Logistic Paper Report

A RESEARCH PUBLICATION | August 2008 INDIA REPORT LOGISTICS INDUSTRY REAL ESTATE'S NEW POWER HOUSE

INDIA LOGISTICS INDUSTRY - REAL ESTATE'S NEW POWER HOUSE REPORT

A RESEARCH PUBLICATION

CONTENTS

1 Executive Summary 9 Indian Logistics Industry - A Regional Perspective 3 Introduction Logistics on a high growth trajectory 10 Location Attractiveness Analysis 6 Emerging Trends in Logistics 12 Key Locations for the Logistics Industry Sector Growth within the organised sector Kolkata, Mumbai, Hyderabad, Chennai, Emerging concept of third party logistics Nagpur, Vizag, Gurgaon, Bangalore Indore, Alwar and Kochi Rapid growth of the warehousing sector Logistics parks - One-stop shop for logistics 23 Steps to Streamline the Logistics needs Industry 23 Conclusion

EXECUTIVE SUMMARY The Indian economy has witnessed fast-paced supply and prolonged outages also meant low growth over the last decade, making it one of dependence on technology. India's archaic the preferred investment destination for warehousing system was detrimental to the multinational corporations and a recognised growth of almost all sectors, especially sectors manufacturing hub to the world. This, in turn, has like food and food-processing that requires resulted in increased demand for world-class modern warehouses and investments in cold logistics and warehousing services in India, chains and allied machinery. leading to the growth and transformation of this With increasing demand (from both MNCs and sector. The logistics sector has been growing at Indian companies) and growing requirements, the an impressive rate of 8 to 10 per cent per Indian logistics industry has expanded its annum since 2002 to touch revenues of $100 bouquet of services to now include warehouse- billion in 2007 - 081 . The World Bank's 2007 th related activities as well. Interestingly, the role of Global Logistics Report ranks India 39 amongst a warehouse too has transformed – from a 150 countries in terms of logistics performance traditional storehouse to a place where the during the year as well as its future potential. inventory is efficiently managed, with greater Further, the Indian logistics industry is expected emphasis being laid on value-added services, such to grow annually at the rate of 15 to 20 per as packaging, labelling, bar coding and reverse cent, reaching revenues of approximately logistics. US$ 385 billion by 2015. The accelerated growth of the logistics industry, coupled with an All these factors have led to the rapid growth of increasing trend to outsource warehousing the organised warehousing industry in India. activities, has made India a vast and untapped Growing at the rate of 35 to 40 per cent per market. annum, the warehousing industry is capturing the imagination of various logistics players, both For most domestic players logistics has for long domestic as well as international. Warehousing been restricted to the basic transportation of activities account for about 20 per cent of the goods. Traditionally, warehousing – which is an total Indian logistics industry2 and offer important constituent of the logistics sector – tremendous growth potential. This market has been dominated by small players with low segment is estimated to grow from US$ 20 capacities and poor deploying, handling, stacking billion in 2007-08 to about US$ 55 billion by and monitoring technologies. Erratic power 2010-113 . 1. ICICI Direct report on Transport Corporation of India 2. ET Knowledge Series 2002 3. Report on ‘Skill Gaps in Indian Logistics Industry’ by KPMG INDIA REPORT | AUGUST 2008 1 INDIA LOGISTICS INDUSTRY - REAL ESTATE'S NEW POWER HOUSE REPORT

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Over the next five years, approximately 110 projects and modernisation of over 37 logistics parks and 45 million square feet of operational airports will increase India's handling warehousing space is expected to be developed capacities, thereby enhancing logistical across the country by various logistics performances. companies. This upsurge in the logistics and This report identifies the key growth drivers for warehousing industry will in turn boost real India's logistics sector – such as increase in estate activities in key locations across the foreign trade, outsourcing of manufacturing country. activities and the emergence of organised retail – While the India logistics sector holds that are necessitating the growth of warehousing, tremendous potential, it forms a very small supply chain management, cold-storage and portion of the total global market for logistics at transportation. This study has also undertaken a Logistics cost in approximately 2 per cent of the estimated US$ SWOT analysis of various modes of freight India is fairly high 5,000 billion global logistics industry. transportation – viz. roadways, railways, ports, - at around 13% waterways and airways. of GDP, which is Despite the impressive growth rates, the much higher than logistics sector in India is fraught with many The findings of this report suggest that logistics that in USA (9%), inefficiencies. Logistics cost in India is fairly high and warehousing activities are heavily Europe(10%) and – at around 13 per cent of GDP, which is much concentrated in western India. However, the Japan (11%). higher than that in USA (9%), Europe (10 %) and report also highlights the fact that logistics Japan (11%). According to a recent report by activities are fast spreading to other parts of the FICCI-Ernst & Young (E&Y), the average time country, and more importantly to tier-2 and taken to clear import and export cargo at ports tier-3 cities. The report's location attractiveness is about 19 days in India, against three to four analysis is aimed at identifying established as well days in Singapore. As compared to the European as upcoming centres for this sector. These countries, rail transportation in India is almost centres have a direct bearing on the concomitant 3.5 times more expensive and the average real estate developments in and around such transit time by road is three times higher. These locations. inefficiencies of the Indian logistics industry can Case studies on established logistics hubs in be attributed to factors such as a complicated India, like Mumbai and Kolkata, along with similar tax regime, fragmented market structure and studies on tier-2 and tier-3 cities where logistics inadequate infrastructure. activities are gathering pace – such as Nagpur, While there are several factors that go against Indore, Vizag and Kochi – are aimed at providing India's logistics industry, however there are many a better understanding of how the sector is growth drivers that suggest its rapid transforming. transformation. While India lags behind major Today, the biggest challenge before the logistics global logistics hubs like Singapore, Germany and industry is to increase efficiencies and become Japan, factors like the changing tax regime, more cost-effective, thereby increasing India's increasing trade and the emergence of organised overall cost arbitrage. The report also examines retail will lead to accelerated growth in the steps that can help India achieve that increased sector over the next five to seven years. efficiency and ensure a more balanced and Infrastructure developments like the railway- planned growth of the logistics sector. dedicated freight corridors, road development

1. Global logistics industry report by Global Coalition for Effective Logistic

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INTRODUCTION segments such as automobile, pharmaceutical, fast moving consumer goods (FMCG) and the Logistics on a high growth trajectory emergence of organised retail. With escalating The Indian logistics sector grew by 8 to 10 per competition and cost pressures, companies are cent annually between 2002 and 2007. Several increasingly focusing on their core competencies factors have favourably impacted the growth of by outsourcing their logistics requirements to the logistics industry, like the country's changing third party logistics (3PL) players. tax regime, growth across major industry

