Sanjiv Edward, CEO – Cargo and Logistics, GMR Group, highlights the global air cargo industry’s resilience, driven by ecommerce and sustainability efforts. Despite challenges like geopolitical tensions and slow digital adoption, air cargo continues to evolve and grow.
The role of air cargo in economic growth cannot be overstated
Encouraging growth amid challenges
The global air cargo industry is witnessing robust growth. According to the International Air Transport Association (IATA), global air cargo volumes are projected to grow by 2.6 percent year-on-year in 2024, recovering from a 1.2 percent decline in 2023. September alone recorded a 9.4 percent rise in air cargo traffic. This growth is fuelled by e-commerce resilience, increasing demand for fast-moving goods like lithium batteries and semiconductor chips, and a heightened focus on sustainability and Environmental, Social, and Governance (ESG) initiatives.
Challenges in air cargo operations
Despite these positive trends, significant challenges persist. The slow adoption of technology across airports globally hampers efficiency. Many operations still rely on paper-based processes, and the lack of standardised customs and security protocols disrupts the seamless movement of cargo. These inefficiencies are particularly problematic in a world increasingly reliant on e-commerce and quick commerce, where speed and reliability are critical.
Geopolitical tensions and trade disputes
Geopolitical conflicts and trade disputes have further complicated air cargo operations. Maritime disruptions and unpredictable service delivery have increased operational costs and timelines. To address these issues, the industry is adopting strategies such as nearshoring, diversifying manufacturing locations, and leveraging technology to simulate and mitigate disruptions. These efforts aim to improve predictability and reduce the risks associated with global uncertainties.
Dispelling misconceptions
Several misconceptions hinder the air cargo sector’s growth. Contrary to popular belief, air freight is not limited to large-scale shipments—it caters to smaller loads, including critical documents and parcels. Another misconception is that air freight customs are more complex; in reality, customs procedures are standardised regardless of the transport mode. While air freight may seem expensive, it offers unmatched speed and scalability, providing businesses with a competitive edge in a fast-paced global market.
Advancing sustainability
Environmental sustainability is a key priority for the air cargo industry. Initiatives such as paperless cargo documentation and digital customs processes are reducing the sector’s environmental impact. In India, customs procedures have transitioned to a digital, faceless model. Additionally, battery-operated cargo handling equipment and Sustainable Aviation Fuel (SAF) are being implemented to lower carbon emissions, supporting the industry’s goal of achieving net-zero emissions by 2050.
Government’s role in air cargo development
Sanjiv Edward emphasises the critical role of government initiatives in boosting air cargo’s contribution to the economy. Measures such as creating hub-specific processes, enabling faster tail-to-tail transfers with digital customs interventions, and establishing Special Economic Zones (SEZs) or Free Trade Zones (FTZs) at airports can significantly enhance logistics efficiency. Integrating infrastructure projects like Bharatmala and Sagarmala will further solidify India’s position as a global logistics powerhouse.
