Logistics industry performance in 2021 and outlook for 2022

Logistics, being an integral part of the essential service network has yet again proven its capability to adapt and deliver. The pandemic has paved the way for innovation in logistics and one such case in point is of how a mission-critical logistics driver’s fitness can constantly be monitored through Fatigue Meter readings. As a result of which, he can be signaled to stop and rest, as and when required. Ensuring that speed of the vehicle remains as per norms and GPS tracking at control tower are amongst other technological advancements that not just maximize visibility but save lives!

In a constant endeavour to rethink and redesign supply chain solutions, the industry has been moving in the right direction to meet rising demand post the economic slowdown caused due to second wave. From exploring and adopting new technologies to shifting regulations to ensure complying with BRSR, ESG, GHG norms – there has been a highly competitive environment.

Logistics players like ourselves who have embraced a combination of latest trends and established business strengths have seen an uptick. There has been an exponential growth in last mile deliveries and the industry has gone through an end-to end transformation in handling its operations. Adoption of WMS (warehouse management system), on-demand warehouses/ fulfilment centers, end-to-end customised solutions, push towards multimodal especially rail and coastal, big data analytics, self-driving carrier trucks, use of automated vehicles, drones and EV have been certain important talk points/trends of
the industry.

With the launch of significant government initiatives like ‘Gati Shakti’ Master Plan for multimodal connectivity, a smooth logistics infrastructure development is being looked forward to in the coming years. With a monetization and execution plan in-place, this surely is the right move towards creation of an ‘Atmanirbhar Bharat’. It will give a big fill-up to supply chains, help in cutting down needless logistics cost and reduce turnaround time in 2022 and beyond. It will also act as an important step towards improving global competitiveness and promoting local manufacturers. Proposed Warehousing Policy
and to-be released National Logistics Policy will also prove to be instrumental in bringing ease of doing business. Recent examples of tech-based government initiatives include the launch of SDLE (Secured Document Logistics Exchange) and GHG calculator to enhance logistics efficiency.

Other initiatives aimed at driving innovation in the industry include Radio-frequency identification (RFID) tags, and process automation applications such as ‘Vahan’ and ‘Sarathi’.

With the ever increasing demand for logistics, it is important to stand up to the global call for sustainability. The government, in association with TERI (The Energy and Resources Institute), introduced the Sustainable Urban Freight Coalition (SUFC) to facilitate sustainable urban freight solutions. It aims at helping the nation achieve the vision of decarbonized transport and logistics sector by 2030. It also states that India is the world’s third-largest emitter of GHG emissions emitting about 2625.968 Mt CO2e in 2019 which are responsible for Climate Change. Out of which, the logistics sector is responsible for 13.5% of energy-related CO2 emissions. Thus, switching fossil with renewables and alternate energy fuels is an
unavoidable need of the present and future. TCI, through its multimodal capabilities continues to make efforts to reduce overall carbon footprint in the ongoing as well as years to come. We enabled to save 21,994 Tonnes of CO2 equivalent in terms of GHG emissions in the year 2020-21.

There have also been certain challenges that the industry is facing – high international freight rates, shortage of containers, high prices of ships, driver shortages, fuel price increase and inflation in general.

Operating costs will continue to increase and international freight rates may stabilize only around June 2022. In the year ahead, the way forward is to capitalize on new opportunities including multimodal, leveraging future technology to reduce margins and previous technology investments to incubate big data, IoT, and omnichannel solutions. Thus, the above shift continues to make the industry much more
resilient in adapting to any challenge that comes forth.

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