Sustained performance by major industry segments and emergence of organized retail will lead to growth of Indian logistics industry

India will emerge as Performance of Major Industry Impact on Logistic Segments Industry one of the global 'manufactured 20 500 20 product' 16 outsourcing hubs 400 16 and reach revenues 12 300

of approximately % Growth 12 8 385 US$ 50 billion 200 % Growth by 2015. US$ Billion 4 8 100 155 2005 2006 2007 2008 E 2009 E 2010 E 100 65 GDP Pharma 0 4 Retail Consumer Durables 2002 2007 2010 2015

Source: Cushman & Wakefield Research

The future of the Indian logistics and warehousing exports and 17 per cent in imports. India's industry is currently governed by three key factors: current share in global trade is around 0.8 per cent and is expected to increase to 1.6 per cent a) Burgeoning domestic demand by 2012. Robust growth in foreign trade will Emergence of organised retail: Globally, increase the demand for good quality and timely retail has been a key growth driver for the logistics and warehouse services. logistics industry and India is no exception to India becoming a manufacturing hub: The this phenomenon. Organised retail in India has world over, India is being recognised as a been growing at over 30 per cent year-on-year. destination for outsourcing of custom-based, The total retail industry in India is expected to high-technology manufacturing activities. grow from US$ 320 billion1 in 2006 to US$ 421 According to Confederation of Indian Industries billion by 2010. (CII), India will emerge as one of the global The growth of organised retail has created 'manufactured product' outsourcing hubs and demand for specialised logistics services, wherein reach revenues of approximately US$ 50 billion every retailer relies on strong logistics and by 2015. In order to remain cost-competitive, warehousing infrastructure for the success of its contract manufacturers will be required to business. This changing business environment provide integrated logistics solutions that will should give further impetus to the logistics sector bolster the cost savings potential of the by generating increased demand for high-quality outsourcing initiative. The increasing trend of and efficient logistics and warehousing services. outsourcing will, in turn, drive strong demand for logistics solutions in the country. Increase in foreign trade: In 2007, the Indian economy witnessed a growth of 13 per cent in 1. Retail in India - Getting organized to drive growth, A T Kearney

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b) Reducing logistics costs to maintain small warehouses and depots in every state in order to avoid paying CST on The logistics cost in India – which includes inter-state sales. These multiple warehouses have inventory holding, transportation, warehousing, resulted in high inventory costs, increased packaging, losses and related administration working capital and other overheads. costs – is estimated at approximately 13 per cent of GDP and is high when compared to the A simplified tax regime will help logistics players corresponding figures for major economies. service multiple markets and offer end-to-end solutions far more efficiently and at much lower Logistics cost across major markets costs. As per the World Bank's report on the Country Logistics Cost as % of logistics activity by Logistics Performance Index, a 0.5 per cent % of GDP organized sector decrease in logistics cost leads to 2 per cent The country is USA 9% 57% growth in trade and a 40 per cent increase in the expected to Europe 10% 30-40% range of products that get exported out of the increase its Japan 11% 80% country. infrastructure India 13% Less than 6% development spend China 18% 10% From multiple taxes to a simplified tax from 4.7 per cent of Source: Accenture Study regime: Union Budget 2008-09 has proposed GDP in 2007 to 8 the phasing out of Central Sales Tax (CST ) by per cent of GDP by India's multi-layered tax regime, infrastructure 2010-11. Once implemented, this measure will 2012. This increased bottlenecks and other inefficiencies have been promote outsourcing of logistics operations and spend will help the primary reasons in keeping logistics costs encourage the creation of large warehouses at boost the logistics high in India. Under the existing tax structure, key strategic locations that could operate on the industry. 2 per cent Central Sales Tax (CST) is levied on 'hub-and-spoke' model. The implementation of inter-state sales. As a result, companies have had Value Added Tax (VAT) in 2006 has played a role in reducing logistics costs. The proposed Proposed infrastructure development across India implementation of Goods and Service Tax (GST) could lower logistics costs further. Srinagar According to the Confederation of Indian Industry (CII), improvement of logistics and Ludhiana Ambala warehousing industry can make Indian industries Chandigarh Meerut more cost-competitive, thereby enabling a GDP Delhi Jaipur growth of 11 to 12 per cent, from the existing 7 Agra Kanpur to 8 per cent. Ajmer Mughal Sarai c) Improvement in infrastructure Silchar Indore Varanasi Porbandhar Transportation in India accounts for nearly 40 Ahmedabad Nagpur Kolkata Surat Baroda per cent of the total cost of production. One of the major barriers faced by the Indian logistics Nasik industry has been the lack of quality physical Pune Hyderabad infrastructure. However, India's core sectors are witnessing a significant change. The country is expected to increase its infrastructure Bangalore Golden Quadrilateral development spend from 4.7 per cent of GDP in North-South Corridor Chennai 1 East-West Corridor 2007 to 8 per cent of GDP by 2012 . This Dedicated Freight Corridor Kochi Major Economic Zones Green Field airport project increased spend will help boost the logistics industry. However, delays in critical projects may Kanyakumari lead to a failure of this measure to provide the Source: Cushman & Wakefield Research much needed impetus to the growth of this

1. ICICI Direct report on Transport Corporation of India

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sector. Better connectivity to small towns and Preferred modes of cargo movements cities is another area planners need to work

upon. Air Road transportation is currently the most dominant form of transportation with more Water than half of the goods in the country being Rail moved by road. Almost every mode of

transportation in India is fraught with Road inefficiencies. For instance, ports – that are vital for foreign trade—have very high turnaround 0 102030405060 times when compared with statistics for other % of total cargo movement Modernisation of 37 countries. Similarly, the railways, which were a Source: Confederation of Indian Industry operational airports popular mode for freight transportation and development of (especially the movement of bulk goods), have hand, is a costly mode and its use is restricted to new airports will lost ground to road transportation due to courier shipments. It is rarely used for bulk increase air cargo limited access to smaller towns. Air, on the other transportation. handling capacity.

