Analysis of Indian Logistics SectorSector

Manoj Bharadwaj. BFortress Financial Services Ltd.

Mumbai

Overview of the Logistics Sector

Structure of the Logistics Sector

Major Demand and Growth Drivers of Indian Logistics

Comparison of Indian Logistics Sector

Flow of the Presentation

Comparison of Indian Logistics Sector with different countries

SWOT Analysis

Challenges and Opportunities

3PL and 4PL

Definition of Logistics:• The process of planning, implementing, and controlling the efficient, cost effective flow and storage of raw

materials, in-process inventory, finished goods and related information from point of origin to point of consumption for the purpose of meeting customer requirements

Organized10%

Unorganized Player:• Owner with less than or equal to 5 trucks.• They contribute about 80% of the 1 to 10 crore

10 to 100 crore

2%more than 100 crore

0.3%

Total Market Size of Logistics is estimated to be $ 95 billion

Level of Competitiveness

Overview of the Logistics Sector:

Market Structure

Unorganized90%

• They contribute about 80% of the revenue.

0.3 to 1 crore89%

1 to 10 crore9%

Penetrating this huge volume of Unorganized

Players is by far the biggest challenge

Level of competition is extremely intense,

undercutting beyond a point may not be feasible. Hence

LSP’s have to go beyond rendering just the basic

services.

LSP: Logistic Service Provider

Share amongst different segments of Logistics sector:

Railways24%

Major Ports15%

Minor Ports6%

Roads55%

Cargo Share amongst different Segments

Share in Revenue Generation amongst different Segments

Railways13%

Roadways47%

Ports2%

Warehousing

37%

Civil Aviation

1%

Civil Aviation (Negligible) Segments

Annual Turnover in 2008-09 (INR

billion)

Railways 534

Roadways 2086

Ports 91

Warehousing 1,500

Civil Aviation 436% 2%

v Nearly 70% of domestic freight is carried by the Road segment and the remaining by Rail segment while the

contribution of the remaining two segments is comparatively negligible.

v International freight is completely dominated by Sea Port Segment.

Where do we stand Globally ..

•Indian Railways is 2nd largest in the world just marginally behind China

•Indian Roadways is also the 2nd largest behind U.S which has 6.4 million km of network.

•India has the largest merchant shipping fleet among the developing countries and is ranked 17th globally.

•Constitutes just 3% of global air cargo.

Structure of Logistics Sector

Logistics Segment Growth DriversProjected

Growth RateBarriers to

entry Dominance of PlayersCapex

Requirement Nature of Competition

Courier Domestic growth 20-25% Low Unorganized Low Local

XPS FMCG, Retail, Auto & Auto Ancillaries 20-25% High Organized High National

WarehousingAgriculture commodities,

Manufacturing activity 40% Medium Unorganized High Regional to National

TruckingAgriculture commodities,

Manufacturing activity 12% Low Unorganized Low Local

Container EXIM and domestic trade 15-20% Medium Organized High National

Inland Container Depots / Container Freight

Stations EXIM 15-20% LowOrganized /Unorganized High Local

Characteristics of Logistics Sector

vHigh costs of operations

vLow margins

vShortage of talent

vInfrastructural bottlenecks

vDemand from clients for investing in technology and providing one-stop solutions to all their needs.

vConsolidation through acquisitions, mergers and alliances.

Value Driver:

Ø Competitive Pricing

Ø Safety

Ø Customer Satisfaction

Ø Wide Geographic Reach

Ø Operational Efficiency

Ø Time Factor

Ø Value added services

Transportation35%

Inventory Handling and Warehousing

34%

Packaging11%

Losses14%

Customer Shopping

6%

Major Cost Elements

Loses of 14% translates into roughly INR 290 billion for various industries primarily

due to the Unorganized section

34%

Certainly a huge opportunity for Organized players to cash in by

providing the requisite safety and the insurance coverage for the truck

load of goods.

