Shangliao Sun
Research expert covering India
Freight transportation in India - statistics & facts
Freight transport is the circulatory system of the modern world. It has always been important to commerce and our society. Regardless of the mode of transport, be it road, rail, water, or air, they all play a vital role in the economy. While freight transportation is driven by the demands generated by the manufacturing industries and consumption, it also creates demand for commercial vehicles, cargo airplanes, freight trains, and other means of transportation including drones. With one of the largest GDPs in the world, India has a substantial logistics sector, that employs millions of people. Furthermore, the vast infrastructure network of roads, ports, railways, and airports also stimulates the construction industry of the country.
Geographical conditions and main methods of transportation
Situated in South Asia, with the Himalayas in the North, and the Indian ocean in the south, India has more than 7.5 thousand kilometers of mainland coastal line and almost 3.3 million square kilometers of landmass. India predominantly relies on sea and air transport for its international trade. Meanwhile, as the most populous country, many metropolitans and states are inland. Freight transport in these regions depends on road and railway. India has the world’s third largest road network and the fourth largest railway sector. The latter is operated by public enterprises.Logistic hubs in India
India has had comparatively high logistics costs at nine percent of the GDP in comparison with other BRICS countries which stood at 11 percent. The high cost of logistics is partially due to the inefficient modal mixture. In order to boost competitiveness in this sector, the Indian government proposed the construction of 35 multi-modal logistics parks (MMLP). These MMLPs are freight handling facilities with a minimum area of 100 acres. This includes access to various modes of transportation, mechanized warehouses, specialized storage facilities, and other related facilities and terminals. Third-party logistics and retail constituted the largest share of warehousing transactions in India.Investments
In recent years, the government has invested heavily in modernization and expansion of the railway system. Several dedicated freight corridors are under construction or in the planning stages. Despite an adequate road, as measured by the ratio of the total road network to the land area in the county, India’s quality of road infrastructure remains subpar in comparison to other countries. However, government funding and private investment have been increasingly flowing into road infrastructure. And the national highways have seen accelerated expansion lately.
