The logistics supply chain in India has undergone significant transformations in recent years. The rise in demand has highlighted the need for initiatives to enhance operational efficiency. Of late, the adoption of sustainable practices has gained momentum, aligning with net zero targets. Industry players are integrating electric vehicles (EVs) for transportation and last-mile deliveries, utilising green sources of energy to power warehouses, optimising fleet routes and adopting zero-waste strategies, among other measures. The use of technology has further improved operational efficiency, thereby delivering an overall positive outcome.
Government initiatives
The government has stepped up efforts to promote sustainability in logistics by leveraging digitalisation and automation. The PM Gati Shakti National Master Plan (NMP), which facilitates multi modal connectivity, is also aligned with this objective, aiming to drive sustainable economic activity. Further, initiatives such as the National Logistics Policy, 2022 and platforms such as the Unified Logistics Interface Platform and Logistics Data Bank promote the adoption of digital technology to track and monitor logistics movements.
The government has also introduced several initiatives to promote cleaner mobility and fleet electrification. The environmental concerns associated with road freight transportation have led to the identification of more efficient modes of transportation for certain commodities. The integration of rail transportation, for example, is expected to result in lower emissions. In line with the government’s decarbonisation efforts, the Coal Logistics Plan was launched in February 2024 with the aim to modernise coal transportation. A railways based system has been proposed for first-mile connectivity projects. This initiative aims to reduce rail logistics costs by 14 per cent, reduce air pollution and cut carbon emissions by 100,000 tonnes annually.
Further, the National Rail Plan targets increasing the share of freight traffic by rail to 45 per cent by 2030. A dedicated freight corridor (DFC) will help increase this share, with expected benefits such as lower energy consumption rates.
Adoption of cleaner fleet
The transportation of commodities is a crucial component of the logistics supply chain. The success of e-commerce has increased the need for fast and efficient mobility, and direct delivery to the end customers. The surge, coupled with the sector’s significant carbon footprint, has driven the demand for more energy-efficient fleets with lower emissions. The adoption of greener fuels and EVs for goods movements aligns with the overall net zero goals while also helping reduce logistics costs. Additionally, liquefied natural gas (LNG) is being increasingly used for the commodity transportation fleet.
EVs have gained prominence in the logistics segment, with e-commerce players leading the transition. Ikea, for instance, is taking measures to increase the use of EVs for deliveries across the country, aiming for 100 per cent EVs for logistics by 2025, with their current share already at 88-90 per cent.
Several other companies have also initiated efforts to decarbonise the fleets. In June 2024, Magenta Mobility, committed to greening its logistics operations in Bhiwandi, launched Project 302. It features a new office and EV charging depot, where EVs would be operated under a hub-and-spoke model. The company has also partnered with other organisations for fleet deployment. Magenta Mobility and Kuehne + Nagel (K+N) have formed a partnership to decarbonise road freight in India by deploying sustainable electric mobility solutions and EVs. Magenta Mobility plans to deploy 10,000 EVs by September 2025 while K+N targets 60 per cent low-emission vehicles in its fleet by 2030.
Zevo India is also making headway in this space by offering sustainable transportation solutions and advanced technologies. The company aims to power 50 per cent of its facilities through solar energy. It also plans to introduce temperature-controlled refrigerated delivery EVs. Meanwhile, Bajaj Auto has signed an MoU to supply 1,000 advanced three-wheeler EVs to Flipkart over the next two years.
Green warehousing initiatives
The rapid growth of the e-commerce segment and positive initiatives promoting manufacturing have driven the demand for warehousing in the country. In response to this, existing warehouses are gearing up for expansions, and new facilities are being constructed to meet this demand. To support this growth, warehouses, known for their high energy consumption, are increasingly turning towards energy-efficient and sustainable practices in both existing and new warehouses. These efforts will not only reduce their carbon footprint, but also offer economic benefits such as reduced costs and improved efficiency.
Various green warehousing initiatives are being implemented. The majority of warehouses are using renewable energy sources, such as installing solar panels on site. Other sustainable initiatives include maximising the use of daylight, implementing energy-efficient ventilation systems, meeting relevant standards and certifications and using LED lighting. Further, measures have been taken for improving wastewater management.
For example, TVS Industrial and Logistics Parks (TVS ILP) has emphasised sustainability at its warehousing facility in Vijayawada, Andhra Pradesh, incorporating rooftop solar power, a green belt, landscaped areas and rainwater harvesting systems. Further, Robinsons Global Logistics Solutions (RGL) recently signed a deal with IndoSpace to lease a sustainable Grade-A warehouse spanning 30,000 square feet at Bavla, Gujarat.
Other initiatives
Logistics firms are devising routing strategies, and increasingly deploying optimisation software to streamline delivery processes. These tools help ensure timely deliveries while minimising delays. Further, route optimisation reduces fuel consumption.
Rising consumer demand across various industry segments has also driven an increased need for packaging. Previously dominated by single-use plastics, the packaging industry is now gradually moving towards more sustainable solutions, spurred by consumer demands for better packaging solutions. The optimisation of packaging designs not only reduces material requirements significantly, but also minimises waste. Further, companies are adopting alternative, less harmful materials.
Efforts to reduce waste across the logistics supply chain are also gaining momentum, with a focus on zero-waste logistics. Integrating circular economy practices plays a key role in achieving this target. Special emphasis is also placed on reverse logistics, involving the reuse, recycling, or refurbishment of commodities or returned products.
In sum
Increased activity in the industrial segment has driven the need for sustainable and efficient operations. Supply chain and warehousing players are leveraging this opportunity by implementing measures to decarbonise operations. There is also a demand for products with relatively greener supply chains.
Integrating these initiatives into the logistics supply chain is helping reduce carbon footprints, improve efficiency and lower overall logistics costs. Looking ahead, the continued adoption of these practices, combined with the close monitoring of emissions across operations, will pave the way for a greener, more sustainable supply chain.