Various modes of transportation and their characteristics Roads Railways Water / Ports Airports

Advantages: Advantages: Advantages: Advantages: ?Road network of 3.3 ?Spread over 81,500 km, ?Cheapest mode of ?Fastest mode of million km is the second railways carries 25% of transportation transportation largest globally total freight movement ?55% of total freight ?Low transportation cost movement is via as compared to roads roadways ?Roads offer wide reach and easy accessibility to

even small markets Disadvantages: Disadvantages: Disadvantages: Disadvantages: ?High cost of ?Bulk commodities ?Poor state of inland ?Low freight movement transportation account for 90% of total waterways in the country ?87% of total freight traffic ?National Highways freight revenues ?High turnover time being handled by airports account for only 2% of ?Inflexibility to reach deep in metro cities the total network but interiors carries 40% of total freight Key Developments: Key Developments: Key Developments: Key Developments: ?National Highway ?Phase 1 of dedicated ?Cargo handling capacity ?Modernisation of 37 Development Project to freight corridor along of ports to be increased operational airports and upgrade and modernise Golden Quadrilateral to from 600 million tones in development of new highways be initiated in 2008-09 2007 to 1500 million airports will increase air ?24,000 km of National tones by 2015 cargo handling capacity Highways are to be upgraded to four/six lanes. Connectivity to ports is also being improved ?The following projects are under development. - The Golden Quadrilateral - North – South Corridor - East – West Corridor

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EMERGING TRENDS IN LOGISTICS INDUSTRY Global logistics companies – like Gazeley Broekmen (Wal-Mart's logistics partner), Growth within the organised sector CH Robinson and Kerry logistics – have also The logistics and warehousing sector in India, till forayed into the Indian market in order to now, has been highly fragmented and capitalise on the vast emerging opportunities characterised by the presence of numerous within this industry. Many of them are planning unorganised players. A large number of players to develop their own logistics parks across the have been providing services in individual country. segments like transportation, warehousing, packaging etc. In 2007, organised players Entry and expansion plans of logistics firms* accounted for only 6 per cent of the total ?DHL and India-based the Lemuir Group entered US$ 100 billion Indian logistics industry. into a 76: 24 joint venture – DHL Lemuir Logistics Private Ltd. Increase in market share of organised sector ?Germany-based Rhenus AG and Hyderabad- 2007 - Logistic Industry 2015 - Logistic Industry US$ 100 Billion US$ 385 Billion based Seaways Shipping Ltd have set up a joint venture – Seaways Rhenus Logistics Ltd.

? 88% The UAE-based Swift Freight has forayed into the Indian market. 94% ?Blue Dart Express is planning to add 1 million square feet of warehousing space to develop 58 warehouses across the country by 2010. ?The Future Group plans to develop 3 million 6% 12% square feet of warehouses by 2010.

?National Bulk Handling Corporation plans to Unorganized Sector Organized Sector set up 200 warehouses across the country by Source: Cushman & Wakefield Research 2012. *The above section captures samples of publicly reported plans of logistics firms However, changing business dynamics and the entry of global third party logistics players (3PL) Another trend witnessed over the last few years has led to the remodelling of the logistics has been the entry of several large Indian services in India. From a mere combination of corporate houses – such as the Bharti group, transportation and storage services, logistics is Tatas and Reliance Industries Limited – into the fast emerging as a strategic function that logistics sector. The Indian conglomerates involves end-to-end solutions that improve foresee huge potential for specialised logistics efficiencies. Logistics players that provided and warehousing facilities, particularly in limited logistics services, are also planning to industries like retail. Companies like Bharti, Tata broaden their areas of operation. Realty & Infrastructure, GE Equipment Services and Reliance Logistics cater to the logistics Besides expansion of distribution network by needs of their own group companies as well as both national and regional players, the sector is provide services to the other companies. also witnessing considerable M&A (merger & acquisition) activity. For instance, DHL acquired The growth of the organised sector would Blue Dart, TNT acquired Speedage Express enable the industry to provide cost-effective and Cargo Service and Fedex bought over Pafex. integrated logistics solutions in order to meet Consolidation within the industry will lead to the ever-increasing demand. As per estimates, the economies of scale for the existing organised market share of organised logistics players is players, thereby lowering costs and improving expected to double from 6 per cent in 2007 to efficiencies. approximately 12 per cent by 2015.

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Emerging concept of third party logistics Public Sector Private Foreign Companies Sector Entrants Third party logistics or 3PL is a concept where a single logistics service provider manages the Transport Corporation of India Gati DHL entire logistics function for a company. Container Corporation Allcargo Fed Ex Although still at a nascent stage, the Indian 3PL of India industry is growing at a rapid pace. Global Food Corporation sourcing activity and fierce competition amongst of India Safexpress Blue Dart manufacturers to cut costs have made Central Warehouse Reliance movement of materials rather complex, giving Corporation Logistics TNT rise to the emergence of several third party Above section reports publicly reported information logistics players. Around 3,500 acres Rapid growth of the warehousing sector of land will be Fuelled by the increasing trend of outsourcing, developed into coupled with the rapid growth in the Indian The role of a warehouse has also transformed logistics parks at an manufacturing sector, 3PL is estimated to grow from a conventional storehouse to an investment of US$ at about 30 per cent annually and become a inventory management set-up with a greater 1,000 million by US$ 30 billion industry by 2010. emphasis on value added services. Warehouses 2012. now provide additional services like Investment Details/ Plans consolidation and breaking up of cargo, Firms (2007-08) (in US $ mn) packaging, labelling, bar coding, reverse DHL 250 logistics etc. It has emerged as a critical TNT 115 growth driver, leading to large investments Gati 200 by logistics companies for the development Shreyas Shipping and Logistics 350 of warehouses and logistics parks. Warehousing Above section captures publicly reported information and related activities currently account for about The entry of large third party logistics (3PL) 20 per cent of the total logistics industry. carriers – like Federal Express (FedEx)and DHL However, it is estimated that by 2010, this – and network expansion by the existing proportion would increase to approximately 35 domestic players (such as Gati and Shreyas per cent. Shipping) have also contributed to the The traditional concept of establishing transformation of services and the business warehouses in the proximity of manufacturing practices across this sector. facilities and raw material sourcing centres is Value added services like inventory management, also undergoing a transformation. Today, there is warehousing, packaging, labelling, tracking of an increased trend of relocating warehouses shipments etc have witnessed huge demand near consumer markets. from the corporate sector. The end-users of Currently, the organised warehousing industry 3PL services include major players from the in India has a capacity of approximately retail, auto components and the electronics 80 million metric tonnes (MT) and is growing at industry. 35 to 40 per cent per annum. An investment of The organised 3PL market in India can be approximately US$ 500 million is being planned categorised into three major segments – public by various logistics companies for the sector, private sector and foreign entrants. Some development of about 45 million square feet of of the major players in each category are as warehouse space by 2012. illustrated.

