How did logistics and e-commerce shape India’s growth in 2024?

Two decades ago, buying a mobile phone or groceries meant visiting bustling markets. Today, it’s a matter of minutes. My friend, Rahul, a technology professional in Bangalore, realised this during a virtual meeting when his pen ran out of ink. A quick tap on his favourite app, and within seven minutes, a new pen was delivered to his doorstep. This is the story of India’s e-commerce revolution—transforming how we live, shop, and connect.

India’s e-commerce industry, projected to reach $325 billion by 2030, is a testament to innovation. According to a YouGov study, 73% of urban Indians shop online for convenience, and 64% prefer user-friendly apps. While 63% plan their purchases, 20% admit to impulse buys, like Rahul’s last-minute orders.

Shoppers, spending ₹1,000–₹5,000 monthly, favour smartphones (59%) and skin care (50%) as top categories. Yet, when it comes to furniture and jewellery, 53% still prefer offline stores, valuing the experience of seeing and touching products.

Driving this digital surge is a robust logistical backbone. Ports and air cargo hubs ensure seamless trade, enabling artisans and potters in Jaipur and Mithila to ship handmade pottery globally.

Talking about logistics, Ketan Kulkarni, Deputy Managing Director, Gati Express and Supply Chain Pvt. Ltd. (GESCPL) said, "Enhancing connectivity, achieving cost efficiency and building resilience and agility through technology adoption and capacity building have been key drivers as the logistics industry continues to enable India's vision for Viksit Bharat 2047. Progress in rail and waterway freight movement, alongside extensive highway construction, has heralded a new era of multi-modal connectivity, setting the logistics sector on a robust growth trajectory. This progress strengthens India’s position as a rising global economic powerhouse."

Empowered by technologies like AI, blockchain, and IoT, small businesses are thriving. As a result, even a textile entrepreneur in Gujarat has reached global audiences through social media ads and AI-driven insights.

India’s e-commerce evolution is more than convenience—it’s about empowering millions, building a connected economy, and shaping a future where every click contributes to a stronger, more inclusive India.

E-commerce in India: A sector in rapid expansion
India’s e-commerce sector has witnessed exponential growth in recent years, driven by advancements in technology, increasing internet penetration, and a shift in consumer preferences towards online shopping. According to the Indian Brand Equity Foundation (IBEF), India’s e-commerce market was valued at $85 billion in 2023 and is expected to reach $200 billion by 2026, reflecting a compound annual growth rate (CAGR) of 20-25%. By 2030, India’s e-commerce industry is projected to reach $325 billion, marking it as a significant global player in digital commerce.

Giving a recap of 2024, Saahil Goel, MD and CEO at Shiprocket, said, "2024 has been a defining year for the Indian e-commerce industry, underscoring the strides we are making towards the ambitious goal of reaching $325 billion by 2030. A decade ago, the idea of receiving clothes and accessories in 10 minutes, witnessing drone deliveries, or seeing sellers from Bharat's remotest regions shine on the global stage seemed almost like a dream. Today, this is our reality, powered by the confluence of technology, government initiatives, and entrepreneurial spirit."

Adding to it, Shashwat Swaroop, Founder at Marmeto, said, "This year has seen monumental growth and transformation for commerce, driven by India's unique blend of digital innovation and consumer demand. The past year has seen a deeper penetration of commerce into Tier II and III cities, backed by enhanced internet access, improved logistics, seamless payment systems, heightened preference for online shopping and the rise of mobile-first shoppers."

Technological advancements and digital Innovation
The rapid rise in internet users, with 895 million internet connections recorded in June 2023, alongside a smartphone base that is expected to reach 1.1 billion by 2025, has been pivotal to India’s e-commerce growth. "Groundbreaking technologies such as artificial intelligence, machine learning, blockchain, and the Internet of Things (IoT) have moved beyond the domain of large corporations, becoming accessible tools for MSMEs to drive efficiency, growth, and consumer engagement,” mentioned Goel.

