India’s logistics industry is the backbone of its trade and commerce. But while the economy races forward—toward digital payments, real-time commerce, and AI-driven insights—the logistics sector still often runs on paper, phone calls, and spreadsheets. Despite being valued at over USD 250 billion, India’s logistics industry lags behind global standards when it comes to technology adoption.
This tech gap has led to inefficiencies, delays, high logistics costs (about 14% of GDP, compared to 8–10% in developed nations), and reduced global competitiveness. This write-up explores how Indian logistics fell behind on tech and outlines a practical roadmap to fix it.
Part I: How We Fell Behind
1. An Industry Built on Fragmentation
India’s logistics landscape is extremely fragmented, made up of thousands of small and medium-sized businesses. These are often family-run operations focused on daily operations and firefighting, rather than long-term digital transformation.
Over 90% of logistics players are SMEs with limited resources.
They operate independently, with little interoperability or data exchange between stakeholders—making it difficult to scale or standardize.
Tech often takes a back seat to immediate operational concerns.
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2. A Deep-Rooted Legacy Mindset
Many logistics companies still operate using manual documentation, physical ledgers, and basic Excel files. The industry is often led by traditionalists who equate technology with high costs and job loss.
There is a perception that software is for “big players” only.
Leaders are wary of change, fearing disruption to operations or resistance from staff.
As a result, digitization efforts are delayed or discarded altogether.
3. Low Awareness of Tech Possibilities
There’s a widespread lack of awareness around how technology can directly improve logistics efficiency and profitability.
Decision-makers often don’t fully understand tools like Transport Management Systems (TMS), Freight ERP platforms, or digital customs clearance solutions.
In many cases, tech adoption is reactive (due to regulation or client demand) rather than proactive.
4. Infrastructure and Ecosystem Challenges
While India has made strides in mobile and internet penetration, logistics operations still face digital hurdles.
Remote areas often suffer from poor connectivity, which restricts cloud-based operations.
Real-time tracking remains difficult in less urbanized areas.
Hardware adoption (scanners, IoT sensors, GPS) is still limited.
5. Delayed and Uneven Government Digitization
The Indian government has introduced several smart initiatives—like ICEGATE (customs), e-Way Bills, FASTag, and ULIP—but their adoption across the industry has been inconsistent.
Many SMEs aren’t equipped to integrate with these platforms.
There’s often a lack of alignment between public digital systems and private logistics workflows.
Government digitization is progressing, but its impact remains fragmented due to lack of seamless integration and industry readiness.
Part II: What Needs Fixing
Fixing the tech backlog in Indian logistics will require a combination of mindset shifts, policy incentives, platform adoption, and education. Here’s how we can move forward:
1. Shift to Unified, Cloud-Based Platforms
At the heart of the problem lies the disconnected nature of logistics operations—bookings, documentation, billing, tracking, compliance all run on separate systems (if any).
The fix: Adopt unified ERP platforms like Logi-Sys that consolidate operations across branches, modes, and partners.
- Centralized operations, finance, Sales & CRM and customer visibility on one system
- Cloud-based access—ideal for distributed teams
- Automates documentation, invoicing, freight tracking, and compliance
This transition reduces manual workload, ensures data accuracy, and allows logistics companies to scale.
2. Empower the Workforce Through Digital Training
Technology is only as effective as the people using it. A key barrier to adoption is a digitally unskilled workforce. Drivers, brokers, and operations teams are often unfamiliar with using even basic apps.
What’s needed:
- Skilling programs focused on logistics tech (like Softlink Academy’s LogiEXPERT and LogiSKILL courses, or NSDC-backed initiatives)
- Upskilling operational teams in TMS, digital freight handling, documentation tools
- Creating a new generation of tech-savvy logistics professionals
This builds long-term readiness and reduces resistance to change.
3. Encourage Industry-Wide Tech Standardization
There’s a pressing need for logistics players to speak the same digital language.
- Mandate digital documentation, API-ready platforms, and EDI (Electronic Data Interchange) compatibility for customs and port processes.
- Adopt tech standards across freight forwarding, transportation, and 3PL operations.
- Encourage data sharing protocols between ports, CFSs, airlines, and customs brokers.
The goal should be to create a seamless digital flow across the logistics ecosystem—not isolated digital islands.
4. Strengthen Public-Private Tech Collaboration
Digital transformation at scale cannot happen without better coordination between government platforms and private players.
- Government initiatives like ULIP (Unified Logistics Interface Platform) must integrate with ERP platforms used by LSPs.
- Startups and logistics tech providers must be part of the policymaking process.
- Infrastructure incentives, digital adoption grants, or tax rebates should be considered for MSMEs investing in automation.
A collaborative model helps avoid duplication of efforts and accelerates industry-wide adoption.
5. Build for Scalability from Day One
Indian logistics companies should stop thinking in terms of “what works now” and instead adopt solutions that scale with them.
- Choose modular platforms that adapt to air, sea, road, and rail logistics as the company grows.
- Build centralized data repositories that support analytics, forecasting, and decision-making.
- Invest in automation—not as a luxury, but as a competitive differentiator.
Conclusion: A Digital Future Is Inevitable
The Indian logistics industry cannot afford to treat technology as an afterthought any longer. As global supply chains grow faster, smarter, and more interconnected, India must build a future-ready logistics backbone.
What’s encouraging is that the solutions already exist. The challenge now is in creating awareness, aligning incentives, building skills, and driving adoption across every link in the supply chain—from the port to the last mile.
The future belongs to those who digitalize, centralize, and optimize. For Indian logistics, the journey has already begun—but catching up requires urgency, vision, and execution.