most prominent of these are the National Logistics Policy, the PM Gati Shakti National Master Plan, and the Sagarmala and Bharatmala projects, which aim to enhance the nation’s infrastructure and ease of logistics operations, according to the study.
Alongside these projects, the government has introduced the Dedicated Freight Corridors, e-Way Bill System, and Logistics Data Bank (LDB), all of which aim to streamline operations, reduce costs, and facilitate the smooth movement of goods, the report adds.
Challenge of talent shortages
However, despite these positive developments, the logistics sector is facing considerable challenges in workforce development. According to the study, 77% of employers in the transportation, logistics, and automotive industries across India reported significant talent shortages in 2023.
The percentage of employable talent in the country has increased to just over 51% in 2024, up from 50% the previous year. Yet, even with this modest rise, the report underscores that less than half of the available workforce is considered suitable for employment, highlighting a continued mismatch between market demands and available skills. As the sector prepares to create an estimated 10 million new jobs by 2027, bridging this talent gap remains a critical challenge.
A key area of transformation identified in the study is the integration of technology into logistics operations. The report notes that while the industry is currently operating at a digitisation level of 43%, the potential for growth is substantial.
The adoption of big data analytics, blockchain technology, and the Internet of Things (IoT) is revolutionising logistics operations, enabling more efficient supply chain management, real-time monitoring, and agile decision-making.
The study points out that the integration of autonomous vehicles and drones, alongside advancements in augmented and virtual reality, are expected to further transform operations in warehouses and supply chains. In line with these technological advancements, McKinsey estimates that increased digitisation could lead to a 3.2%increase in annual EBIT growth and 2.3% revenue growth for companies embracing these innovations.
Role of sustainability
The role of sustainability in the future of logistics is another important aspect of the report. As global industries face increasing pressure to reduce their carbon footprints, the logistics sector is incorporating decarbonisation strategies and investing in energy-efficient technologies.
The report highlights the industry’s growing focus on sustainable practices, including the use of electric vehicles and drones, as well as efforts to improve fuel efficiency and reduce emissions. This shift towards greener logistics aligns with broader global objectives to foster a more sustainable and eco-friendly supply chain ecosystem.
Alongside these technological and environmental transformations, the study calls for urgent action in workforce development to meet the sector’s future demands. One of the key recommendations is a curriculum redesign to ensure that educational programmes align with the evolving needs of the logistics industry.
The study suggests incorporating courses on emerging technologies such as AI, big data, and blockchain, as well as on supply chain management and sustainability. Additionally, vocational training is urged as a critical strategy to enhance the employability of individuals, particularly by leveraging digital platforms to reach a broader pool of students and professionals across the country.
Addressing talent shortages
“The report pinpointed the talent shortages and skillset requirements in the transportation, logistics & automotive industries. Considering digitisation, automation, and technological advancement, we recommended curriculum redesign/upgradation, training and development of current and future workers, vocational training, training on soft skills, etc,” Professor Manoj K Tiwari, IIM director and an author of the report, told the Free Press Journal.
In addition to academic and vocational training, the study also emphasises the importance of faculty training. “This includes keeping educators abreast of the latest industry trends and technological developments to ensure that they are prepared to impart relevant knowledge to the next generation of logistics professionals,” said Professor Tiwari.
Encouraging more women to join the sector
Promoting diversity in the logistics workforce is another key recommendation of the study. Encouraging more women to enter the sector is seen as an important way to tap into untapped potential and bring fresh perspectives to an industry that has traditionally been male-dominated.
“As logistics becomes increasingly digitised and technology-driven, the study argues that women, who often excel in areas such as communication, collaboration, and critical thinking, can bring valuable skills to the table,” Professor Tiwari added.
Bridging the gap
The report also stresses the need for increased industry-academia collaboration. It calls for more partnerships between educational institutes and logistics companies to bridge the gap between theory and practice. Initiatives such as internships, guest lectures, and industry-sponsored research projects are all cited as crucial for ensuring that students are adequately prepared for the challenges they will face in the workforce.
India’s logistics sector is on the brink of a major transformation, and with the right policies and strategies in place, it is well-positioned to become a global leader.
“As the sector embraces sustainability, technological innovation, and workforce development, it will create millions of jobs, drive economic growth, and pave the way for a more efficient and sustainable logistics ecosystem,” said the IIM director.