Adding to that, Kulkarni said, "As we look toward 2025, our focus will sharpen on fostering seamless connectivity, improving operational efficiencies and deepening our commitment to sustainable practices. Building on the progress of 2024, we at Allcargo Gati remain steadfast in our mission to empower businesses, strengthen supply chains, and drive India’s economic growth, contributing to the realization of a self-reliant, prosperous India."

He further added, “The role of AI-driven recommendations and social commerce has been particularly significant, with 84% of consumers making purchase decisions influenced by promotions or influencer content. At the same time, visionary government bodies like ONDC, DGFT, and India Post have democratised access to digital markets, enabling small businesses to scale seamlessly and contribute to a vibrant, interconnected economy.

Talking about the way ahead, Swaroop said, "2025 will see focus on refining the fundamentals such as enhancing the omni-channel experience to blur the lines between online and offline commerce, streamlining supply chains for faster delivery, and creating personalised shopping experiences that cater to diverse consumer bases. As scale of commerce grows, more and more brands will focus on leveraging tech to help them unlock smooth operations and enable efficient scaling.”

"2024 has been a defining year for the Indian e-commerce industry, underscoring the strides we are making towards the ambitious goal of reaching $325 billion by 2030.”
Saahil Goel, Shiprocket

The role of quick commerce
Talking about 10-minute deliveries and last-moment orders, Goel added, "Quick commerce has emerged as one of the most transformative segments within the e-commerce space, setting new benchmarks for speed and convenience. Expected to contribute an additional $1 billion in GMV, this ultra-fast delivery model has fundamentally reshaped consumer expectations, catering to the demand for immediacy while unlocking new opportunities for businesses. The rapid growth of quick commerce is a testament to the agility and innovation driving the sector, underscoring its role as a key economic catalyst in India's digital economy.”

Cross-border e-commerce
“On the global front, cross-border e-commerce has gained significant momentum, with India’s e-commerce export market valued at approximately $3–4 billion, projected to grow to $200–300 billion by 2030. MSMEs are increasingly leveraging global markets, supported by groundbreaking initiatives like DGFT’s eCommerce Export Hubs, which have levelled the playing field for even the smallest enterprises,” said the Indian e-commerce enablement platform’s founder.

Goel also mentioned that coupled with advancements in TradeTech—such as blockchain, AI, and IoT—these platforms are enabling businesses to navigate the complexities of global trade with unprecedented efficiency, positioning India as a rising powerhouse in international commerce.

The Impact of UPI and digital payments on e-commerce growth
India’s Unified Payments Interface (UPI) has played a significant role in driving e-commerce. In the first quarter of FY24, UPI processed over Rs. 44 lakh crore ($525.5 billion) in transactions (Indian government sources), facilitating smoother digital payments and fostering growth in the e-commerce sector. The seamless integration of digital payments, alongside the rise of internet users, is helping to drive e-commerce adoption across diverse consumer segments, including tier-2 and tier-3 cities.

Government Initiatives to boost e-commerce market
The government has played an integral role in fostering the growth of India’s e-commerce sector. Visionary initiatives like the Open Network for Digital Commerce (ONDC), Digital India, and the promotion of MSMEs (Micro, Small, and Medium Enterprises) have created a conducive environment for digital businesses to scale. Furthermore, supportive policies for logistics, payment systems, and supply chain management have helped improve the overall efficiency of e-commerce operations in the country.

India's ports: Expanding to meet growing trade demands
As India’s e-commerce market expands, so does the need for efficient logistics and shipping infrastructure. India’s ports and airports play a crucial role in handling the growing volume of goods being exported and imported, particularly in the wake of the increasing prominence of cross-border e-commerce. But, before we dive into India’s air cargo sector, let’s understand the present condition of Indian ports.

"As we look toward 2025, our focus will sharpen on fostering seamless connectivity, improving operational efficiencies and deepening our commitment to sustainable practices."

Ketan Kulkarni, Deputy Managing Director, Gati Express and Supply Chain Pvt. Ltd.

The current state of Indian ports
A report by IBEF shows that India’s 12 major ports handled 783.50 million tonnes (MT) of cargo in FY23, and with non-major ports accounting for 45% of the total traffic, the country’s port infrastructure is integral to its economic progress (Indian Ports Association). The major ports, such as Jawaharlal Nehru Port Trust (JNPT), Mundra Port, and Chennai Port, handle the lion’s share of the country’s international trade. Ports are central to India’s import-export activities, and their expansion is vital to meeting the growing demands of e-commerce, especially for cross-border shipments.

