India’s Logistics Sector balances Tariff Shocks with Transformational Reforms: Rubix Data Sciences Report
MUMBAI: India’s logistics sector is undergoing a pivotal transformation, with bold domestic reforms offsetting turbulence in global trade. The newly introduced Indian Ports Bill, 2025, which streamlines governance and standardises processes under the ‘One Nation–One Port’ framework, comes at a time when the imposition of steep U.S. tariffs on Indian exports threatens to disrupt trade flows. Even as estimates suggest shipping lines were taking steps to cut capacity by 25% on U.S.-bound routes, India’s infrastructure push and cost efficiencies are reshaping its logistics ecosystem into a more resilient and competitive force. A new report by Rubix Data Sciences, a risk management and monitoring company, outlines how highways, railways, aviation, and ports are converging with policy reforms to move India up the global logistics value chain.
On the infrastructure front, the report highlights the rapid growth of India’s highway network, which has expanded 60% in the past decade to 146,204 km in 2024–25, supported by faster construction speeds that now average 29 km per day compared to 11.6 km per day in 2013–14. The National Highways Authority of India is also preparing to invite bids worth ₹3.4 trillion for 124 projects spanning 6,376 km. These projects are expected to ease bottlenecks and strengthen last-mile connectivity, thereby reducing logistics costs further.
The efficiency story is equally striking. Road freight, which accounts for nearly 89% of India’s cargo, has seen costs fall sharply from 16% of GDP to around 10%, with a single-digit target within sight by year-end. This transition is positioning India closer to the logistics cost benchmarks of advanced economies and helping exporters absorb the shock of higher landed costs caused by global tariffs.
The report also highlights the reinvention of Indian Railways, now the world’s second-largest-cargo-carrying railway, having transported 1,617 million tonnes in FY2025 with a target of 1,702 MT in FY2026. Rail has become a key enabler for the automotive sector, with the share of cars transported by rail jumping from 1.5% in 2013–14 to 25% in 2025, aided by innovations like double-decker car-carrying wagons. India has simultaneously emerged as the world’s top locomotive manufacturer, producing 1,600 units in 2024, surpassing the combined output of the U.S., Europe, and Japan.
In aviation, the report notes that India is aiming to triple its air cargo capacity by 2030, propelled by the exponential growth of e-commerce, pharmaceuticals, and electronics. The value of e-commerce–driven air cargo alone is projected to rise from USD 5 billion today to USD 200 billion by 2030. Maritime logistics, too, is expanding rapidly, with ports handling 1,594 million tonnes of cargo in FY2025 at a CAGR of 6% over FY2022–25. With a target to expand port capacity six-fold to 10,000 MTPA by 2047, India’s vision is to become one among the world’s top five shipping nations.
Yet, global headwinds remain. The Rubix report cautions that the imposition of 50% tariffs by the U.S. on Indian exports is weighing heavily on trade sentiment. While tariffs do not directly raise freight charges, they increase landed costs and depress demand, leading to significant capacity cuts on U.S.-bound shipping routes. Exporters attempted to front-load shipments ahead of tariff implementation, pushing containerised exports to the U.S. up by 9% in the first half of 2025, but the sustainability of this surge remains uncertain.
Commenting on the findings, Mohan Ramaswamy, Co-founder and CEO of Rubix Data Sciences, said, “India’s logistics sector is at a defining moment. Even as new U.S. tariffs challenge exporters, reforms like the Indian Ports Bill, 2025 and the rapid expansion of highways and freight corridors are laying the foundation for a more competitive, efficient, and resilient trade ecosystem. At Rubix, we see this convergence of policy and infrastructure as a powerful signal that India is preparing to move up the global logistics value chain.”
As India seeks to future-proof its logistics, the Rubix report underscores how the alignment of infrastructure expansion, cost efficiency, and policy reform is creating a more competitive landscape for domestic players while strengthening the country’s resilience to external shocks.
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