The document discusses the current state of logistics in India. It notes that logistics costs in India represent 13-14% of GDP, which is higher than other countries. Several factors are impacting the logistics industry in India, including the entry of large domestic and global firms, expansion of retailers nationwide, and the growth of the third party logistics sector. However, bottlenecks in transportation infrastructure and poor logistics management are negatively impacting manufacturing competitiveness and leading to delays and high transaction costs in India. The World Bank ranks India 46th out of 155 countries in logistics performance due to issues across various indicators related to customs, infrastructure, and timeliness.

1. CURRENT SITUTION OF LOGISTICS IN INDIA
The word “logistics “is of French origin.origanally a military term, it referred to art of transport, supply
and quartering of troops .recent decades:-efficient and effective logistics management has become an
important determinants of business success.indian logistics business is growing in India and has been
growningat a cargo of 7 to 8 %.logistics cost represents 13 to 14 % of the country gdp. A world bank
conducted recently and says that in India logistic cost is more than other country. The economy is
expected to grow around 10 % over the next 10 year and sector like chemicals, petrochemicals
(especially distribution), pharmaceuticals, metals and metal processing, fmcg, textile retail and
automobile are projected to grow the fastest. New business model are emerging as new firms, both
domestic and foreign, enter the market. As a result of the ensuing competion, linkages with global
supply chains and domestic market growth promise to change the face of logistics industry beyond
recognition. The liberalizing Indian economy is experiencing entry of large domestic and global firms in
new business as well as enlargement of distribution network of many regional Indian firms. The
announcement of large retail projects by reliance and barite (in collaboration with wall-mart) will bring
new technology, add additional warehouse capacity and will require fast and reliable movement of
goods across the country. Reliance is thinking of establishing large warehouse in Thailand to take
advantage of low cost sourcing from south-east Asia once the free trade agreement with Thailand (as
well as Asian) gets finalized. Similarly, regional food and grocery retail leaders like subhiksha who are
present very extensively in the south Indian market are now entering the rest of the country with more
than 600 new retail stores in 2007.their logistics strategy and needs are transforming very significantly
with this nationwide expansion. New retail chains are entering the non-metro towns and non state
capitals.
The entry of large third party logistics (3pl) carriers like federal express and
DHL the expansion of domestic networks of Indian firms like gait and shreyas shipping is also
transforming the nature of service and the business practices across the sector.
VARIOUS ACTIVITIES RELATED TO LOGISTICS ARE AS FOLLOWS:-
Movement of raw material
Manufacturing activity

2. Primary movement of goods to distribution center
Secondary movement of goods
Business to business (b2b)
Business to consumer (b2c)distribution
Export-import (exim )activities
After sales service
Warehouse
Inventory
As we all know logistics cost in India is higher than other country. Logistics cost play an important role in
logistics management. Components of logistics costs for India is broadly classified into the categories
of:-transportation costs, inventory carrying cost (comprising of inventories, handling, warehousing, and
packaging) and other costs, which comprise primarily of administrative cost.
COUNTRY LOGISTICS COSTS AS %OF GDP
CHINA 14.5
INDIA 14.0
SINGAPORE 12.5
UNITED KINGDOME 12.2
FRANCE 11.7
JAPAN 10.5
UNITED STATES 8.7
The factors that have an impact on logistics performance can be categorized into indicators of time, cost
, complexity and risk.
INDICATOR OF TIME:-
Total time for trade – related procedure

3. Customs inspection clearance time
Technical control clearance time
Time for trade documents procedures
Inland transport time
Additional time due to container security initiative
Vessel turnaround time
Time to resolve customs appeals
Vessel waiting time to obtain berth
INDICATOR OF COST:-
Total cost for trade related procedure
Port and terminal related charges
Total costs for trade documents procedure
Borders control costs
Inland transport costs
Additional cost due to container security initiative
INDICATOR OF COMPLEXITY AND RISK FACTORS:-
Total number of documents per trade transaction
Criteria for customs inspection
Percent of container inspected
Level of customs inspection
Damage or pilferage as percentage of value of container
Shut down of port due to natural disaster and labor dispute
Speed (inland transport by trucks)kilometer per day)
Frequency of vessel calls at port
Number of agencies that have the power to inspect goods
Number of time consignment are typically inspected
Percentage of container electronically scanned
Percent of containers physically inspected
At present, India‘s manufacturing competitiveness is seriously affected by critical bottlenecks in the
transport infrastructure and by poor logistics managemnt, leading to line delays and high transaction
cost.

4. The performance of the railway is improving but it is still
not possible to have assured transportation of a consignment within a given time frame. The World
Bank’s+ international logistics performance index global ranking pegged India at the 46th
position among
the 155 countries featured. The ranking measures logistics competitiveness of a country across 6
parameters:-
Customs
Infrastructure
International shipment
Logistics competence
Tracking and training
Timeliness
The growth prospects of the logistics industry are linked to the macro-economic indicators of the
country such as GDP, domestic consumption, export and import.
Transportation i s an essential and a major sub-function of logistics that create time and place utility in
goods .in facts ,the back bone of the entire supply chain is the transportation management that makes it
possible to achieve the well known seven r :-
Right product
Right quantity
Right condition
Right place
Right time
Right customer
Right cost
Port in India handle 90 % of foreign trade in our country.
There are 14 major ports that managed by the port trust of India under central government jurisdiction
and 187 non-major ports along the 7517 km long coastline of the country.
THE 12 MAJOR PORTS:-
1. Kolkata/Haldia
2. Mumbai

5. 3. Jawaharlal Nehru port at Nava Seva
4. Chennai
5. Cochin
6. Visakhapatnam
7. Kandla
8. Mormugao
9. Paradip
10. New mangalore
11. Tuticorin
12. Ennore
Together with 259 berths handle around 73% of the all India port traffic.
Inland waterways:-
India has 15,544km of navigable waterways, including river, back water, canal, etc. 5200 km of river and
485 km of canals are suitable for such transportation.
10 major airports:-
1. Ahmadabad
2. Bangalore
3. Chennai
4. Delhi
5. Mumbai
6. Kolkata
7. Hyderabad
8. Goa
9. Cochin
10. Thrievuananthrapuram
INDIA ROAD NETWORK:-
India has one of the largest road networks in the world, aggregating 3.32 million km at present
consistency km of expressways 66754 km of national highways 470,000km of major district roads
and about 2,650,000km of other district and rural roads.
Railways:-
The Indian railways are the principal mode of transportation for bulk freight and long distance passenger
traffic. It is the world’s second largest rail network under a single management,and has been

6. contributing to the industrial and economic landscape of the country for over 150 years of the main two
segment freight and passenger of ,the freight segment accounts for roughly two –third of revenue.
CURERENT LOGISTICS SERVICES AND CHALLENGES:-
Unorganized players
Government policies
Infrastructure
Improving level of supply chain expertise