India’s non-major ports, particularly in Gujarat, Tamil Nadu, and Maharashtra, are also seeing a rise in cargo handling, which reflects the increasing importance of regional ports in supporting India’s trade growth.

As a result, infrastructure development within India’s ports sector is also accelerating. The government’s Sagarmala Programme is a key initiative aimed at modernising port infrastructure, enhancing connectivity, and reducing logistics costs. The Sagarmala Programme focuses on improving port handling capacity, developing new port terminals, and linking ports with industrial hubs and economic zones (Ministry of Ports, Shipping, and Waterways).

Additionally, the construction of new ports, such as the Vadhavan Port in Maharashtra, and the expansion of existing ones, such as Mundra Port by Adani Ports, are critical to meeting the country’s growing trade needs. The Vadhavan Port, a deep-draft port, will accommodate larger vessels and handle greater volumes of cargo, further boosting India’s EXIM trade capacity.

The role of technology in ports
Similar to the e-commerce sector, India’s port industry is also adopting technological innovations to improve operational efficiency. Automation, AI, IoT, and blockchain are being incorporated into port operations, reducing human error, increasing throughput, and enhancing supply chain visibility. Digital initiatives, including e-port services and port community systems, are helping streamline port operations, facilitate better coordination between stakeholders, and reduce delays.

Key government initiatives to enhance ports
The Indian government has also implemented several measures to boost the ports industry, such as:

The National Maritime Development Programme (NMDP): Aiming to improve the capacity and efficiency of Indian ports (Ministry of Ports, Shipping, and Waterways).

Public-Private Partnerships (PPP): Attracting investment in port development and improving operational efficiency.

FDI Policies: Allowing 100% Foreign Direct Investment (FDI) in port infrastructure projects to modernise facilities and expand capacity (Department for Promotion of Industry and Internal Trade).

These initiatives are expected to help India increase its cargo handling capacity, reduce logistics costs, and enhance its global competitiveness in trade.

Growth of air cargo: Driving India’s logistics ahead
The Indian air cargo sector is set to witness a significant rise in volumes in FY2025, according to a recent report by ICRA. The report projects a growth of around 9-11% YoY, with international cargo expected to see double-digit growth. The forecasted growth in air cargo volumes is expected to reach 3.6-3.7 million tonnes, driven by a robust expansion in international cargo volumes (11%-13%) and a steady increase in domestic cargo (4%-6%) (ICRA, 2024).

A key factor contributing to this rise is the ongoing geopolitical situation, particularly the Red Sea crisis that began in October 2023. This conflict has disrupted seaborne cargo traffic, creating opportunities for air cargo to fill the gap. International air cargo volumes have surged by 18% in the second half of FY2024, with further growth expected as the situation continues to evolve.

In addition, the recovery from the pandemic has been swift for air cargo. While passenger traffic took longer to rebound, cargo volumes have already recovered to 95% of pre-COVID levels by FY2022, with international cargo benefiting from increased exports, including COVID-related vaccines. The air cargo industry is expected to continue benefiting from such disruptions, contributing to significant growth in FY2025.

According to a recent Dimerco report, India’s air freight rates have remained stable but are expected to rise due to the Christmas rush. Shippers are urged to plan shipments in advance to avoid delays as the holiday period approaches.

“2025 will see focus on refining the fundamentals such as enhancing the omni-channel experience to blur the lines between online and offline commerce.”
Shashwat Swaroop, Marmeto

The outlook for airport operators also remains stable, with revenues expected to grow by 12-14% YoY in FY2025. This growth is driven by a sustained increase in both domestic and international passenger traffic, coupled with rising tariffs and the ramp-up in non-aeronautical revenues at major airports. The credit profile of airport operators is expected to remain strong, supported by healthy profitability margins and comfortable liquidity, despite higher interest expenses from ongoing capital expenditures, as stated in a report by ICRA.