PROJECT REPORT

ON

INDIAN LOGISTICS INDUSTRY

FOR PARTIAL FULFILLMENT OF
MANAGEMENT

SUBMITTED TO:
MR.Gopal krishanan
SUBMITTED BY:
Chandan kumar
Roll No. 1901B58
Mba – 3rd. sem
 Table of Contents
 Acknowledgement

 Objective of the study.

 Introduction

 Industry Scenario

 Different medium of logistics in India

 Logistics Infrastructure in India

 Key players of logistics industry in Indian

 Some Peculiarities of the Indian Supply Chains

 Recent Trends in Logistic

 SWOT Analysis for logistics industry

 Porter's Five Forces model for logistics

industry in India

 Qspm model of logistics industry in India

 EFE of logistics industry of India

 IFE OF LOGISTIC INDUSTRY OF INDIA

 CONCLUSION

 SUGGESTIONS & RECOMMODATIONS

 BIBLIOGRAPHY
ACKNOWLEDGEMENT
I provide full justice to this term paper which is prepared by visiting various
web-sites, magazines, articles etc.

I would like to take an opportunity to thank all the people in collecting the
necessary information and making of the report. I am grateful to all of them for
their time and wisdom.

My project becomes a reality only due to cooperation of many people who had
helped me in completing this project. I sincerely extend my gratitude to MR.
GOPAL KRISHNAN who has given me this precious opportunity to have a
know about the organizational Strategy.

Objective of the study.

 To know the an overview on logistics industry in India

 To know current trend of logistics and its contribution in economy

in India.

 To analyze the logistics industry of India with the help of swot

analysis, Qspm, porter five forces model, EFE and IFE.
Introduction
The logistics industry in India is evolving rapidly and it is the interplay of
infrastructure, technology and new types of service providers that will
define whether the industry is able to help its customers reduce their
logistics costs and provide effective services (which are also growing).
Changing government policies on taxation and r e g u l a t i o n of service
providers are going to play an important role in this process. Coordination
across various government agencies requires approval from multiple
ministries and is a road block for multi modal transport in India. At the firm
level, the logistics focus is moving towards reducing cycle times in order
to add value to their customers. Consequently, better tools and strategies are
being sought by firms in order to enhance their decision making. In this
paper, we provide a perspective on these issues, outline some of the key
challenges with the help of secondary information, and describe
some interesting initiatives that some firms & industries are taking to
compete through excellence in managing their logistics. The Indian
economy has been growing at an average rate of more than 8 per cent over
the last four years (Srinivas, 2006) putting enormous demands on
its productive infrastructure. Whether it is the physical infrastructure of
road, ports, water, power etc. or the digital infrastructure of broadband
networks, telecommunication etc. or the service infrastructure of l o g i s t i c s
– all are being stretched to perform beyond their capabilities. Interestingly,
this is leading to an emergence of innovative practices to allow business and
public service to operate at a higher growth rate in an environment where
the support systems are getting augmented concurrently. In this paper, we
present the status of the evolving logistics sector in India, innovations
therein through interesting business models and the challenges that it faces in
years to come.

Broadly speaking, the Indian logistics sector, as elsewhere, comprises the

entire inbound and outbound segments of the manufacturing and service
supply chains. Of late,
the logistics infrastructure has received lot of attention both from business
and industry as well as policy makers. However, the role of managing this
infrastructure (or the logistics management regim en) to effectively
compete has been slightly under-emphasized. Inadequate logistics
infrastructure has an effect of creating bottlenecks in the growth of an
economy, the logistics management regimen has the capability of
overcoming the disadvantages of the infrastructure in the short run
while providing cutting edge competitiveness in the long term. It is
here that exist several challenges as well as opportunities for the Indian
economy. There are several models that seem to be emerging based on the
critical needs of the Indian economy that can stand as viable models for
other global economies as well.

