India’s logistics costs dropped to 7.97% of GDP in 2023-24, driven by PM Gati Shakti and improved rail infrastructure.
According to a report commissioned by the Department for Promotion of Industry and Internal Trade and prepared by the National Council of Applied Economic Research, India’s logistics expenditure was calculated at 7.97 per cent of the national gross domestic product for the 2023-24 financial year. The study, which was released in late September 2025, indicates that the growth rate of these costs is experiencing a steady decline.
The reduction in expenses is linked to several strategic government programmes, including the PM Gati Shakti National Master Plan, the development of dedicated freight corridors, the Sagarmala project, and the implementation of the Unified Logistics Interface Platform. This official data provides a more accurate reflection of the sector than previous external estimates, which frequently cited much higher figures between 13 per cent and 14 per cent.
The findings offer a detailed breakdown of transport efficiency across various sectors and cargo types. Rail transport has been identified as a highly economical option, costing an average of ₹1.96 per tonne-kilometre when excluding first and last-mile transfers. In contrast, road haulage is significantly more expensive at ₹11.03 per tonne-kilometre. Air freight remains the costliest method at ₹72 per tonne-kilometre, primarily reserved for urgent or high-value shipments.
On a global scale, India’s logistics performance now aligns closely with South Korea, where costs are approximately 8 per cent. This sits in contrast to other major economies such as China, which reported costs at 14.4 per cent in 2023, and Indonesia, where figures reached 24 per cent. The new framework established by this report aims to provide policymakers and international investors with a reliable, scientific benchmark for evaluating India’s supply chain efficiency.
SOURCE – BUSINESS STANDARD