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Logistics parks – One-stop shop for logistics A logistics park is a notified area that facilitates needs domestic and foreign trade by providing services like warehousing, cold storage, multi- The concept of a consolidated logistics centre modal transport facility, container freight stations can be traced back to the Foreign Trade Policy etc. This area also acts as a place where a of 2004, which led to the development of Free company can unload cargo for distribution, Trade Warehouse Zones (FTWZ). While FTWZ redistribution, packaging and repackaging. were aimed at facilitating import and export of Majority of these logistics parks will be goods, the need for a one-stop shop that could developed in the proximity of established and additionally cater to the domestic market led to emerging industrial hubs in the country in order the development of logistics parks as a part of to tap their logistics needs. the infrastructure industry in 2005-6. Majority of logistics parks are located Logistics parks versus Free Trade and Warehousing Zone SEZs around SEZ for Logistics parks Free Trade & Warehousing Zone SEZ ensuring better ?A logistics park is a special area that has warehouses, ?Free Trade & Warehousing Zones (FTWZ) are Special supply chain including a cold chain for perishables, and an area Economic Zones (SEZs) with a focus on trading and management. earmarked for automobiles and containers. These parks warehousing. They mainly cater to the international focus on the domestic markets. markets. ?Minimum area requirement for FTWZ is approximately ?No specification laid on minimum built up area. 40 hectares. ?Being part of the infrastructure industry, the incentive includes 22% tax exemption on income for continuous ?Incentives are the same as those given to SEZs operations of 10 years. ? ?Logistics parks offer tax benefits only to developers. FTWZs offer tax benefits to both developers and tenants. ?Majority of logistics parks are located around SEZ for ?FTWZ is a special category of SEZ and is governed by ensuring better supply chain management. the SEZ Act.

Planned logistics parks across India By 2012, around 110 logistics parks, spread over approximately 3,500 acres, are expected to come up across India at an estimated cost of US$ 1 billion. Majority of the upcoming logistics parks Ambala 2 Chandigarh 1 are being planned in close proximity to 4 state capitals. However, availability of Sonepat large land parcels at relatively low cost, Jaipur 1 Kanpur connectivity to multiple markets across 2 3 3 Guwahati Ahmedabad Muzaffarpur - Hajipur states and proximity to industrial 1 1 Bhopal Rachi 1 clusters has led to the emergence of 5 1 Gandhinagar 1 Indore Jamshedpur 4 Kolkata 1 some tier-2 and tier-3 cities as favoured 4 Raipur Nagpur Mumbai 8 1 Nashik destinations for the development of logistics parks and warehouses. 5 1 Vizag Hyderabad

3 3 Chennai Bangalore Note: Figure indicates number of upcoming logistic parks Kochi 2

Source: Cushman & Wakefield Research

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INDIAN LOGISTICS INDUSTRY – A the retail sector along with the fact that these REGIONAL PERSPECTIVE states have several industrial clusters of textile, pharmaceutical, engineering and automobile Industrial clusters in India can be broadly divided industries will favourably impact the logistics into four economic zones, based on the sector in this region. concentration of key industries like pharmaceuticals, auto and auto-components, Zonal attractiveness for logistics textiles, machinery and electronic goods. The Upcoming presence of these industries is likely to Warehousing space favourably impact the development of the Upcoming Logistics Park logistics industries in these locations. Existing Major states that fall in these four economic Warehouse capacity zones are: SEZs ? North: Haryana, Himachal Pradesh, Delhi Retail Development and Punjab ?West: Maharashtra Gujarat and Rajasthan 0% 20% 40% 60% 80% 100% South West North East ?South: Andhra Pradesh, Tamil Nadu and Karnataka Source: Cushman & Wakefield Research ?East: Orissa and West Bengal In western India (Maharashtra, Gujarat and Western India (Maharashtra, Gujarat and Rajasthan), approximately 30,000 acres of land Rajasthan) has emerged as the most prominent has been notified for the development of non- destination for the logistics industry. Upsurge in IT/ITeS SEZs. This should lead to increased demand for logistical services in the region. Important manufacturing hubs of India Southern India (Andhra Pradesh, Tamil Nadu and Karnataka) is a key automobile and auto ancillary manufacturing market. Several SEZs are expected to come up in this region, including multi-product, automobile and textile SEZs. The presence of a booming pharmaceutical, auto- component and agro-input industry along with the presence of seven ports facilitating international trade are likely to give fillip to the logistics sector in southern India in near future. Northern India (Haryana, Himachal Pradesh, Delhi and Punjab) is a well-established market for organised retail. Over the next two to three years, maximum supply of retail malls in the country will come up in northern India. Apart from textiles, the region also has major clusters of consumer goods and food processing industry. In addition to the Golden Quadrilateral, Automobile infrastructure development projects like the Machine Tools Delhi-Mumbai Industrial Corridor, Kundli- Textile Manesar-Palwal Expressway and the Taj Pharmaceuticals Expressway have led to the development of Minerals / Mining several warehousing hubs and inland container Source: FedEx and Cushman & Wakefield Research depots by the logistics sector.

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Eastern India (Orissa and West Bengal), an LOCATION ATTRACTIVENESS ANALYSIS exploration hub, is rich in mineral deposits and A detailed analysis study of the existing and has clusters of steel, consumer goods and textile developing logistics infrastructure, manufacturing industries. With increased emphasis being given clusters and consumer markets has brought to to stepping up trade with China, West Bengal fore key locations that would witness increased (which is also the gateway to north eastern logistics activities. These locations can be states) is strategically poised to become a major classified as established, emerging, promising logistics hub within this zone. Several logistics and nascent. parks and Free Trade Warehouse Zones are being developed in this region so that the logistics requirements of ports (for international With increased trade) and upcoming SEZs can be met. emphasis being given to stepping up Market potential / attractiveness analysis trade with China, West Bengal (which High Established hubs Nascent hubs is also the gateway to north eastern states) is strategically poised to become a major logistics hub within this zone. Mumbai

Kolkata Chennai Hyderabad

Kochi

Bangalore Gurgaon Nagpur Infrastructure Development Infrastructure Indore Ambala Vizag

