Almost all studies show that India has one of the strongest growth prospects for projected business. India improved its ranking by six spots in the latest Business Environment Rankings (BER) globally, according to the Economist Intelligence Unit (EIU) data in April 2023. The upward shift is due to its improved score in parameters like technological readiness, political environment, and foreign investment, among others.
After initial declines in 2020 and 2021, trade has provided a lifeline for economies around the world, with warehouses playing a key role in everything from vaccine distribution to e-commerce today. Let’s take a look at the role of warehouse companies in keeping the world connected below:Aiding global economies
Warehouses act as strategic buffers for storing goods and materials to provide stable access to markets during periods of geopolitical tensions and conflicts. Warehouses provide security against sudden disruptions, enabling businesses to maintain a degree of continuity and meet consumer demand. In times of uncertainty, warehouses offer the flexibility to store surplus inventory or move products to other markets, helping companies to adjust to changing circumstances and minimize the negative effects of supply chain disruption on overall economic health. Warehouses play a vital role in adapting to unforeseen challenges, helping global economies to maintain continuity and sustainability.
For example, the pandemic created an acute need for medical supplies. While in a welcome move, the CBIC expedited the customs clearance for import consignments relating to COVID-19 in India, warehousing players proactively supported the government and economy by implementing safety protocols, capacity adjustments, temperature-controlled warehouses and new technologies for employees to function in a safe environment.
Focus on India by the government and companies
The government’s ‘Make in India’ campaign and PLI schemes have led to a lot of investment in the warehousing infrastructure. The goal is to make the industry more attractive to foreign investment, create jobs, and help the economy grow by making it better. With e-commerce booming, the manufacturing sector is expanding, and infrastructure is being built, pushing the warehousing industry to be in good shape. Plus, the government’s PLI schemes are giving incentives to boost domestic production in different industries, which means more warehousing space is needed to meet the demand. Companies are investing in new warehouse facilities and tech to meet the needs of the global demand.
Challenges that need to be addressed
While the warehousing companies are working towards effective ways to address the bottlenecks in the supply chain; in-compliant warehouses, inadequate planning, and limited accessibility can lead to inefficient inventory management and delays in order fulfilment. Further to this, insufficient parking space for trucks and a lack of proper rest areas for drivers can hamper transportation efficiency and inadequate security measures pose a risk of theft and damage to goods. Additionally, a shortage of docks affects the loading and unloading of shipments, leading to hurdles in the supply chain. Addressing these issues is crucial for the logistics sector to enhance productivity, reduce costs, and ensure seamless movement of goods.
Towards the same, logistics players like us are designing parks that meet international standards to provide the necessary facilities and amenities that promote automation and streamlined operations within the warehouses. The focus on security measures and the installation of cameras ensures the safety of goods stored in the warehouses, minimizing the risk of theft and damage. Moreover, providing facility management amenities helps maintain the park’s overall functionality, ensuring a conducive environment for logistics operations. The idea should be strategically locating parks with good connectivity to multiple highways, offering a competitive advantage by facilitating easy access to transportation routes, reducing transportation time, and enhancing distribution capabilities.
In conclusion, India’s growth prospects and the government’s focus on infrastructure development through the National Logistics Policy and Gati Shakti, are creating opportunities for the logistics and warehousing sector. While challenges such as inadequate planning and security measures, need to be addressed, warehouses play a vital role in ensuring global economies’ continuity and sustainability.
Author is Managing Director at Panattoni India.