Chandra and Sastry (2004) have pointed towards two key areas that require
attention in managing the logistics chains across the Indian business sectors
– cost and reliable value add services. Logistics costs (i.e., inventory
holding, transportation, warehousing, packaging, losses and related
 administration costs) have been estimated at 13-14 per cent of Indian GDP
which is higher than the 8 per cent of USA’s and lower than the 21 per
cent of China’s GDP (Sanyal, 2006a). Service reliability of the
logistics industry in emerging markets, like India, has been referred to as
slow and requiring high engagement time of the customers, thereby,
incurring high indirect variable costs (Dobberstein et. al, 2005). However,
the Indian logistics story is one with islands of excellence though there has
been a general improvement on almost all parameters.

Industry Scenario
The recent economic changes are proof enough to establish India as an
evolving super power. The seventh-largest nation in terms of geographical area
and prominent force among emerging countries in terms of technology and
infrastructure, India is now well ahead on the growing curve of the world
economy.
 In wake of this, India is witnessing a renaissance of sorts across all
sectors, especially manufacturing, telecommunications, retail and
services, as global as well as local players converge to cater to the
world’s biggest marketplace and consumer community. As India surges
ahead on transforming itself from a ‘developing’ nation toa ‘developed’
state, one of the core sectors that is a crucial part of an upward swing is-
logistics.
 As big money gets pumped into manufacturing and other growth-centric
sectors, especially retail –the role and potential of logistics companies is
on the upswing as crucial business operations like supply chain
management and contract logistics become key issues of managing the
titanic surge in national business, both locally, nationally and globally.
  As more and more organizations think and act “global”, it is time for
third-party logistics service providers to follow suit by establishing
networks and logistics infrastructure across Asia.
 On the logistics front, India has picked up good momentum over the last
decade. With an estimated market worth Rs. 260,000 crores, the industry
contributes13 per cent to the national GDP.

 Changing logistics landscape in India

 India is already a heavyweight globally in the services sector.
Manufacturing still makes up only a relatively small proportion of GDP
—about 20 per cent compared to China's 45 per cent—but it is growing,
both in terms of domestic focus and exports. India’s container trade has
been growing at around 15 per cent over the past five years. That means
the logistics services business will be growing at a multiple of the box
trade, probably around 20 per cent and more per year. The growth in
demand presents significant opportunities for the logistics industry, as
also challenges.
 Looking ahead, India is going to play an increasingly important role in
driving world economic trade, maybe even rivaling the phenomenal
growth and transformation of China a manufacturing superpower.
 India's current trade profile provides important clues about the
development of logistics industry.

Different medium of logistics in India

There are three mediums of logistics services in India. These can be categorized
in the following way:

• Air freight – this is a modern and the safest mode to ensure a fast
delivery of goods. A chosen one by many because of the swiftness of the
system there are many companies that are now even providing super fats
deliveries by airways even on the same day.

• Land transport – this is a means of logistics support that has

withstood the test of time through the extensive network of roads in India.
It has been the popularly used method and used especially in the
shipments of heavy articles like machinery and vehicles. This is also a
chosen method in case of household packers and movers.
 • Railways – this is also an age old method of shipments and transport.
Though most used in case of domestic services this is very effective in the
availability of cost effective logistics support in India.

• Waterways – an essential part of this industry this is also one of the

oldest methods. Shipments and transportation of goods is done on an
international basis through this way. It is apt in case of shipments of oil,
highly sensitive or volatile articles like Uranium.

Logistics Infrastructure in India

Logistics involved global movement of materials, information and funds from

Country to country Requires excellent state of the art infrastructure airports, sea
ports, Internet and Other related facilities Indian infrastructure is poor as
compared to developed and developing Countries and stands at 54 amongst the
59 countries.

Road…………………56/59

Rail……………………25/59

Seaport………………..51/59

Airport………………...10/59

Key players of logistics industry in Indian

Among the key players of the Indian logistics industry there are certain
international names along with national companies that are not only world
leaders in the field but are also part of the Indian industry for a long time now.

• DHL – a very commonly known name in the Indian logistics industry,

DHL has been part of the industry for a long time now. Established in San
Francisco in the 1969 DHL has grown across 220 countries with over
300,000 employees. It has built a reputation over the years as a responsible
logistics support air, ocean, express freight and overland transport,
contract logistics solutions.

