India's logistics cost will be below 9% of GDP by April next year: Gadkari

New Delhi: India's logistics cost is expected to decline to 9 percent of GDP by April next year, according to Union Minister Nitin Gadkari, who made the announcement on Thursday. Speaking at an event, Gadkari emphasized that this reduction in logistics costs will also lead to a significant increase in the country's exports as costs approach single-digit levels.

Currently, India's logistics costs stand at 16 percent of GDP, but the minister is confident that this figure will drop dramatically within the next year. This reduction aligns with broader economic goals to enhance the efficiency of India’s logistics sector, which has been a significant barrier to global competitiveness.

Gadkari's projections contrast with estimates from the National Council of Applied Economic Research (NCAER), which had previously assessed logistics costs in India to range between 7.8 percent and 8.9 percent of GDP during 2021-22. Regardless, the push towards reducing logistics costs remains a key priority for the government.

During his address, the Road Transport and Highways Minister also highlighted the need for the Indian economy to generate more employment opportunities. He pointed out that previous governments did not sufficiently prioritize the rural sector, a gap that the current administration under Prime Minister Narendra Modi is working to address by focusing more on agriculture.

Gadkari stressed the importance of boosting agricultural growth and increasing per capita income in rural areas as part of the government's broader strategy. He also noted that India, currently the fifth-largest economy globally, is on track to become the third-largest economy, owing to its rapid growth.