According to FICCI, for India to achieve its goal of becoming the world’s third-largest economy by 2027, it is critical to expand production capacity, strengthen infrastructure, and enhance services both domestically and across global supply chains. The Indian logistics sector, valued at around US$380 billion in 2025, has grown steadily from US$250 billion in 2021, maintaining a robust 10–12% annual growth rate. The sector is now at a pivotal stage of transformation.
However, despite being the backbone of trade, manufacturing, and consumption, logistics in India continues to face high costs and operational inefficiencies. The World Bank’s Logistics Performance Index and Niti Aayog estimates indicate that logistics costs in India account for 13–14% of GDP, compared with 8–10% in developed economies. This gap highlights not just inefficiencies but also structural constraints that limit India’s global competitiveness.
The core challenge is not insufficient demand or infrastructure, but the way fleets are planned, deployed, and managed. As India scales its manufacturing, e-commerce, and export capabilities, the logistics sector must evolve from a volume-driven function to a technology-enabled, efficiency-focused system that can support the nation’s growth ambitions.
Why the Traditional Fleet Model Is Under Pressure
India’s freight ecosystem depends heavily on road transport. Data from the Ministry of Road Transport and Highways (MoRTH) shows that more than 70% of freight in India moves by road. While this offers flexibility, it also exposes inefficiencies that have existed for years.
According to the reports of Niti Aayog’s Logistics of India in 2022, nearly 20 to 25% of trucks return empty after deliveries. Poor route planning, long idle hours, and a lack of real-time visibility increase fuel consumption and costs. MoRTH estimates show that fuel accounts for 35 to 40% of total operating costs for fleet operators. Even small inefficiencies, when multiplied across thousands of vehicles, create major financial and environmental losses.
Commenting on this structural change, Pushpank Kaushik, CEO and Head of Business Development at Jassper Shipping, says, “A large part of the inefficiency comes from the fragmented operations. Fleets often operate in silos, and with limited coordination between demand planning, routing, and execution. It results in delays, higher fuel consumption, and weaker operational performance.”
At the same time, expectations are rising. E-commerce companies want faster deliveries, manufacturers need predictable supply chains, and global customers expect transparency on emissions and compliance. The National Logistics Policy of 2022 reflects the urgency of reducing logistics costs to around 8% of GDP in the coming years.
Why Fleet Intelligence Matters More Than Fleet Size
For a long time, success in logistics was measured by how many trucks a company owned. It is believed that the approach is no longer enough. The future of logistics depends on the efficiency of its usage, and it will not depend on its size. Research by McKinsey & Company shows that digital fleet and logistics systems can improve vehicle utilisation by 15 to 25% and reduce operating costs by up to 20%. These gains come from tools such as real-time tracking, route optimization, fuel monitoring, and predictive maintenance.
This approach is reflected in the operating models of several logistics providers, including Jassper Shipping, which provides road freight movement and chain services for businesses across multiple sectors in ecommerce like FMCG, retail and pharmaceuticals. The company manages end-to-end movement of goods, including fleet planning, route execution, and last-mile coordination. Its operating model emphasizes on fleet coordination, real-time visibility, and standardised processes, with a focus on utilisation and delivery reliability rather than only focusing on the expansion of capacity.
In simple terms, technology helps operators make better decisions. Breakdowns reduce, fuel usage becomes visible, delivery timelines improve, and teams work with clearer data instead of assumptions. Technology does not replace people; it supports drivers and operations teams by giving them better information.
Sustainability Comes from Better Operations
Sustainability in logistics is no longer an option. The transport sector is a major contributor to emissions, as reported in India’s Third Biennial Update Report to the UNFCC by the Ministry of Environment, Forest and Climate Change.
“However, sustainability does not always require responsive changes. Many improvements come from basic efficiency”, says Pushpank Kaushik, CEO and Head of Business Development at Jassper Shipping. He further adds, “At Jassper the focus has been on better routing, fewer empty trips, reduced idling, and improved maintenance to reduce fuel usage and emissions simultaneously. The International Energy Agency confirms that efficiency improvements in road freight can deliver immediate emission reductions, even before large-scale adoption of electric vehicles. In my view, sustainability works best when it is the result of better systems, not a separate initiative.”
Technology is the Foundation for Scalable Growth
As freight volumes increase with infrastructure development and digital commerce, logistics growth must rely on systems rather than manual human ecosystems. This shift is especially important for India’s MSME-driven logistics sector. According to Niti Aayog, digital integration across logistics could unlock multi-billion-dollar efficiency gains over the next decade. Affordable technology is helping smaller fleet operators improve visibility, compliance, and reliability; these are the areas that were once limited only to large companies. In many ways, technology is helping bring structure and professionalism to a traditionally fragmented sector.
Future Outlook
India’s USD 380-Billion logistics industry will not change overnight, but the direction is clear. The next phase of growth will favour companies that focus on efficient fleets, strong systems, and disciplined operations, rather than only expanding capacity. This shift increasingly includes the use of electric vehicles in urban distribution, where efficiency and emissions gains are more immediate. Companies such as Jassper Shipping have begun integrating EVs into its distribution network alongside data-driven fleet planning, which reflects how logistics is evolving into a more strategic and sustainable function.
Marex Media