Jamshedpur Ahmedabad

Alwar

Low Emerging hubs Promising hubs

High Low

Market Potential / Attractiveness

Source: Cushman & Wakefield Research

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Established hubs lower rates (as compared to the established hubs). They have also witnessed significant land These hubs offer excellent road, rail and sea transactions in last one year, involving logistics port connectivity and are also witnessing and warehousing projects. significant investments in infrastructure. High penetration of organised retail, presence of Promising hubs industrial clusters and upcoming industrial Promising hubs comprise of areas such as projects and SEZs in and around these areas Jamshedpur, Alwar, Ahmedabad, Bangalore and make these 'established' hubs all the more Ambala and have considerable prospect of being attractive. Major ports and existing logistical developed into logistics hubs. Increase in hubs – like Mumbai, Kolkata and Chennai – fall manufacturing activities is bringing about a under this category. change in these areas and opening up Mumbai has emerged as the most-favoured opportunities for the logistics players. At present, location for the development of logistics parks. these hubs have moderate presence of organised Investments of approximately US$200 million retail and an absence of multiple industries, has been planned towards the development of though this scenario has begun to change in the seven to eight logistics parks on approximately last two to three years. Infrastructure in these 600 acres of land around Mumbai. hubs is still a challenge and needs to be enhanced in order to attract logistics players. Emerging hubs These hubs are known for industries like oil and Gurgaon, Vizag, Nagpur and Indore fall under gas exploration, textile, oil and information this category since these hubs have a high technology. potential, but lack the supporting infrastructure Nascent hubs as of now. These hubs however have major infrastructure projects underway which are Nascent hubs are marked by untapped market scheduled to be completed within the next potential and limited infrastructure. The potential three to five years. Infrastructural developments of these hubs is restrained by factors such as will make these hubs develop into attractive limited penetration of retail, lack of connectivity opportunities for logistics activities. to multiple markets and the absence of multiple industries. Hubs like Kochi, an important tourist These 'emerging' logistics hubs are also destination, fall under this category. Kochi has characterised by high growth industries, immense potential for growth due to the connectivity with multiple markets and presence of an international airport and a port. availability of large land parcels at relatively

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KEY LOCATIONS FOR THE LOGISTICS Major logistics infrastructure SECTOR established/under construction in Kolkata: Kolkata ?A 108-acre logistics park is being developed near Kolkata at Unsani Mouza, which is Kolkata is amongst the oldest port cities in the located at a strategic junction between three country and accounts for about 6 per cent of national highways (NH 2, NH 6 and NH 34). the total container traffic in India. Situated on This logistics park, which is also accessible the Golden Quadrilateral, Kolkata is well to north-eastern states, provides the connected to other major cities of India by possibility of domestic and global trade road and rail. It is also the gateway to the north- with China (via Nathu La pass). east Indian markets and a key location for ? trade with China. Proximity to textile and A logistics park of around 250 acre is auto-component industry clusters and other proposed to be developed through a joint manufacturing units has made Kolkata a major venture between Tata Realty and economic centre. Infrastructure Ltd and Dubai-based Jafza International near Kolkata. Ten Special Economic Zones (SEZs) in the ?An integrated logistics park spread over 72 proximity of Kolkata have received in-principal acres is being developed at Haldia. Formal approvals. This will result in major demand approval for the development of a 113-acre for logistics in this region. As a result, centres Free Trade Warehousing Zone at Haldia has like Haldia, Falta, 24 Pargana, Dankuni, Kharagpur, also been received. Bantala and Durgapur are expected to witness substantial logistics activities in the near ?There is a proposal to develop a supply future. chain and cargo hub at Durgapur.

Kolkata city map Katwa

Raniganj Jhenida

Adra Durgapur Guskhara Navadwip Krishnagar Sonamukhi NH2 Bagula Bankura Kalna Barddhaman Ranaghat Memari 2424 Pargana Jessore Bishnupur Bangaon Pandua NH34 NH35 Barakpur Khulna Habra Dankunj Gobardanga Singur Barakpur Unsani North Daulatpur Mouza Ghatal Dum Dum Basirhat Haora KOLKATA Taki Mongla Chakulia Jhargram NH60 Bantala Rajpur Kharagpur NH6 Tamluk Falta Baruipur

NH41

NH5 Haldia Baripada Egra Jaleswar

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Mumbai Due to the growth in the logistics industry within the region, rentals are expected to Mumbai, the commercial capital of India, has for witness an upward movement. Warehouse long been an established logistical hub. Two rentals in Panvel are expected to increase by 15 major ports near Mumbai account for to 20 per cent over the next two years. approximately 60 per cent of the container trade in the country. Mumbai also has the Major logistics infrastructure established / busiest airport in India in terms of cargo traffic. under construction in Mumbai: Several manufacturing clusters, focusing on ?By 2012, eight logistics parks spread across machine tools, FMCGs, drugs and 600 acres of land are expected to come up pharmaceuticals, are present in proximity of around Mumbai at an estimated cost of Mumbai. Bhiwandi is the largest warehousing around US$ 200 million. location on the outskirts of Mumbai while Panvel is fast emerging as a warehousing cluster ?An in-principal approval has been received due to its proximity to the Jawaharlal Nehru for two Free Trade Warehouse Zones at Port Trust (JNPT) led by the availability of large Panvel that will be spread across 270 acres. land parcels. Demand for warehouse and ? logistics services are expected to accelerate Approximately 20 medium to large further due to the scarcity of quality container freight stations (CFS) are being warehouses, increase in foreign trade and the developed along the Uran-JNPT road. upcoming Maha Mumbai Special Economic Zone.

Mumbai City Map Vasai Creek

Bhiwandi

Thane Belapur Kalyan Road Ambivli Bhiwandi

Sanjay Gandhi Dombivli Ulhasnagar National Park Ambarnath

Badlapur

Thane NAVI Creek MUMBAI

MUMBAI Kalamboli

Panvel

Shedung Chinchavli JNPT Kolkhe Village Village

Dronagiri Khalapur

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Hyderabad technology park adjacent to the newly- commissioned Hyderabad International Airport Hyderabad as a logistical hub provides excellent will give further impetus to the growth of the connectivity to large markets in southern and logistics sector in this region. western India. In addition to having established clusters of textile and engineering firms, Major logistics infrastructure established / Hyderabad is also an important centre for the under construction in Hyderabad: pharmaceutical industry. A large number of ?Five logistics parks, spread across 220 acres, upcoming SEZs have necessitated the are being developed by large, organised development of logistics for the domestic private logistics players. These parks are in market as well as for global trade. various phases of development and are Jedimetla, Suraram and Sanat Nagar are existing scheduled to be completed by 2010-12. warehouse hubs while Medchal Road along ?By 2012, around 10 million square feet of NH7, Patancheru to Sangareddy along NH9, warehouse space is expected to come up in Hyatt Nagar (near Ramoji City) and the this region. A formal approval has been outskirts of Shamshabad are upcoming locations received for the development of a 300-acre for the logistics sector around Hyderabad. Free Trade Warehouse Zone near Two apparel export parks, a Free Trade Hyderabad. Warehouse Zone and several textile parks are ?The new greenfield international airport at being established in a 15 to 20 km radius of Shamshabad near Hyderabad would enhance Hyderabad. Formal approval for a 300-acre the existing cargo handling capacity of this electronic and biotech SEZ, a 1,500-acre mega region from 45,000 tonnes per annum to industrial park at Pashamylaram and the 1,00,000 tonnes per annum. proposed development of a hardware

