India: size of road logistics market 2025

The road logistics market in India was expected to grow at a compound annual growth rate of eight percent from financial year 2020, to reach 330 billion U.S. dollars by 2025. Such growth will be driven by factors such as the rapid expansion of the e-commerce sector and the growth of the retail sales market, among many other factors.

E-commerce in India

With the exponential growth of internet penetration rate and online infrastructure in India, along with the impact of the coronavirus pandemic, the e-commerce market has experienced a great boost. The expansion was not only limited to the online retail sector, but even more, new developments in niche markets such as food delivery services, online grocery shopping and online ticketing services were also present. The online retail market is dominated by Amazon India and Flipkart. Digitization made huge leaps, partially due to the Digital India initiative including other policies by the government.

Commercial vehicles in India

As more than half of the freight movement across India is via road, commercial vehicles are a vital pillar for India’s logistics industry. Commercial vehicles in the country are segmented by the gross vehicle weight into light commercial vehicles, and medium and heavy commercial vehicles. The former, has a gross weight of less than 7.5 metric tons dominating the market. It also reflects on the fact that within the road logistics market, the inter-city road logistics spending in India accounted for the majority of the total road logistics spending. Inter-city transport requires small and nimble vehicles, especially because Indian cities predominantly have narrow streets.