Major Demand and Growth Drivers of Indian Logistics:

Logistics

Manufacturing Industry InfrastructureGovernment Policies, Plans and Taxation

Roads

Railways

Auto TextilesImplementation

of GST

Agricultural industry

Enhances the market reach of

the industry

Accounts for

Growth Driver Growth DriverDemand Driver

Railways

Warehouses

Ports

Civil Aviation

Cement

FMCG

Food & Beverages

Steel

FMCG, Pharma and Food processing apart from agro products have

substantial requirement

Accounts for about 50% of the

total logistics market

Favorable policies drives the growth of

logistics sector

11th Five Year Plan (2007-12) (Roads, Railways, Ports and Civil Aviation)

(INR billion)

Railways Roadways Shipping & Ports Civil Aviation

4,457

2,510

Slightly over 3 timesjump from 10th 5YP

8% of India’s GDP in 2009

56.3%24.08% 9.84%

9.77%

Government Plans

1,073 438 435606 621 54 129

10th 10th 10th 10th

> 4 times 1.72 times 8 times 3.4 times

PrivateInvestments

GBS37%

IEBR18%

Private Investmen

ts45%

Roadways - 1,941 INR billion

GBS5%

IEBR49%

Private Investme

nts46%

Shipping & Ports – 807 INR billionGBS1%

IEBR31%

Private Investments

68%

Civil Aviation - 1,370 INR billion

GBS34%

IEBR66%

Railways - 2,510 INR billion

Gross Budgetary Support (GBS)Internal and Extra Budgetary Resource (IEBR)

867 368 934

Rationalization of tax:

Goods and Services Tax (GST) – Proposed to be implemented by April 2010.

•Aims to remove multiple taxation by abolishing taxes such as Octroi, Central sales tax, State level sales tax, entry tax, stamp duty, telecom licence fees, turnover tax, tax on consumption or sale of electricity, taxes on transportation of goods and services

•Hopes to increase the tax base

•Aims to remove the disparity in taxation or

Impact

•The introduction of GST in India would mean that manufactures will now base their logistics decisions on operational efficiency instead of tax optimization.

•Will enable manufacturers and 3PLs to set-up and position their warehouses and distribution channels based on the considerations of time, cost and logic.

Government Policies and Taxation

Other Tax ReliefsvThe 100 % deduction allowed in respect of capital expenditure for the business of setting up and operating cold chain facilities for specified products, and setting up and operating warehousing facilities for storage of agricultural produce.

vThe enhancement of limit for disallowance of expenditure made in the case of transporters i.e. to raise the limit from Rs 20,000 to Rs 35,000 effective October 1, 2009 and NIL TDS for road transport, would certainly address the stringent practicaldifficulties, which is step towards moving of this Industry from unorganised to organised structure.

vDeductions under section 80-IA meant for infrastructure industry, which has been extended to railways.

•Aims to remove the disparity in taxation or differential treatment to manufacturing and service sector.

•Manufacturers will now be encouraged to outsource their logistics and supply chain operations.

Roadways:

Type of Road Length (in km) Percentage

Expressways 200 ---

National Highways (NH) 70,548 2.12%

State Highways (SH) 1,31,699 3.96%Major District Roads (MDR) 4,67,763 14.08%

Rural and Other Roads 26,50,000 79.81%

Total Length 33,20,210

A few Vital Stats ..

•70% of freight taken by roads

•NH carries about 40% of road traffic

•Avg. truck speed in NH – 20 to 30 km / hr

•SH and MDR carries 40% of road traffic

•Traffic on roads is growing by 7% - 10%

•Vehicle population 12% growth

Infrastructure

Post-Liberalization Average Growth of NH

during each 5 YP is 24.08%

Number of kilometers added post-

liberalization 39,901 km.

(as of 2009)

(Source till 2005: KPMG)

Total Length 33,20,210

610840

1430

2086

0

500

1000

1500

2000

2500

1995 2000 2005 2009

Road Freight Valuation (INR billion)

1.9

2.63.1

3.5

4.64.9

3.8

0

1

2

3

4

5

6

Sale of Commercial Vehicles (in lakhs)

(Source : SIAM)

Post liberalization growth 9.1% and

growth from 2000 is 10.6%

Growth in Commercial

vehicles from 2002-03 is 12.2%

S. No. Name of Project Likely Cost ( INR billion) Completion Dates

1. Completion of GQ and EW-NS corridors (Phase I and II)

524 December 2009

2. 4 -laning of 11,113 km under NHDP Phase-III 724 December 2013

3. 2-laning with paved shoulders of 20,000 km of National Highways under NHDP Phase-IV