• TNT – this is an international brand that has been a part of the Indian
market also. Established at Netherlands, TNT is a reliable name in the
arena of international transportation and distribution business. Spread
across 200 countries it has an estimated revenue turnover of $ 3,500
billion US dollars.

• AFL – this is one of well known international players in the logistics

industry of India. The main areas of service by the company are in the area
of logistics and warehousing along with Courier Company and custom
consultant.

• BLUE DART – this is one of the premier companies in the field of

logistics. The company has a huge network linked with the most advanced
communication systems. Blue Dart handles large and oversized packages
and stands for an overnight delivery of such goods.

• GATI – one of the pioneering companies in the field of logistics. This

is one the companies that have taken several initiatives to implement
modernization in the area of logistics. With a turnover of Rs. 576 crores
this company believes in setting new standards of customer service.

• DTDC – this company spreads over 3700 locations within India and
240 international places. The company is a leading name in low cost
shipments along with timely delivery.

• ASHOK LEYLAND – this is an established name in the manufacture

of trailer trucks and heavy vehicles in India. It has come up with a new
venture in Ashley Transport Services Ltd. in the area of information
exchanges and the business of freight contractors along with integrated
logistics services.

• FIRST FLIGHT – this is an Indian company that has domestic,

international and many other programs of multi tracking technologies.

• AGARWAL PACKERS AND MOVERS – this is a popular name in

the field of logistics companies of India. Services like shifting, transport of
cars, and all other forms of quality packing and transportation this is a
name that has over the years become synonymous with quality and
assurance.
Some Peculiarities of the Indian Supply Chains
The Indian logistics sector has typically been driven by the objective
of reducing transportation costs that were (and often continue to be)
inordinately high due to regional concentration of manufacturing and
geographically diversified distribution activities as well as inefficiencies in
infrastructure and accompanying technology. Freight movement has slowly
been shifting from rail to road with implications on quality of transfer,
timeliness of delivery and consequently costs except for commodities
which over long distances, predominantly, move through the extensive
rail network. More on th e infrastructure issues later.

Figure 1 shows the relative value of transportation costs vis-à-vis other

elements of the logistics costs in India. The transportation industry is
fragmented and largely un- organized – a large number of independent
players with regional or national permits that carry freight, often with small
fleet size of one or two single-axle trucks. This segment carries a large
percent of the national load and almost the entire regional load. This
fragmentedsegment comprises owners and employees with inadequate
skills, perspectives or abilities to organize or manage their operations
effectively. Low cost has been traditionally achieved by employing low
 level of technology, low wages (due to lower education levels), poor
maintenance of equipment, overloading of the truck beyond capacity, and
price competition amongst a large number of service providers in the
industry. Often, one finds transportation cartels that regulate supply of
trucks and transport costs. However, the long run average cost of transport
operations across the entire supply chain may not turn out to be low.

Recent Trends in Logistic

The global logistics industry was valued at US$3.5 trillion in 2007, whereas US
logistics industry size was around US$900 billion, 25% of the global logistics
industry. Logistics costs in India are estimated to be around 13% of the GDP,
which comes to aroundUS$94 billion in 2006-07. However, India’s spending on
logistics industry is much higher than the developed economies like the US
(9.5%) and Japan (10.5%).
Air Cargo:
Air transport sector contributes over 0.2% to the country’s GDP at constant
prices (1999-2000 Prices). Transport sector’s contribution to the GDP has been
firming up over the last couple of years, mostly because of the growing
economic activities in the country. Domestic air cargo traffic has been growing
at CAGR of 12.80% from 2001-02 to 2006-07,whereas international air cargo
traffic has been moving at CAGR of 13% during the same period. During 2006-
07, total air cargo traffic is estimated to be over 1.56m tones against 1.4mtones
during 2005-06, registering a growth rate of 14.65%. According to the
Planning Commission, India’s air cargo movements would grow at over CAGR
of 11.5% from 2007-08 to 2011-12. Riding high on export of gems and
jewellery, special chemicals and high-value pharmaceuticals, international air
cargo traffic at all Indian airports have been growing rapidly.

