Challenges and scope of logistic sector in India

The overall goal of any logistic company in air or sea cargo is to reduce the operational costs, improve efficiency and achieve the satisfaction of customers by delivery their products safely on record time. The importances of logistic operations are increasing because world economy is becoming highly globalised and interdependency is increase among nations and blocks of nations. Not only multinational companies but even small and medium range companies are sourcing products from different countries and supplying to different parts of the globe.

The growth of Indian economy in the recent years has increased the size of logistic business in India..However , there are some concerns due to lack of infrastructure development ,  inefficiencies in transport , lack of storage facilities at major ports , delay in loading and unloading at ports due to lack of advanced facilities , tax structure and untrained professionals working at various levels .

The most of the cargo International Parcel Service in Kandivali before reaching ports and air ports has to be transported by roads. The rail is efficient means of transportation of cargo but the railways cargo has reached the point of saturation. There has been little increase in railways tracks since independence. The increase is not matching the demand for railway for cargo movement. The second issue is the freight rates of the railway are high. This is because the government has been subsidizing the passenger tickets costs by freight rates. The road quality is also poor and in raining seasons the quality of roads at some places gets worse.    The truck industry is highly fragmented; this increases the competition and forces the truck owners to overload the trucks.

The ports sector also is facing problems due to congestion and slow unloading of ships. The coastal shipping has not developed to the expected level due to lack of ports and related infrastructure development.

The storage facilities have not come up because land acquisition is major problem in India. The political parties also cannot go beyond a point because it affects their electoral prospects. Unless cold storage facilities are developed, the movement and trade of several perishable goods cannot take off.

The payment of tax at several places reduces the time in transportation and increase the cost of transportation. The current GST bill envisages single tax structure as panacea for all intra country cargo movements’ problems.

Since there lack of big investment in cargo industry, the training level of personals associated with industry at various level also remains low. The creating climate for investment will lead to better management practice International Parcel Service in Borivali being implemented to improve the efficiency of logistic industry. This will automatically force companies to either hire trained personals or train existing staff.