278 ---

4. 6-laning of selected stretches of National Highways under NHDP Phase-V

412 December 2012

5. Development of 1000 km of expressways under NHDP Phase-VI

166 December 2015

6. Construction of ring roads, flyovers and bypasses on selected stretches under NHDP Phase-VII.

166 December 2015

Total 2,272

Projects undertaken by NHAI:Infrastructure Development Projects:

Corridors Total Length(in km)

Length Completed(in km)

Length Under implementation(in km)

Balance for award (in km)

Golden Quadrilateral 5846 5713 133 ----

North-South & East-West

7142 3291 3030 821

Port Connectivity 380 206 168 06

NHDP Phase-III 12,109 659 1816 9624

NHDP Phase-V 6500 77 953 5470

Total 32939 10705 6283 15951

Out of a total length of 6283 kmsunder implementation, 4/6 laning has been completed for a partial length of 2130 kms.

Current Status of Projects:

(as of Dec 2009)

Infrastructure

Development Projects:

Delhi Mumbai Industrial CorridorDelhi-Mumbai Industrial Corridor is a mega infra-structure project of $90 billion with the financial & technical aids from Japan, covering an overall length of 1483 KMs between the Dadri in Delhi and JNPT in Mumbai.

This Dedicated Freight Corridor envisages a high-speed connectivity for High Axle Load Wagons (25 Tonne) of Double Stacked Container Trains supported by high power locomotives.

Distribution of length of the corridor indicates that Rajasthan (39%) and Gujarat (38%) together constitute 77% of the total length of the alignment of freight corridor, followed by Haryana and Maharashtra 10% each and Uttar Pradesh and National Capital Region of Delhi 1.5 % of total length each.

Major Industrial Regions

National Expressway:

ØTarget: 15,766 km.

ØPhasing of expressway: 2012, 2017, 2022

ØProject Cost estimation: >> INR 2.5 trillion

ØPlan for Phase I: 3,530 km (Report from Yahoo News 9th Dec ’09)ØEstimated Cost for Phase I: Rs. 20,000 crore.

ØLanes: 6 to 8 lanes

Ø11 stretches and 12 states identified

Pradesh and National Capital Region of Delhi 1.5 % of total length each.

This project incorporates vNine Mega Industrial zones of about 200-250 sq. km., vHigh speed freight line, vThree ports, and vSix air ports; vSix-lane intersection-free expressway connecting Delhi and Mumbai v4000 MW power plant.

Several industrial estates and clusters, industrial hubs, with top-of-the-line infrastructure would be developed along this corridor to attract more foreign investment.

Funds for the projects would come from the Indian government, Japanese loans, and investment by Japanese firms and through Japan depository receipts issued by the Indian companies.

Railways:

(as of 2009)

Passenger traffic / day 18 million

Freight traffic / day 2 million tonnes

Railway coverage 63,465 km

Freights wagons 2,00,000

Coaches 50,000

Locomotives 8,000

Infrastructure

Coal 43%

Ore to Steel

plants8%

Ore -Export

7%

Cement9%

POL5%

Foodgrains6%

Fertilizers5%

Iron & Steel3% Others

14%

Railways Cargo Constituents and its share

8%7%

308363

416

473

534

0

100

200

300

400

500

600

Freight Earnings (INR billion)

602667

726785

848

0100200300400500600700800900

Cargo (in million metric tonnes)

Growth of 14.75%

Growth of 8.9%

Dedicated Freight Corridor – Rs. 40,000 crore

Western Corridor 1483 km JNPT in Mumbai to Dadri in U.P

Infrastructure Development Projects:

Logistics Park:

Western DFC (in kms)

Haryana 192

Rajasthan 553

Gujarat 588

Maharashtra 150

Total 1483

States Traversed

Corridor 1483 km JNPT in Mumbai to Dadri in U.P

Projected Traffic (in million tonnes)

Logistics Park:

Proposed to set up Logistics Parks at

1. Mumbai area, particularly in the vicinity of Kalyan-Ulhasnagar or Vashi-Belapur in Navi Mumbai.

2. Vapi in southern Gujarat3. Ahmedabad area in Gujarat, 4. Gandhidham in the Kutch region of Gujarat5. Jaipur area in Rajasthan, 6. NCR of Delhi.

These parks are proposed to be developed on Public Private Partnership mode by creating a sub-SPV for the same.

Cargo Constituents:

Ø ISO containers from JNPT and Mumbai Port in Maharashtra and ports of Pipavav, Mundra and Kandla in Gujarat destined for ICDs located in northern India

Ø POL, Fertilizers, Food grains, Salt, Coal, Iron & Steel and Cement.