Marine:
Marine transport sector contributes over 0.2% to the country’s GDP at constant
prices (1999 - 2000 prices). Transport sector’s contribution to the GDP has been
firming up over the last couple of years, mostly because of the growing
economic activities in the country. Shipping industry plays a significant role in
the Indian economy. India has 12 major and 187minor/intermediate ports along
its coastline of around 7,517km. The fleet strength at the end of December 2006
was 774 vessels with 8.42m Gross Registered Tonnage (GRT). Ports serve as
the gateways to the international trade in India. Major ports in India together
have handled 463.84m tones of cargo in 2006-07, a growth of 9.51% against the
same period of the previous year. The petroleum-oil-lubricants (POL)
accounted for 33.38% of the total traffic at major ports during April-March
2007, while iron ore constituted 17.37%, coal 12.98%, container traffic 15.84%,
fertilizer 3.04%, and others 17.49%. According to the Planning Commission,
India’s shipping fleet strength will be increased up to 15m GRT (as per the 3rd
target) by the end of 2011-12, with an estimated investment ofUS$17.7 billion.
The port throughput will increase up to 1,008m tones, growing at a CAGR. The
service concept, service delivery and infrastructure have to be designed very

well for the Railways Logistics Parks to add value to the supply chain.
For the Railways Logistics Park to add value to the supply chain, at least one
part of the transportation, either the incoming or outgoing, has to be by rail.
The Indian Railways would have to introduce innovative train services, so that
customers shift torail from road and use trains for either the incoming or
outgoing from the hub. Currently about80% of the products in India move by
road. One simple innovation could be to introduce time-tabled container trains,
time-tabled parceltrains etc. It is essential to have a few time-tabled freight
trains, because reliability in a supplychain is a big cost saver [reduces inventory
levels, improves customer service]

If the transportation, incoming and outgoing, is by road, then the Logistics Park
adds no value to the supply chain. It makes more sense, from a supply chain
standpoint, to have the hub on the highway, close to the city bypass, outside the
city limits, outside the octopi limits and outside any ‘No Entry’ zone. It then
makes more sense for the Railways to act as a landlord and build a Mall or
Hypermarket. A Mall or Hypermarket would give much better rentals and
higher returns on the land that the Railways own.

SWOT An alys is for logistics industry (Gateway Di strip arks)

Strength

 With the Punjab Conware CFS, Gateway has two CFS and can
handle 216,000 TEUs at JNPT, which handles more than half of the
container traffic in India. Additional CFSs at Chennai, Vizag and Kochi
would be an advantage in the long term, given the competition and
pricing pressures at JNPT.
First private sector Company to operate container trains. The Government of
India expects the volume of EXIM containers to jump First private sector
Company to operate container trains. The Government of India expects the
volume of EXIM containers to jump private sector company to operate container
trains. The Government of India expects the volume of EXIM containers to jump.

Opportunity
 Containerization as part of total general cargo in India is
currently at 60% vs. the global average of 80%. Keeping in line with
the global trend, the Planning Commission of India expects the
penetration in India to improve to 75% as the sector experiences growth
in the next

few years, underpinned/driven by cost advantages in favor of

containerization, which could benefit companies such as GDL.

 Substantial growth expected in international trade, according to

estimates from the Ministry of Trade and Commerce - India’s exports
as of FY2008 were US$155 bn. The government has targeted US$200
bn exports for FY2009. Also, a balance of trade with 40% more
imports than exports, further encourages containerization.

 Improvement in the logistics infrastructure in the country - the

industry expects the dedicated rail freight corridor, modernization of
ports, and improvement in road infrastructure to boost intra-state and
inter-state freight movement.
 Initiative by Indian Railways to allow private operators to run container
trains. ICDs coming up at Faridabad and Ludhiana could cater to the
current sizeable demand for hinterland connectivity.

 Rapid growth of organized retail Rapid growth of organized retail.

