Importance of sustainability amid exponential growth of the Indian warehousing sector and latest trends
: In an era of heightened environmental consciousness, the imperative for businesses is to adopt eco-friendly practices within their supply chains.
India’s warehousing industry is expected to reach Rs 2,872.10 billion by 2027, expanding at a CAGR of 15.64 per cent during 2022-2027. The warehousing, industrial, and logistics (WIL) sectors are projected to be crucial for attaining India’s vision of being a $ 5 trillion economy by FY25. As the sector is experiencing exponential growth, it becomes more important for the warehouse sector to focus on sustainability. This will also correspond with India's pledge to achieve net-zero emissions by 2070, as announced at the 26th Conference of Parties.
To achieve this goal, the logistics industry is actively adopting eco-friendly practices to remain competitive on the global stage. Consequently, the Indian warehousing and logistics sector is embracing sustainability through measures like recycling packaging materials, utilizing renewable energy sources like solar power and incorporating electric vehicles (EVs) for transportation.
According to Varun Gada, Director, LP Logiscience, choosing sustainability in the 21st century isn't just a matter of business strategy; it's about attracting the right partners, taking a principled stance, building stronger relationships and trust with stakeholders, and seizing the opportunity to create a profitable and sustainable business model that yields substantial benefits in the long run.
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"India's logistics sector is in direct competition with the international market, driven by the Indian government's aspiration to become an international trade hub. To achieve this goal, the logistics industry is actively adopting eco-friendly practices to remain competitive on the global stage. Consequently, the Indian warehousing and logistics sector is embracing sustainability through measures like recycling packaging materials, utilizing renewable energy sources like solar power, and incorporating electric vehicles (EVs) for transportation," Gada said.
According to Gada, LP Logiscience aims to introduce sustainable practices for energy and resource optimisation and also plans on building an EV fleet for distribution.
What are some trends?
Three significant trends are poised to shape the future of the warehousing sector in India: the ascendancy of 3PL warehousing, a growing demand for eco-friendly supply chains, and an accelerated embrace of technology.
Rise of 3PL Warehousing: The warehousing landscape is witnessing a notable surge in the prominence of Third-Party Logistics (3PL) service providers. Understanding the pivotal role of these service partners and contract logistics providers, who offer structured and tech-driven warehousing solutions, is imperative for industries and businesses. According to Gada, this trend is driven by the need for streamlined logistics operations and optimized supply chains.
Rise of Green Supply Chain: In an era of heightened environmental consciousness, the imperative for businesses is to adopt eco-friendly practices within their supply chains. This is not just a matter of environmental responsibility but also a strategic move to gain international recognition, acceptance, and credibility. Embracing greener solutions, such as sustainable packaging and energy-efficient transportation, is essential for building sustainable and profitable business operations in the long term.
Tech-Infused Warehousing: Forward-thinking warehousing operators are increasingly integrating technology into their warehouse management processes. This integration enhances the quality of service for customers and boosts operational efficiencies. By leveraging technologies like warehouse management software, the sector is poised to deliver superior results in a highly competitive environment.
Furthermore, these trends align harmoniously with the government's concerted efforts to bolster transport infrastructure, a crucial enabler for the warehousing sector. The National Logistics Policy (NLP) also plays a pivotal role in propelling warehousing growth, particularly in secondary or tier 2 markets.
In essence, the future of warehousing in India will be characterized by an intricate interplay of technology, sustainability, and logistics partnerships, all poised to drive this sector to new heights.