23

40

0.69

6.2

0

5

10

15

20

25

30

35

40

45

2005-06 2021-22

Western Corridor Container WC

Development Projects:Infrastructure

Eastern DFC (in kms)

Punjab 102

Haryana 82

Uttar Pradesh 1002

Bihar 93

Total 1279

States Traversed

Eastern Eastern Corridor 1279 kmSonnagar in Bihar to Ludhiana in Punjab

Logistics Parks:

It is also proposed to set up Logistics Park at Kanpur in U.P. and Ludhiana in Punjab.

The parks are proposed to be developed on Public Private Partnership mode by creating a sub-SPV for the same.

Cargo constituents:

Coal, finished steel, food grains, cement, fertilizer, limestone and general goods

38

116

0

20

40

60

80

100

120

140

2005-06 2021-22

Projected Traffic (in million tonnes)

New Line Projects 12%

Grade

Freight Terminals 2%

Other Traffic Facility works

3%Logistic Park

1%

Railway Electrification 4%

Metropolitan Projects 6%

Other Measures for Enhancing Capacity

3%

Running Of 25 Tones Axle Load On Iron Ore Routes

3%

Running Of 23/24 Coach Length Trains

1%

Capacity Enhancement – Spread of Funds

Funds for setting up Logistics park

Rs. 770 crore

Gauge Conversion 24%

Doubling 25%

Traffic Facility Works 11%Mega Terminals at

Metropolitan cities 2%

Terminals at State Capitals and important tourists

places 1%

Grade Separators/Flyovers/Bye-

pass lines 2%

Total Funds allocated in 11th five year plan: Rs. 77,050 crore

Ports:

No. Traffic Capacity

(as of 2006-07)

Projections for 2012:Traffic Capacity

Major Ports 12 465.7 MT 508.6 MT

Minor Ports 187 170 MT 228.31 MT

A few Vital Stats ..

*Some 60% of India’s container traffic is handled by the Jawaharlal Nehru Port Trust in Mumbai

*It has just 9 berths compared to 40 in the main port of Singapore.

*It takes an average of 21 days to clear import cargo in India compared to just 3 in Singapore.

*Cargo handling is projected to grow at 7.7% until 2013-14.

*Only 43 of the 187 minor ports can handle cargo

*Mundra port alone handles 60% of minor port traffic

Major ports 800 MT 1001.8 MT

Minor ports 300 MT 345.19 MT

Infrastructure

Coal 13%

Container12%

Others 17%

Ports Cargo Constituents and its

Development Project:NMDP (National Maritime Development Programme):Objective:• Upgrade and modernize the port infrastructure in India and benchmark its performance against global standards.• Total investment for the programme is Rs. 1, 00,339 crore and out of them about Rs. 34,505 crore is expected from the private sector.

Allocation Rs. 55,804 crore for port sector.

Rs. 44,535 crore for shipping and inland water transport sectors.

Target To be completed in phases within 2011-12.

No. of Projects

276

Project Covers

•Construction / up gradation of birth,

•Deepening of channels,

•Rail / road connectivity projects,

•Equipment up gradation and modernization scheme,

•Other related schemes for creation of backup facilities.

Minor ports 300 MT 345.19 MTPOL & its products

36%Iron Ore18%

Fertilizer and FRM

4%

12%Constituents and its

Share

Civil Aviation:

No. of Airports 449 airports / airstrips

Under AAI 92 airports and28 Civil enclaves at defence airfields

Major Airports 6

Non Metro Airports 35

Domestic Airports 87

International Airports 12•12.1% growth rate in Internatinalcargo •10.1% growth rate in domestic

Major Cargo Constituents•Express Mail•Computers•Chips•Electronic and Optical Equipment•Precision Instruments•Perishable food stuff

Major Airport

s88%

Non Metro Airport

s12%

Share in cargo traffic

Infrastructure

1.2

1.8

0.60.8

00.20.40.60.8

11.21.41.61.8

2

2008-09 2011-12 (E)

International Domestic

Cargo (in million metric tonnes)

(as of 2009)

•10.1% growth rate in domestic cargo

Development Project:

MIHAN (Multi-modal International Cargo Hub and Airport at Nagpur.)