Weakness
  GDL has a concentration of business at JNPT (about 75% of
revenues), which is characterized by high competition and pricing
pressures on freight operators. A downturn at JNPT or regulatory
changes could adversely affect the company.

 Strong competition from Concor in rail container operations.

Initial revenues are expected to be mostly from low-margin domestic
traffic rather than from high-margin EXIM traffic.
 A rise in transportation costs will adversely affect margins. Also,
an increase in container traffic over and above capacity at the ports could
lead to congestion at the ports leading to a decline/ delay in the
throughput handled by the company.

Threat
 Operational efficiency is significantly lower at Indian ports
compared to global standards. Average ship turnaround time is 3.5 days
in India vs 13 hours in Hong Kong.

 High land acquisition costs for developing ICDs imply that the sector is
capital intensive.

 Strong competition from road transportation. Additionally, shipping

lines might consider setting up

 CFSs/ICDs of their own, leading to higher competition in an already

competitive business.

 Business depends on international trade to a huge extent. Hence,

companies in this sector have exposure to geopolitical risk.

Porter's Five Forces model for logistics industry in India

Porter's Five Forces model is made up by identification of 5 fundamental
competitive forces:
 • Barriers to entry
• Threat of substitutes
• Bargaining power of buyers
• Bargaining power of suppliers
• Rivalry among the existing players

When putting all these points together in a graphical representation, we get

Porter's Five Forces model which looks like this:

 Force 1: Barriers to entry: due liberalizations policy of gov. entry of

many global as well as local players are easy. Hence due to high potential
and liberalization policies of gov. Many global as well as local players
are attracted towards this sector.

 Force 2: Threat of substitutes: a large number of independent players

with regional or national permits that carry freight, often with small
fleet size of one or two single-axle trucks. This segment carries a large
percent of the national load and almost the entire regional load.
Employees with inadequate skills, perspectives or abilities to organize
or manage their operations effectively. Low cost has been traditionally
achieved by employing low level of technology, low wages (due to
lower education levels), poor maintenance of equipment, overloading of
 the truck beyond capacity, and price competition amongst a large
number of service providers in the industry.

 Force 3: Bargaining power of buyers: bargaining power of buyers is

low because of unequal development of infrastructure in country that is
infrastructure is more developed in urban area than rural areas and desert
villages. In rural areas buyers have fewer alternatives of logistics
companies.

 Force 4: Bargaining power of suppliers: bargaining power of suppliers

is low because of throatcutt competition among competitors companies.
Public sector companies such as railway and gov. transportation dep.
Provide services at low cost than private sector hence the bargaining
power of suppler is low.
 Force 5: Rivalry among the existing players: because of lage number
of existing players and new players throatcutt competition are arises in
this sector and they try to provide services at comparative prices as
possible as.

Qspm model of logistics industry in India

Quality of Indian logistics industry: The logistics cost in India – which
includes inventory holding, transportation, warehousing, packaging, losses and
related administration costs – is estimated at approximately 13 per cent of GDP
and is high when compared to the corresponding figures for major economies
India's multi-layered tax regime, infrastructure bottlenecks and other
inefficiencies have been the primary reasons in keeping logistics costs high in
India. Under the existing tax structure, 2 per cent Central Sales Tax (CST) is
levied on inter-state sales. As a result, companies have had to maintain small
warehouses and depots in every state in order to avoid paying CST on Inter-
state sales. These multiple warehouses have resulted in high inventory costs,
increased working capital and other overheads. A simplified tax regime will
help logistics players service multiple markets and offer end-to-end solutions
far more efficiently and at much lower costs.

Strategy of Indian logistics industry

 Increase in foreign trade:
 From multiple taxes to a simplified tax regime:
 Improvement in infrastructure

Planning: substantial logistics activities in the near future. Five logistics parks
are being set up in Hyderabad, spread across 220 acres and approximately 10
mn sq ft of warehouse space coming up by 2012. It scores high as a logistics
destination as 10 it provides excellent connectivity to large markets in southern
and western India and has established clusters of textile and engineering firms,
as well as an important centre for the pharmaceutical industry.