Hyderabad city map

Pudur

Gundla- Kandi pochampally

NH9 Secunderabad

Serilungampalle Trimulgherry NH202 Bharat Ghatkesar Nagar Colony Lalbahadur Nagar

Osman Hyderabad Uppal Kalan Sagar Kapra

Moninabad Chevella Himayat NH9 Sagar Nodrigul Koheda Anajpur Malkapur Maheswaram

NH7

Palamakul Ibranhimpatan Shahabad Thimmapur Kothur Ameerpet

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Chennai Proximity to electronic and automobile component manufacturing clusters and good Chennai is the second largest port in terms of connectivity through NH 4 and NH 45 has led container cargo traffic. It's status as an emerging to the emergence of Sriperumbudur as a major passenger car export hub has increased the logistics location. Kancheepuram, Oragadam and importance of having a good logistics network in Tirvallur are the other upcoming logistics this region. Various manufacturing clusters locations in close vicinity of Chennai. focusing on textile, engineering goods and automobile components are also present in Major logistics infrastructure established / proximity to Chennai. With over 28 under construction in Chennai: international cargo flights operating per week, ?Six logistics parks spread across 240 acres Chennai is the best connected destination in are being developed in and around Chennai. southern India. ?A formal approval has been received for The prominent logistics hubs in Chennai are three Free Trade Warehouse Zones, spread Madavaram, Poonamalle and Thiruvottiyur. They over 900 acres. offer good connectivity to industrial locations, highways and sea ports.

Chennai city map

Pulicat Lake NH205 NH5 Pakala Puttur

Ponneri Nagari NH205 Kakinada

Tiruttani Tiruvallur

NH4

Chennai

Sriperumbudur Katpadi

NH46 Madras EPZ Walajapet NH4 Kanchipuram

Walajabad Kalavai Nandivaram- Guduvancheri

Arani

Uttiramerur NH45 Peranamallur

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Nagpur Major logistics infrastructure established / under construction in Nagpur: Nagpur is located strategically in the centre of India and is an ideal location for a 'hub-and- ?The Nagpur airport is being developed as spoke' distribution model in the country. A India's first international air cargo hub. major location along the North-South road ?Six logistics parks spread across 240 acres corridor of the country, Nagpur is well are in various phases of development and connected to many state capitals by road and are expected to be complete by 2012. railways. Steps such as the gradual dissolution of taxes (and more specifically the central sales ?A rail-based logistics park – spanning 60 tax) and the ongoing infrastructure development acres with facilities to handle bulk and will help Nagpur become the multimodal container cargo for domestic and foreign logistics hub of the country. trade – is scheduled to be operational by 2009. With the development of MIHAN, a multi- product SEZ, Nagpur will witness increased ?A 148 acre logistic park with road and rail industrial and commercial activity in the near connectivity is proposed to be developed future, leading to increased demand for logistics near Nagpur at an investment of US$ 50 services. million.

Nagpur city map

Kanhan Kamthi

NH7

Ring Rd Sidharth Nagar

Ring Rd Nagpur Kachimet NH6 Ram Nagar NH6 Gondakhairi Jawahar Chitnis Nagar Nagar Parsodi

Shri Nagar Ulhas Nagar

Badil Kheda

Ralpur Mihan SEZ

NH7

Parsodi

Gumgaon Jamtha

Wagdara

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Vizag (Visakhapatnam) Major logistics infrastructure established / under construction in Vizag: Located on the Golden Quadrilateral, Vizag is one of the largest ports in terms of the volume ?A 20-acre central logistics hub that would of cargo it handles. Several state-owned heavy provide end-to-end logistics solutions is industries like steel plants, oil refinery and being planned at an investment of US$ 15 fertiliser plants are present in proximity of this million at Atchutapuram near Vizag. city. The keen interest displayed by the Andhra ?There is a proposal to develop an SEZ in Pradesh government to develop the Kakinada- the Atchutapuram-Rambilli belt, about 50 Vizag belt as a Special Economic Zone would km from Vizag. This would bring in lead to higher demand for logistics services in substantial investments in logistics, since this region. A 3,500-acre industrial park is these locations will allocate space for proposed to be developed at Parawada, about logistic and warehousing development. 30 km from Vizag.

Vizag city map

Vepagunta Rushikonda Sabbavaram Chippada Meghadri Simhachalam Arilova Endada Gedda Colony Reservoir Vishalakshi NH5 Nagar Madhavadhara HB Colony MVP Colony Ganesh Nagar Railway New Colony Sheela Chinna Nagar Jagadamba Waltair Junction Parawada Port Area Kurmannapalem Auto Nagar NH5 Sri Hari Gajuwaka Puram

Peddagantyada

Steel Plant Colony Gangavaram Desa Pathrunipalem Diddapalem

Atchutapuram

Simhadri Power Plant NTPC

Nakkapalli Chipurupalle

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Gurgaon 17 upcoming SEZs in locations around Gurgaon like Sonepat, Badli and Delhi , will strengthen Gurgaon is ideally situated to cater to the Gurgaon's position as a prime logistical hub. logistics needs of the NCR and facilitate import- export traffic in the industrial areas of Haryana, Major logistics infrastructure established / north-Rajasthan and Punjab. Several auto- under construction in Gurgaon: components manufacturers, electronics and ?The proposed development of India's largest general manufacturing clusters are situated in multi-product SEZ spread across 2,500 close proximity to Sonepat, which is strategically acres between Garhi Harsuru and Badli will located on NH 1 and offers connectivity to NH add additional space for warehousing and 71, NH 24 and NH 58. The 135-km Kundli- logistics. Manesar-Palwal expressway under construction will connect major national highways and ?A 180-acre logistics park has been provide connectivity to Uttar Pradesh and developed at Patli near Gurgaon. Rajasthan. ?A 100-acre rail link logistics park with an Gurgaon has the advantage of being situated on inland container depot, container freight the Golden Quadrilateral with easy access to services and a warehouse complex is being the dedicated freight corridor giving it a clear developed at Garhi to connect the NCR advantage of developing a logistical hub. Further, with the ports in western India.