Cost: INR 25.8 billion

>> Spread over an area of 4025 Hectares

>> The airport will have parking space for 50 aircraft at any time with 50 additional bays at fringe areas.

>> With a projected target of serving 14 million passengers and handle 0.87 million tonnes of cargo this is one of largest aviation project in India.

The Cargo hub in Nagpur is built to handle nearly 50% of the total air cargo traffic

all over India

AAI: Airport Authority of India

Warehouses:As per planning commission & industry estimates: • Total existing warehousing capacity is 80 million MT out of which CWC has 10.8 million MT and 21.9.million MT in

SWC• There are three agencies in the public sector which are engaged in building large scale storage/warehousing

capacity, namely, Food Corporation of India (FCI), Central Warehousing Corporation (CWC) and 17 State Warehousing Corporations (SWCs).

Requirement:• Additional warehousing capacity of 35 million MT in next 5 to 10 years at an investment of about INR 6 billion.

Current Status:

vMajor investments on these infrastructures have come from Government agencies like CWC, SWC, CONCOR etc.vCurrent private sector initiatives are small and sporadic.

Infrastructure

Developmental Works:• IL&FS is working with Continental Warehousing Corporation Ltd to set up six agri parks across IndiaFTWZ• Primary objective is to create trade related infrastructure, envisaging world-class infrastructure for warehousing

of various products• FTWZ addresses these issues effectively as they would enable supply chain / logistics to function much more

efficiently by removing the cargo bottlenecks witnessed at the ICDs• In addition, such zones are envisaged to provide common infrastructure such as storage and handling

equipments, shared storage space, etc. which would enable the apportionment of associated capital costs across a larger base of users leading to significant costs reduction.

Reference: IF&LS

vCurrent private sector initiatives are small and sporadic.vPrivate sector warehousing are of poor quality, small, fragmented and does not meet infrastructure standards.vNo quality standards or benchmarks are followed in infrastructure creation

INLAND CONTAINER DEPOTS (ICD)

Ø Robust growth of exim trade and capacity constraints in movement and evacuation of cargo has lead to a surging demand for greenfield ICDs and expansion of existing facilities

Ø At least 40 to 50 new rail/ road ICDs/ CFS across the country needed to handle the projected traffic in next 5 to 10 years

Ø IL&FS is initiating development of ICDs on PPP format with agencies like CONCOR as well as private enterprises with the objective of filling up this critical infrastructure need

Ø To create economies of scale, the business plan of ICD is being expanded to include SCM functions like warehousing, C&F and other value added services to give the project shape of “Mega Logistics Park”

INTEGRATED TRANSPORT CENTER

v The unplanned development of transport nagars across major industrial townships, metros, mini metros etc.This has led to inefficient utilization of space, shabby infrastructures, road jams and danger to human life

v IL&FS has initiated development of integrated and modern logistics cum transport centers across major locations in the country on PPP format

v The centers will lead to integrated development of warehousing, transportation and traffic planning leading to a much better logistics operations

v Development of such integrated estates on in Uttaranchal, Chattisgarh, North East and Jharkahnd, in collaboration with respective State Governments

Reference: IF&LS

Manufacturing IndustryIndustry Size in 2009 (in INR billion)

Impact on the

Logistics Sector

15%

6%5%

4%3% 3%

0%2%4%6%8%

10%12%14%16% Cost of Logistics to Total Sales 2412

2200

1480

605 590 489

0

500

1000

1500

2000

2500

3000

Steel Textiles Auto Cement FMCG F&B

Share of Logistics (in INR billion)Cement Industry:Challenge:•Road transportation beyond 200 kms is not economical therefore about 55% of cement is being moved by the railways. There is also the problem of inadequate availability of wagons especially on western railways and southeastern railways.

Opportunity:•Under this scenario, manufacturers are looking for sea routes, this being not only cheap but also reducing the losses in transit.

•Today, 70% of the cement movementworldwide is by sea compared to 1% in India.