EFE of logistics industry of India

Country LPI Score

USA 3.85
UK 3.84
Singapore 4.19
India 3.07
China 3.64
Mexico 2.64
Interpretation: The Logistics Performance Index (LPI) and its indicators
provide the first in-depth cross-country assessment of the logistics gap among
countries. As the above graph shows that LPI score of USA, UK, Singapore,
India and Mexico, indicates the performance of logistics in global transport and
logistics hubs. Also as the performance of developed countries in logistics are
high as compare to the developing nation. Singapore has high performance in
global logistics as compare to other countries also gain rank 1st among all by
World Bank. USA, UK, Mexico and China are ranked in logistics performance
in global market at 9th, 14th, 56th and 30th respectively. India is ranked 39th in the
Global market show the high logistics performance than in the global market.

1. LPI top 10 countries of low income group :

Country LPI score

India 3.07
Vietnam 2.89
São Tomé and Principe 2.87
Guinea 2.71
Sudan 2.71
Mauritania 2.63
Pakistan 2.62
 Kenya 2.52
Gambia 2.52
Cambodia 2.50

Interpretation: This graph shows that India had performed well among all the
low-income countries. India has scored 3.07 LPI score and ranked 1st among all
other low income countries. This shows the among the low income countries
India’s performance in global transportation and logistics hubs is better.

IFE OF LOGISTIC INDUSTRY OF INDIA

Distribution of Logistics Costs across Some Sectors (2000-2005)

Logistics Transp Invent Warehou Order Total

Sect Cost ort ory sing, processin Logist
or Compon ation holdi packagin g & ics
ents (in g & loses administr cost
2000-01 285.0 ng171.0 185. 71. 712.6
Auto 2005-06 406.5 243.9 264. 101. 1016.4
Avg. 20. 12.2 13. 5. 50.6
2000-01 50. 30.4 32. 12. 126.5
Cement 2005-06 55. 33.3 36. 13. 138.5
Avg. 4. 2. 3. 1. 12.0
 2000-01 331.9 199.1 215. 83. 829.6
Consumer
2005-06 398.9 239.3 259. 99. 997.3
Durables
Avg. 11. 6. 7. 2. 27.9
2000-01 201.5 120.9 131. 50. 503.8
FMCG 2005-06 280.7 168.4 182. 70. 701.8
Avg. 13. 7. 8. 3. 33.0
2000-01 398.7 239.3 259. 99. 996.8
Food 2005-06 524.5 314.7 340. 131. 1311.2
Avg. 21. 12.6 13. 5. 52.4
2000-01 337.3 202.4 219. 84. 843.2
Garment 2005-06 454.4 272.6 295. 113. 1135.9
Avg. 19. 11.7 12. 4. 48.8
2000-01 174.0 104.4 113. 43. 434.9
Pharmaceut 2005-06 310.0 186.0 201. 77. 775.0
ical Avg. 22. 13.6 14. 5. 56.7
2000-01 438.3 263.0 284. 109. 1095.7
Steel 2005-06 693.6 416.1 450. 173. 1734.0
Avg. 42. 25.5 27. 10. 106.4

Economic Zonal attractiveness for logistics:

Growth of container volume in India (mn TEU)

Year Container volume (mn TEU)

2002 2.9
2003 3.4
2004 4
2005 4.5
2006 5.1
Interpretation: The above graph shows that container volume grows
continuously with the increase in the export and import in India. The maximum
growth in the container volume in the year 2004 and 2006 as compare to other
years.

Economic Zonal attractiveness for logistics:

Zone SEZ’s Retail Warehouse Logistics

Development Capacity Parks
South 40 % 20 % 20 % 30 %
West 55 % 50 % 60 % 50 %
North 5% 20 % 15 % 10 %
East 0 10 % 5% 10 %
Interpretation: The above graph shows that zonal attractiveness in India. Out
of the four zones West zone is better develop as compare to the other zones and
the least develop zone is East zone. South and North are shows the 2nd and 3rd
position for the development of the zone respectively.

