India 3pl Industry Boom

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India 3pl industry boom

India's economy is growing, and the logistics industry is growing along with it. A new study predicts that the nations logistics market is expanding at a double-digit rate and will total $125 billion by 2010. The report by Datamonitor, a London market analysis firm, said the growth would be driven by India's economic strength and efforts to improve its transportation and port infrastructure. The country's gross domestic product is growing at more than 9 percent a year, and its manufacturing industries are growing at double-digit rates, the report said. India's logistics market currently generates an estimated $50 billion to $90 billion in annual revenue, but third-party logistics providers have only a small share of that market. Craig Grossgart, India manager for DHL Express, said the ."^PL market in India is only about $500 million annually. In comparison, the total 3PL market in the U.S. is about $104 bilhon, according to Armstrong & Associates. A&A also puts 3PL business from global Fortune 500 companies at SI58.1 billion for 2005. India's ?>PL market is expected to grow rapidly during the next several years, Datamonitur said. Besides economic expansion and infrastructure development, reasons include lhe recent repeal of the sales tax system and the increasing sophistication and reliability of logistics and e-commerce software. ''Strong growth enablers exist in India today in the form of more than $300 billion worth of infrastructure investments, phased introduction of value-added tax. and development of organized retail and agri-processing industries," said Praveen Ojha. Datamonitor logistics analyst and author of the study. "In addition, strong foreign direct investment inflows in automotive, capital

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The Journal of Commerce • www.joc.com

March 5. 2007

India primed for 3PL boom
Contract logistics is finally catching on in a fast-growing economy goods, electronics, retail and telecoms will lead to increased...
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