Sector

145

66

44

91

24 24

0

20

40

60

80

100

120

140

160

Steel Textiles Auto Cement FMCG F&B

Country Logistics Cost / GDP

China 13% to 15%

US, UK 9%

Europe 10%

Japan 11.4%

India (45% of GDP) 13% to 14%

Comparison amongst different countries

Country Logistics activities performed by 3PL / Logistics activities

China, India <10%

Infrastructure Bottlenecks

Developed

CurrentGDP (in INR trillion)

GDP in 2029with a growth rate of 7% (in INR trillion)

Share ofLogistics (11% of 45% of GDP) (in INR trillion)

Share of 3PLand 4PL with a 30% market Share (in INR trillion)

Share of 3PLand 4PL with 40% market share (in INR trillion)

55 212.83 10.53 3.16 4.21

China, India <10%

US, UK 57%

Europe 30% to 40%

Japan 80%

Estimated Size of 3PL and 4PL in 20 Years

That’s about 40 times jump in market size in a span of 20 years from the current

market size of INR 78 billion

Emerging

HighLow

Definition of 3PL:• A 3PL provider is a company which supplies /co-ordinates logistics functions across multiple links in the supply

chain.• The company acts as a ‘third party’ facilitator between seller/manufacturer (the ‘first party’) and buyer/user

(the ‘second party’).”

Design Market

Manufacturing Unit

Supply Chain Model3PL 3PL

Supplier’sSupplier

SuppliersDistributers

Customers/ End UsersAcquire Convert Distribute

Mngmt Control

3PL3PL

Why 3PL ?

üOperational cost reduction

ü Reduced cycle time

ü More specialized logistics expertise

ü Improve on time delivery

ü Enhance geographic reach

ü Flexibility in operations

vImprove focus on core activities

vImprove return on assets

vDiverting capital investment

vAccess/ Expansion to unfamiliar market

vHigher Profitability

vIncreased Sales and Market Share

vEnhanced Customer Service

For Operation Efficiency For Business Growth

vEnhanced Customer Service

• Inability to respond to changing needs

• Lack of grasp of business goals

• Unreliable promises from providers

• Concerns about capability of providers

• Fear of leakage of important information

• Non compatibility of IT systems

• Difficulty to manage and change provider

• Fear of loss of control

• Lack of confidence in provider

• Poor infrastructure of providers company

Why not?

4PL:

v It acts as single interface between the client and multiple logistics service providers.

v All aspects of the client’s supply chain are managed by the 4PL organisation.

v The 4PL organization is often separate entity established as a joint venture or long term contractbetween a primarily client and one or more partners.

v It is also possible for a major 3PL provider to form a 4PL organisation within existing structure.

Client

4PL

3PL

3PL

3PL

Key Characteristics:

§ Hybrid organisation formed from a number of different entities

§ Typically established as a JV or long term contract

§ Responsible for management and operation of entiresupply chain

§ Continuous flow of information between partners and4PL organisation

SWOT Analysis of Logistics Sector:

STRENGTHSü Extremely critical for manufacturing

industry and agri commodity industryü No dearth in volumesü Critical component in operational efficiencyü Contributes heavily towards customer

satisfaction

WEAKNESSØ High cost – low margin businessØ Large number of unorganized playersØ Low IT penetrationØ Highly fragmentedØ High Capital expenditure

OPPORTUNITIES• Implementation of GST from 1st April 2011• Implementation of Golden quadrilateral

and NS-EW corridors.THREATSv Increase in fuel costsand NS-EW corridors.

• Heavy investments to improve infrastructure through developmental projects like Mihan, delhi-mumbaiindustrial corridor, Dedicated freight corridor and National Maritime Development Projects.

v Increase in fuel costsv Government Policyv Taxation

Challenges:

Solution / Opportunity:üImplies that a truckload loss of Goods is always round the corner. Organized players can cash in by providing the requisite level of safety and insurance cover for goods.

Unfair CompetitionØUnorganized players get away without paying taxesØDon’t follow the operating norms stipulated in the motor vehicle act such as quality of drivers, vehicles, volume and weight restriction.

Diseconomies of scaleØDifferential sales tax structure in different statesØApart from non-uniform tax structure, LSP’s (Logistics Service Provider) have to pay other kinds of taxes like octrois.ØGovernments failure in implementation of VAT since 1st of April 2005

Solution / Opportunity:üProposal for implementation of GST. With uniform taxation across all states companies could focus on supply chain efficiency rather than Tax avoidance optimization.

Face multiple check post

ØThis delays the process of deliveryØCompliance with varying documentation requirement of different states is certainly a difficulty.

Solution / Opportunity:üIntegration of IT into the process like EDI could greatly speed up the whole process and bring in the required efficiency.certainly a difficulty. required efficiency.

