LOGISTICS SECTOR IN INDIA: ECONOMY

LOGISTICS SECTOR IN INDIA: ECONOMY

NEWS: Steering the decarbonisation of India’s logistics sector

WHAT’S IN THE NEWS?

India’s logistics sector, responsible for 13.5% of the country’s greenhouse gas emissions, urgently needs a green transformation to support sustainable economic growth. Shifting freight to rail, electrifying transport, and adopting cleaner fuels in shipping and warehousing are key to meeting India’s net-zero target by 2070.

Importance of the Logistics Sector in India

  • The logistics sector is vital to India’s economy, enabling the movement of goods and services across states and connecting producers to markets.
  • It plays a foundational role in supporting manufacturing, agriculture, retail, e-commerce, and export industries.
  • As India targets a US$ 5.5 trillion economy by 2027, a robust, efficient, and green logistics network is key to achieving sustainable economic growth.

High Carbon Footprint of the Sector

  • The logistics sector is one of the most carbon-intensive industries in India, contributing to 13.5% of the country’s total greenhouse gas (GHG) emissions.
  • Road transport alone contributes over 88% of logistics-related emissions, making it the largest polluter within the sector.
  • Trucks account for 38% of carbon dioxide emissions, largely due to the reliance on diesel and the inefficiencies in road freight movement.
  • Other contributors include:
  • Aviation: Though less frequent, aviation has a disproportionately high carbon footprint.
  • Shipping: Coastal and inland shipping have lower emissions but still contribute significantly.
  • Warehousing: Traditional warehouses use grid electricity and diesel generators, adding to GHG emissions.

Growth vs. Sustainability Dilemma

  • India’s logistics demand is expected to grow sharply by 2030 with rising industrial activity and urbanization.
  • Inland waterways and coastal shipping are expected to play a bigger role, yet the environmental impact of this growth must be managed.
  • Balancing rapid economic expansion with climate commitments is a critical challenge.

Global Comparisons and Lessons

  • China and the United States have successfully reduced emissions by shifting significant freight volumes from road to rail, a more energy-efficient and lower-emission mode of transport.
  • Rail offers nearly zero-emissions options, especially when electrified or powered by clean energy.
  • India can adopt similar strategies to reduce dependence on road freight.

Recommended Solutions and Strategies

  • Shift freight from road to rail:
  • Increase the share of goods transported via Indian Railways.
  • Improve rail infrastructure and ensure time-bound deliveries to make it competitive.
  • Electrify road freight:
  • Expand the use of electric trucks, especially for last-mile delivery.
  • The Delhi–Jaipur green freight corridor pilot is a positive step that can be scaled nationwide.
  • Promote coastal shipping and inland waterways:
  • Encourage cargo movement through cleaner, energy-efficient waterways.
  • Use cleaner fuels like Liquefied Natural Gas (LNG), biofuels, and hydrogen.
  • Sustainable aviation:
  • Although aviation is hard to decarbonise, promoting sustainable aviation fuels (SAF) and carbon offsetting in other sectors can help reduce its environmental impact.
  • Green warehousing:
  • Install solar panels, use energy-efficient lighting and HVAC systems, and transition to renewable electricity.
  • Implement green building standards and automation to reduce energy consumption.

Conclusion and Way Forward

  • India has committed to achieving net zero emissions by 2070, and transforming the logistics sector is a crucial component of this vision.
  • A comprehensive green logistics strategy should include:
  • Expansion of low-carbon rail freight systems.
  • Electrification of road-based freight and support for EV charging infrastructure.
  • Decarbonisation of maritime transport and adoption of clean fuels.
  • Transitioning warehouses to renewable energy sources and green building standards.
  • A sustainable logistics sector will not only support climate goals but also make India globally competitive by improving efficiency, reducing fuel costs, and attracting green investments.

Source: https://www.thehindu.com/opinion/op-ed/steering-the-decarbonisation-of-indias-logistics-sector/article69465562.ece