Gurgaon city map Khekra NH1 Sonipat

Bawana Sampla

NH71

NH10

Bahadurgarh

NH24

New Delhi

Dallupura Najafgarh Jhajjar Village

Noida Badli

Basai Road Pandawala Okhla

NH8

NH2 Gurgaon Udyog Garhi Harsau Vihar

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Bangalore SEZs at neighbouring Hassan district are likely to further stimulate logistics and warehousing Bangalore (Bengaluru) lies on the Golden demand in Bangalore. Existing prominent Quadrilateral and has excellent road, rail and warehouse locations in Bangalore includes airport infrastructure. Accessibility to the ports Hoskote, Whitefield, Peenya, Doddaballapur, of Chennai and Cochin has led to emergence of Hosur Road and Devanahali. Bangalore as an attractive hub for exports. In addition to the established manufacturing Major logistics infrastructure established / clusters of garments and textile, booming retail under construction in Bangalore: sector and an emerging biotechnology industry ?The development of a 7-acre cargo village at has increased the potential of logistics and the new Bangalore airport near Devanahali. warehousing sector in Bangalore. ?Four logistics parks, spread across 140 acres, Two notified Special Economic Zones (SEZ) are to be developed in various phases by 2012. catering to Biotechnology sector and upcoming

Bangalore city map

Chik NH4 Ballapur Sidlaghatta Chintamani NH48 Tumkur Srinivaspur NH206 Gubbi Dod Ballapur Devanhalli NH7

HH4 Kolar NH4 Yelahanka NH48 NH 207 Kunigal Malur Bangarapet Bangalore

NH 209

Hosur Kuppam Ramanagaram Anekal NH219 Channapatna Maddur Kelamangalam

Bargur Mandya Krishnagiri

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Indore Major logistics infrastructure established / under construction in Indore: Located in central India, Indore is connected to other parts of the country through NH 59 and ?The development of a logistics park and the NH 3. Indore is a prominent hub for automobile expansion of the existing container freight products, pharmaceuticals, textiles, food station at Pithampur have been proposed. processing and heavy engineering. Indore which Additionally, some logistics parks are being already has a planned 2,500 acres multi - developed by private players. product SEZ, is also the likely location for an ?Inland container depots are under additional 2.490 hectares of industrial cluster development at Pithampur (Indore) and proposed by the Madhya Pradesh Audyogik Malapur (Bhopal). Kendra Vikas Nigam Ltd (MPAKVN). ?There is a proposal to develop 1.6 million metric tonnes of warehouse space through public private partnership.

Indore city map

Sukliya Vijay Nagar Nanda Nagar

Kalani Cloth Indore Nagar Market

Chhatribagh Chhavni Nai Duniya Anand Nagar Sudama Betma NH59 Nagar Indra Puri Colony Dhanvantri Nagar

Bypass Road

Pithampur

NH3

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Alwar other significant developments taking place near Alwar. The development of a dedicated rail Alwar is a prominent industrial location in freight corridor and increase in trade through Rajasthan and is strategically situated near NH8 the ports of Kandla and Mundra have made and NH11. It is also well connected to the north Alwar a potential logistics hub. Indian states of Punjab, Haryana, Uttar Pradesh and Himachal Pradesh. Major logistics infrastructure established / under construction in Alwar: Alwar is also located in close proximity to Bhiwadi, a rapidly industrialising region. Other ?Alwar offers accessibility to ports through industrial and investment regions like Jaipur, rail and roadways to landlocked north Indian Dausa, Ajmer and Kishangarh make Alwar a states through Bhiwadi, an upcoming multi- potential location for warehousing and logistics modal logistics hub. development. ?The city has proximity to inland container An export promotion industrial park at Tapukra depot and container freight stations at and an upcoming SEZ at Khushkera are the Rewari and Jaipur.

Alwar city map NH58 Khekra Bhiwani Muradnagar Moradabad Hapur NH24 Bahadurgarh Hasanpur Charkhi New Delhi Jhajjar Dadri Ghaziabad Gulaothi Sambhal

Gurgaon Dadri NH71 Sikandarabad Jahangirabad Bahjoi Bulandshahr Pilani Faridabad Mahendragarh NH93 Taoru Sohna Dibai Rewari Khurja Chirawa Khushkera Palwal Jewar NH8 Narnaul Tapukra Atrauli

Tijara Khair Bahror Hodal Aligarh Soron

Sikandra Chhata Kasganj Kot Putli Rao Kaman Hathras Alwar Vrindavan Etah Nh18 Mathura Dig Jalesar Nagar Sadabad Shahpura NH2 NH93 Manoharpur Kumher Nadbai Bharatpur Agra Tundla NH18 Baswa Fatehpur Chomun NH11 Sikri Mahwa Firozabad

Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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Kochi Vallarpadom and Puthuvypeen. Several other infrastructural developments also make Kochi is one of the principal ports of India Vallarpadom and Puthuvypeen ideal locations for strategically located on one of the busiest the development of logistics parks and maritime routes. Kochi is well connected to all warehouses. major cities in southern India. It is well- connected to the hinterland by NH47, NH49 Major logistics infrastructure established / and NH17 and various rail links. The Kochi Port under construction in Kochi: Trust has initiated several projects like an ?An international container transhipment international bunkering terminal and a port- terminal (ICTT) along with a Special based SEZ that will necessitate the development Economic Zone (SEZ) with rail and road of logistics services in Kochi. link support is being developed at The Kerala State Industrial Development Vallarpadom at an investment of US$ 730 Corporation (KSIDC) has acquired million. The container terminal, along with approximately 750 acres of land for the the SEZ, would promote logistics services development of SEZs. Districts of Kannur, like warehousing, packaging services and Kozhikode and Malappuram have been short- freight forwarding. listed for SEZ development catering to the ?Tata Realty and Jafza International have textile, healthcare and rubber product industries, proposed to develop a 150-acre logistics all of which require efficient logistics support. park at an investment of approximately US$ These SEZs would benefit from the good 75 million. accessibility provided by the Kochi port. ?An inland waterway connecting Kollam and Formal approvals have been received for the Kottappuram is being developed by Inland development of 950-acre port-based SEZs in Waterways Authority of India (IWAI).

