The devastating second wave of the COVID-19 caused a massive crisis in the country, especially for warehousing and logistics industry. With a shortage of oxygen, medicines, and ventilators, India had no choice but to import such supplies from other countries to save the life of thousands of people fighting the virus. And this was made possible through efficient logistics.
May it be the domestic or international supply chain of essential medicines and products, it was the warehousing and logistics sector that majorly contributed to saving thousands of lives during this massive second COVID-19 wave in the country.
Both these industries not only saved lives but also saved themselves after the first COVID-19 wave across the globe. As per international reports, the warehousing and logistics sectors are among the fastest to recover from the coronavirus crisis.
The report further suggests that shortly, the Indian warehousing and logistics sector may witness significant growth with the possibility of global firms shifting manufacturing to India to de-risk supply chains as reasons.
The Welspun One Logistics Part (WOLP) report from May 2020 indicates that the Indian logistics and warehousing sector will be witnessing a whopping 35% growth by the end of 2021. This report came after an earlier report that predicted a 25% growth of both sectors in India. However, the aftermath of the coronavirus pandemic changed many things, especially the fate of several industries.
With supportive government policies and flexible regulations, it is being anticipated that India might become one of the top global manufacturing pivots. Reports further suggest that the Logistics and warehousing industry has always been a pillar of the Indian economy. Even after the economy was badly hit during the COVID-19 outbreak, it was the logistics and warehousing industry that helped the country’s economy revive.
Here are the key factors that will drive the estimated growth of the Indian warehousing and logistics sector:
Ecommerce growth: The coronavirus pandemic has changed many things. It has changed the dynamics of several industries, including eCommerce. People now prefer online shopping rather than outdoor shopping as they have realized how easy it can be to just place an order and have it delivered to your doorstep. This has made more and more people place an order online for anything—from clothes to fruits, resulting in a massive growth of the eCommerce sector in India.
Increased investment in warehousing real estate: Both commercial and residential real-estate might have suffered during the economic slowdown in the country, but warehousing real estate has surely witnessed growth with several investors looking to invest in it. The key factors driving the Investment in Warehousing real estate are 100% FDI, better returns on industrial and warehousing real estate, digital adaptation, and innovative warehousing with specialized storage facilities.
Boost in local and global manufacturing: The Atmanirbhar Bharat (self-reliant India) mission announced by PM Narendra Modi aims at strengthening local manufacturing and production in India. The vocal for local initiative has opened a wide opportunity for local manufacturers, leading to a boost in manufacturing. India is now aiming at becoming the manufacturing hub not only for local businesses but also for global businesses.
This progress will further boost the logistics and warehousing sector including transitional growth in sectors like automobiles, which are already relying on specialized warehousing for kitting and final assembly of parts etc., are paving the way for the warehousing and supply chain sector to evolve into a major support infrastructure for manufacturing.
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