Times of Better Bharat

The improvement is real and under-reported

India climbed from 54th to 35th on the World Bank's Logistics Performance Index between 2014 and 2016, and sat at 38th in 2023 after a methodology change. Dedicated freight corridors, port turnaround times and highway construction all moved in the right direction over the same period, and the gains in international shipments were the largest.

That is a decade of genuine infrastructure delivery, and the reflex to discount it should be resisted.

Where the cost still sits

Logistics cost in India is concentrated less in line-haul than in dwell: time spent stationary at interfaces. Loading, unloading, documentation, inspection, and the handoffs between road, rail, port and warehouse.

Line-haul responds to capital — build the road, buy the truck. Dwell responds to coordination, which is harder to procure. It requires that several independent parties, often across state lines and separate regulatory jurisdictions, agree on a document standard and honour it. GST removed the checkpost, which was the single largest source of dwell; what remains is more diffuse and less amenable to one reform.

The second concentration is in the first and last mile, where fragmentation is extreme. A large share of Indian road freight is owned by operators with a handful of trucks, which makes utilisation low, empty-running common, and investment in telematics or cold chain individually irrational.

Why it compounds

Logistics cost is not merely a tax on goods; it sets the radius within which a firm can compete. A manufacturer whose delivered cost rises steeply with distance serves a regional market, not a national one, and therefore builds a plant sized for a region.

That is the mechanism by which logistics cost becomes an industrial-structure problem. Lower it and the efficient plant size rises, which raises productivity per worker, which is the variable that actually determines whether income per head converges on the countries India compares itself with.

How to read this

This is an argument, not a measurement. The charts above are sourced and checkable; the reasoning between them is editorial judgement and should be treated as such. Where a claim has no series behind it, it is stated as judgement rather than fact.