Kochi city map

Kozhikode & Malappuram NH47 Ponnani Shoranur Chittur

Pollachi

Anaimalai

Dhali

Indira Gandhi National Park

Valparai Irinjalakuda Eravikulam National Park NH17

Mathikettan Shola National Park Kalamassery Perumpavur

Alwaye

Puthuvypeen NH49

Vallarpadam Muvattupula NH49 Virapandi Cochin NH220 NH47 Kombai Existing Logistics Park/ Warehousing Upcoming Logistics Park Existing / Upcoming / Notified SEZs Source: Cushman & Wakefield Research

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STEPS TO STREAMLINE THE LOGISTICS CONCLUSION INDUSTRY Amid a booming economy and a surge in Setting up logistics parks in SEZs can demand for logistics and warehousing activities, improve India's competitiveness: Around many logistics companies are reinventing 70 to 80 non-IT/ITeS SEZs have been notified in themselves and targeting at larger roles. With the country in order to cater to various sectors. bottom-lines strengthening, the sector is These notified SEZs along with emerging attracting both public as well as private equity. economic corridors and industrial parks require This should help enhance the service offerings of efficient transportation and supply chain the sector as well as help existing players support, connectivity with various markets and diversify into new business areas. other value-added services. Therefore, in order Traditional Indian logistics players are now Over the next five to ensure that SEZs operate successfully and organising themselves in order to become more year, 3,500 acres of improve India's competitiveness, logistics parks scalable both nationally and internationally. land is scheduled to catering to an entire range of logistics be developed as Analyst attribute this change to the ongoing infrastructure should be developed in emerging logistics parks and retail boom in the country that is creating huge economic corridors and industrial parks. warehouses. business opportunities, with the added advantage Therefore, real A national logistics strategy can improve of being exposed to the latest technology in the estate decisions will efficiency and lower costs: In order to field of logistics. The entry of global firms such as play a crucial role in achieve high customer service at low cost, India UPS, TNT, NV and DHL International GmbH has developing the needs to formulate a national logistics strategy made domestic players more competitive and competitive that encourages competition and facilitates quality-conscious. strength and participation by the private players. Such a Over the next five year, 3,500 acres of land is enhancing the strategy should aim at aligning diverse state and scheduled to be developed as logistics parks and effectiveness of central government policies, set targets for the warehouses. Therefore, real estate decisions will logistics players. growth of this sector, chalk out roles for the play a crucial role in developing the competitive public and the private sector, focus on strength and enhancing the effectiveness of infrastructure development and facilitate the logistics players. entry of new players in the logistics industry. Historically, warehouses have been located in Regulating the sector to bring about close proximity to primary markets. However, uniform service standards: Today, a wide gap the abolishment of CST and an improvement in exists in the services being offered and the infrastructure would enable companies to re- pricing of various industry players. A regulatory align their supply chain and move closer to authority that specifies minimum service consumer markets. This changing business standards and benchmarks pricing can be dynamics and evolving regulatory framework has instrumental in establishing a uniform service given rise to new emerging locations. As a result, standard in India's logistics and warehousing demand for real estate will no longer be industry. restricted to only the existing primary logistics hubs in the country. Since almost one-third of Granting industry status to logistics can the total realty development in the sector is address inefficiencies: Several inherent expected to take place in emerging locations, inefficiencies can be addressed by granting an many tier-2 and tier-3 cities that offer good industry status to the logistics and warehousing connectivity to multiple markets will witness sector. This may also encourage public-private increased activity from logistics players, providing partnership and increase the government's focus a thrust to the real estate market. on this sector. Such a step will also help in the consolidation of this industry and provide it While we are witnessing rapid growth of the better access to finance. logistics and warehousing industry, a number of

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bottlenecks continue to restrain the Modern retail stores, supermarkets and development of this sector. India's transport hypermarkets can only be successful if they are network growth, for instance, is still not been backed by a robust logistics infrastructure. able to keep pace with the country's booming Similarly, India's dream of becoming a economy. While several initiatives like manufacturing hub to the world may well remain rationalisation of taxes and investment in a dream if the logistics infrastructure does not infrastructure have been undertaken, a lot keep pace with the growth in other sectors in remains to be done as far as organising and order to enhance the country's existing cost modernising this sector is concerned. Granting arbitrage. In short, the growth of several an industry status to logistics and warehousing industries and their cost-competitiveness vests sector, efficient implementation of infrastructure squarely on the growth and development of the projects, simplification of the regulatory logistics and warehousing industry. An increased structure and availability of skilled manpower focus on this sector by both the government and are critical to the growth of the Indian logistics the private players will go a long way in industry. strengthening the 'India advantage' and helping the country achieve its foretold position of a super power.

About Research & Business Analytics Group Cushman & Wakefield is the world's largest For more information on Cushman & Wakefield is committed to collation of high privately held commercial real estate services firm. Cushman & Wakefield, contact : quality base data and assembling detailed statistics for Founded in 1917, it has 221 offices in 58 countries Anurag Mathur the major India markets on a regular basis. This and more than 15,000 employees. The firm Joint Managing Director, India commitment to quality research provides a strong represents a diverse customer base ranging from Tel: +91 80 4046 5555 foundation for all of our services. Customized, small businesses to Fortune 500 companies. E-mail: [email protected] analytical reports are also developed to meet the It offers a complete range of services within four specific research needs of owners, occupiers, and Sanjay Dutt investors. primary disciplines: Transaction Services, including tenant and landlord representation in office, Joint Managing Director, India Through the delivery of timely, accurate, high quality industrial and retail real estate; Capital Markets, Tel: +91 22 6657 5555 research reports on the leading trends, markets and including property sales, investment management, E-mail: [email protected] business issues of the day, we aim to assist our clients in valuation services, investment banking, debt and making pertinent and competitive property decisions. equity financing; Client Solutions, including integrated real estate strategies for large In addition to producing regular reports such as global corporations and property owners; and Consulting rankings and local quarterly updates available on a ©2008 Cushman & Wakefield Services, including business and real estate regular basis, Cushman & Wakefield also provides All Rights Reserved consulting. customized studies to meet specific information needs of owners, occupiers and investors. A recognised leader in global real estate research, the firm publishes a broad array of proprietary For more information: Tanuja Rai Pradhan reports available on its online Knowledge Center Associate Director - India at cushmanwakefield.com/knowledge. Research & Business Analytics Group +(91 124) 469 5555 [email protected] Author of the report: Satish Tiwari Senior Associate [email protected]

Disclaimer This report has been prepared solely for information purposes. It does not purport to be a complete description of the markets or developments contained in this material. The information on which this report is based has been obtained from sources we believe to be reliable, but we have not independently verified such information and we do not guarantee that the information is accurate or complete.

Cover photograph courtesy : Schenker AG