Bribery and Police harassmentØ$5 billion paid by truckers annually

Solution / Opportunity:üThe scenario could grossly change with greater penetration of Organized players.

Low IT penetrationØLack of communication infrastructureØLack of visibilityØLack of real time tracking abilityØThis leads to a lot of uncertainty and lack of transparency in terms of cost structure and service delivery

Solution / Opportunity:üPenetration of 3PL players and high level of investments into technology like GPRS would change the scenario.

Highly Fragmented Sector

ØLSP’s stick to their basic services. They don’t provide value added services like packaging / labeling, order processing, distribution, customer support etc.

Solution / Opportunity:üValue Added Services provides a great opportunity to increase the margins.

Listed ShippingCompanies - Large

Essar Shipping

GE Shipping Co

Great Offshore

Mercator Lines

S C I

Varun Ship. Co.

Listed Shipping

Road Transport Companies Associated Road CRC Carrier Patel Integrated

ABC India Autoriders Intl. Delhi Assam Rdwy Peirce Leslie(I)

Adani Agri Log. Balurghat Tech Premier Road Car

Agarwal Indl. Broekman Logisti DLF Retail Reliance Logis.

Agrocargo Trans. Bulk Cem.Corpn. E I T A India Roadways India

Allcargo Global Central Province Frontline Corp. SER Inds.

Alltrans Logistc Chart.Logistics Inland Vikash Southern Roadwys

Some of the major logistics companies ..

Listed ShippingCompanies – Medium

& Small

Chowgule Steam

Garware Offshore

SEAMEC Ltd

Shreyas Shipping

SKS Logistics

Alltrans Port Coastal Roadways Inter State Oil Sri Venkatesa Tr

Arshiya Intl. Kausar India T N St Trans Coi

Arvind Roadlines Containerway Int T N St Trans Kum

Assam Beng.Carr Wilson Sandhu Vins Overseas Transport Corp.

Courier Corporate Courier

Orbit Multimedia

Blue Dart Exp. Gati Skypak Serv. Sp.

Chokhani Global Killick Air CourElbee Express

Elbee Services

mundra port

Container Corpn.

KonkanRly.Corpn

gateway dis

Delhi Metro Rail

MERCI BEAUCOUP ..

Source and References

BEAUCOUP ..

Mumbai-Pune Expressway Ganga Expressway

Taj Expressway Kundli-Manesar-Palwal Expressway(KMP)

Delhi-Noida Direct Flyway Eastern Peripheral Expressway

Chennai-Bangalore Expressway Pathankot-Jalandhar-Ajmer Expressway

Jaipur-Kishangarh Expressway Bangalore-Mysore Expressway

Durgapur Expressway Hosur Road Expressway

Belghoria Expressway PV Narsimha Rao Expressway to HIAL

National Expressway

Cost estimation for a 100 km 4 lane expressway - Rs. 1784Cost estimation for a 100 km 6 lane expressway - Rs. 2548

Funding options including PPP mode, cost sharing by states/ Centre, Commercial utilization of land within/beyond ROW etc.

At present expressway handles about 30,000 PCUs and is designed to handle up to 10,00,000 PCUs.

PSU: Passenger Carrying Units

Panipat Elevated Expressway Chennai Elevated Expressway

Shimla-Chandigarh Expressway Mumbai eastern Freeway that starts from CST

The Uttar Pradesh government is planning five more expressways in the state.

• Greater Noida-Saharanpur-Dehradun expressway (in partnership with the Uttarakhand state government)

• Jhansi-Lucknow expressway

• Lucknow-Gorakhpur expressway

• Agra-Kanpur-Lucknow expressway

• Farrukhabad-Kotdwar expressway.

The five proposed expressways will have a combined length of around 1,400km.