CONCLUSION

Indian Logistics industry is continuously improving its performance in the

global logistics industry by improvement of customs, trade-related
infrastructure, inland transit, logistics services, information systems, and port
efficiency help to provide trade goods and services on time and at low cost.
The World Bank's 2007th Global Logistics Report ranks India 39 amongst 150
countries in terms of logistics performance during the year as well as its future
potential.
Indian Logistics industry has low performance than developed countries like
USA, UK and Singapore in global logistics sectors due inefficiency in logistics
services and highest among the low-income group countries. India spend in
Logistics activities equivalent to 13 % of its GDP is higher than that of
developed countries. The key reason is the relatively high level of inefficiency
in the system with lower average trucking speeds, higher turnaround time at
ports and high cost of administrative delays.
3PL service provider share is less in logistics sector in India as compare to
developed countries and still at the nascent stage. Multinational companies in
all industries have been predominant users of this service as one of reason for
lesser share 3PL in India. Also in India organised sector not well established as
compare to developed nation this contain cost of inventory holding,
transportation, warehousing, packaging, loss and related to administration is
higher.
In Indian logistics sector major sector investors are Aviation, Metal & Mining
and Consumer Durable. Also logistics industry in India improves the
performance of other industries year to year and share of logistics cost in sale
also important which is maximum in cement sector.
Transportation modes grow with of domestic and international market and in
India road better mode of transportation because of well infrastructure of roads
in India as compare to other mode like water, rail and sea. Road freight in India
grows with increase of domestic and international trade also large area
coverage. Railway freight also increases due low freight as compare to road but
cover some of area and better for long distance movement of goods. Sea freight
also increase better for overseas movement of goods at low cost as compare to
air but consume more time as compare to air. Air mode of transportation is also
helps in both domestic and international movement of goods but for
international movement is more as compare to the domestic due to the higher
cost, safe and faster way as compare to others modes.

SUGGESTIONS & RECOMMODATIONS

 Scheduling of service time point of arrival and departure of rails, ships
and plane has great scope for improvement. They never run on time and
require national discipline.
 Legal system is not in keeping with the modern outlook of life and
business. The laws are out mode and require comprehensive
amendments. The laws are infect remnant of British Rule and provision
contained therein do not meet the requirements of modern and complex
international trade.
 It augurs well observing development of national and selected state
highways for faster movement of traffic. It is response to free trade
regime being speedily established under the compulsive auspicious of
WTO in the interest of humanity. It is hoped that the implementation of
the gargantuan project would be on schedule or at least without much
time cost overrun.
 In this connection the UPA-1 government initiated the greatest ever
emphasis on infrastructure development, general and specific ; UPA-2
has lent first priority and invited convergence of all ministries agenda to
bear upon this infrastructure subject of international standard to facilitate
movement of foreign capital with promise of high profitability as the
country cannot movelise resources of the required dimension.
 The system and procedure obtaining in government department are
incontinent, time consuming and not at all business centric. The official
are trained as ever in manage development. There should be time to
bound programme of simplify procedure and format.
 Logistics development is absolutely necessary. In the absence of flow
less and latest logistics, the MNCs shy away from doing business in
India. There is need to increase FDI in logistics sphere and relaxing of
norms relating to entry, taxation, import of material handling and
movement of equipment etc.
 At present agriculture contribute nearly 25 % to Indian economy (GDP)
and also require development of warehouse sector. This service sector
has good prospects of equipping top place in services of diverse types.
BIBLIOGRAPHY

1. Vinod V. Sople (2007) “Logistics Management” Pearson Publication; pp

2 to 13.
2. Donald J. Bowersox & David J. Closs (2007) “Logistics Management”
Tata McGraw-Hill Publication; pp 3 to 20

3. “ Skill Gap in Indian Logistics Sector” (2007) published by CII and

KPMG
4. “Trade Logistics In Global Economy” (2007) report by World Bank.
5. “ Indian Logistics Industry” (2008) published by Cushman &
Wakefield
Websites:
1. www.google.com
2. www.scribd.com
3. www.thehindu.com
4. www.financialexpress.com
5. www.worldbank.org.com