NEW DELHI – India’s logistics costs are estimated at 7.97% of gross domestic product (GDP), according to a government report released on Saturday, marking the first time the country has produced an official and comprehensive assessment of the sector.
The report, titled Assessment of Logistics Cost in India, was launched in New Delhi by Commerce and Industry Minister Piyush Goyal during events marking 10 years of the government’s “Make in India” initiative. It was prepared by the National Council of Applied Economic Research (NCAER) for the Department for Promotion of Industry and Internal Trade (DPIIT).
According to the ministry, previous figures suggesting logistics costs in India amounted to 13–14% of GDP were largely based on external studies or incomplete data, leading to inconsistencies in policy discussions. The new study is based on what the government described as a hybrid methodology, combining secondary data with nationwide surveys.
The National Logistics Policy of 2022 mandated the creation of a standard framework for calculating logistics costs and benchmarking them with international practices. Officials said the latest estimates capture costs across transport modes, product categories and firm sizes, as well as freight cost per tonne-kilometre.
Goyal said the government had launched several initiatives to make logistics more competitive and reduce the cost of doing business.
These include the creation of a logistics data bank, integrated state and city logistics plans under the SMILE programme in collaboration with the Asian Development Bank, and large-scale infrastructure projects led by the National Industrial Corridor Development Corporation.
Other reforms such as the implementation of the goods and services tax (GST), rationalisation of tax structures and the mapping of each Harmonised System of Nomenclature (HSN) code to a line ministry were also cited by the minister as measures aimed at improving coordination and efficiency.
The report noted that the growth rate of logistics costs has slowed compared with the growth of non-services output over the past five years.
The government attributed this trend to initiatives such as the PM GatiShakti National Master Plan, Dedicated Freight Corridors, Bharatmala and Sagarmala road and port programmes, Integrated Check Posts at borders, and digital platforms such as the Unified Logistics Interface Platform (ULIP) and the Logistics Efficiency Enhancement Programme (LEAP).
Officials said the study would provide evidence-based guidance to improve competitiveness and support India’s goal of becoming a global logistics hub.