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Sr.No. Name of the State /Union Territory Length (Kms)

1 Andhra Pradesh 4,537

2 Arunachal Pradesh 1992

3 Assam 2836

4 Bihar 3642

5 Chandigarh 24

6 Chhatisgarh 2184

7 Delhi 72

8 Goa 269

9 Gujarat 3245

10 Haryana 1512

11 Himachal Pradesh 1409

12 Jammu & Kashmir 1245

22 Nagaland 494

23 Orissa 3704

24 Pondicherry 53

25 Punjab 1557

26 Rajasthan 5585

27 Sikkim 62

28 Tamil Nadu 4832

29 Tripura 400

30 Uttar Pradesh 5874

31 Uttaranchal 1991

32 West Bengal 2524

33 Andaman & Nicobar 300

National Highways

13 Jharkhand 1805

14 Karnataka 4396

15 Kerala 1457

16 Uttarakhand 2042

17 Madhya Pradesh 4670

18 Maharashtra 4176

19 Manipur 959

20 Meghalaya 810

21 Mizoram 927

Total 70,548

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PORT 2003-04 2004-05 2005-06 2006-07 2007-08 % Growth Annualised growth

KOLKATA 8,693 9,945 10,806 12,596 13,741 58.07 12.13%

HALDIA 32,567 36,262 42,337 42,454 43,541 33.70 7.53%

PARADIP 25,311 30,104 33,109 38,517 42,438 67.67 13.79%

VIZAG 47,736 50,147 55,801 56,385 64,597 35.32 7.86%

ENNORE 9,277 9,480 9,168 10,714 11,563 24.64 5.66%

CHEENAI 36,710 43,806 47,248 53,414 57,154 55.69 11.70%

TUTICORIN 13,678 15,811 17,139 18,001 21,480 57.04 11.94%

Cargo handled by the Major Ports in tonnes of '000

COCHIN 13,572 14,095 13,887 15,257 15,810 16.49 3.89%

NMPT 26,673 33,891 34,451 32,042 36,019 35.04 7.80%

MORMUGAO 27,874 30,659 31,688 34,241 35,128 26.02 5.95%

MUMBAI 29,995 35,187 44,190 52,364 57,039 90.16 17.43%

JNPT 31,190 32,808 37,836 44,815 55,756 57.60 15.63%

KANDLA 41,523 41,551 45,907 52,982 64,893 56.28 11.81%

TOTAL 3,44,799 3,83,746 4,23,567 4,63,782 5,19,159 50.58 10.77%

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Sector Employment Interms of contribution

Agriculture 60.00% 27.00%

Service 28.00% 55.00%

Industrial 12.00% 18.00%

GDP and industry contribution

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Major items of exports:

* Cotton yarn, fabrics made ups etc.

* drugs, pharmaceuticals and fine chemicals

* manufactures of Metals

* Machinery and Instruments

* Man made Yarn, Fabrics Made ups

Major Items of imports:

* Gold,

* Cashew Nuts

* Inorganic Chemicals,

* Wood & Wood Products,

* Metalifers ors & Metal Scrap,

* Iron & Steel,

* Cotton raw. Comb/uncombed/waste,

Major Exports Industries

Petroleum products

Textile goods

Gems and jewellary

EXIM

* Man made Yarn, Fabrics Made ups

* Transport equipment

* Primary and Semi finished iron and steel

* RMG cotton including accessories

* Plastic and linoleum products

* Inorganic/organic/agro chemicals.

* Coal, coke & Briquettes etc.

* Pulp and waste paper,

* Non ferrous metals,

* Organic chemicals,

* Machinery except elect. & electronic,

* Fertilizer crude,

* Electronic goods,

* Pearls precious semiprecious stones.

Engineering goods

Chemicals

Leather

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Major agricultural products include •Rice•Wheat•Oilseed •Cotton •Tea •Potatoes •Jute sugarcane

Poultry and diary products•Cattle •Water buffalo •Sheep •Goats •Poultry •Fish

Catering to Agricultural Industry

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Major Industries

Textiles Cement

Chemicals Mining

Food processing Petroleum

Steel Machinery

Transportation equipment Software

Industrial Regions

• Mumbai-Pune Region,

• Hugli Region,

• Bangalore-Tamil Nadu Region,

• Gujarat Region,

• ChhotaNagpur Region,

• Vishakhapatnam-Guntur Region,

• Gurgaon-Delhi-Meerut Region,

• Kollam-Thiruvantapuram Region.

Major Industrial belts

.. Ambala-Amritsar

.. Saharanpur-Muzzaffarnagar

.. Indorer-Dewas-Ujjaini

.. Jaipur-Ajmer

.. Kolhapur-South Kannada

.. Northern-Malabar

.. Middle Malabar

.. Adilabad-Nizambad

.. Allahabad-Varanasi-Mirzapur

.. Bhojpur-Mungar

.. Durg-Raipur

.. Bilaspur-Korba

.. Brahmaputra valley Back