Can India handle the growth?

Filed in archive Point of view

Shifting production activities to low-cost countries such as India and China is not a new issue and the increasing growth in outsourcing has made logistics players in these countries (especially India) really happy. At the same time, there are a series of challenges coming up as the result of the growth and capacity is one of them.

Based on a report in Financial Express, the present port infrastructure is considered as woefully short of handling the rapid growth. Currently, the aggregate capacity of all ports is about 500 million tonne, whereas the existing traffic has already crossed more than 500-550 million tonne.

In future, the container traffic is expected to grow at about 18% but there are concerns of adequate infrastructure at ports. On the one side the traffic is growing at higher pace, while resources are still laggards. The industry players also acknowledge that cargo at major ports of the country is piling up.

There are concerns in the short term, and these will be gradually resolved with the initiatives from government and the private players. The Indian logistics industry is evolving and is poised to grow in terms of volumes and realization.

Seeing these challenges, a question comes to the mind that will India be able to handle the growth in short term?