Smart Warehousing Readies India for Global Distribution

In the crucible of global commerce, where efficiency and resilience dictate a nation's competitive edge, India is crafting a new identity. Previously characterised by fragmented and unorganised operations, the warehousing sector is undergoing a significant transformation. This is not merely growth; it signifies a carefully orchestrated advancement, driven by a national economy that demands precision and reliability. Dr Aditya Gupta, COO, Transport Corporation of India- Indian Institute of Management Bangalore (TCI-IIMB) Supply Chain Sustainability Lab, notes, "Smart warehousing has the potential to transform India's supply chains by moving from labour-intensive operations to technology-driven efficiency."

Anshul Singhal, Managing Director, Welspun One and a long-time observer of this growing sector observes that the narrative has shifted away from incremental gains to a fundamental realignment of infrastructure and strategy. He believes the most significant strategic trend is the inexorable gravitation toward institutional-grade warehousing. Chandranath Dey, the Operations Manager for Business Development, Industrial Consulting, and Integrated Logistics at JLL India, agrees that the biggest trend is the "big move from Grade B to institutional Grade A warehousing," which is driven by the need for larger spaces and better quality.

Grade A Facilities Revolution

Grade A facilities are rapidly adopted due to their relentless pursuit of operational excellence. Dey says these modern facilities have FM Global II-compliant super-flat floors, 12-metre-plus clear heights, and advanced racking systems. These specifications are essential for businesses to maximise storage density, improve material handling efficiency, and seamlessly relocate automated equipment. Better fire safety systems protect goods and lower insurance costs, making these high-quality warehouses more attractive to businesses.

Infrastructure Expansion

Logistics in the subcontinent is undergoing significant changes as Tier 2 and Tier 3 cities emerge as key hubs. Evolving consumer demands and the need for last-mile efficiency necessitate geographic expansion and a strategic redistribution of infrastructure. Dey highlights that the top 12 Tier 2 and Tier 3 cities boast 95 million square feet of warehousing space, which is four times greater than in 2017. In the fiscal year 2023-24, 60% of e-commerce transactions originated from these cities, reflecting a notable shift in demand.

The Government's Pivotal Role

The physical, digital, and political dimensions of logistics are all undergoing substantial changes. The Prime Minister's Gati Shakti initiative and the National Logistics Policy (NLP) exemplify the government's proactive approach to systemic reform. By establishing a multimodal infrastructure pipeline, the NLP aims to reduce global logistics costs to 8% of GDP by 2030. Additionally, Prime Minister Gati Shakti is advocating for the establishment of multi-modal logistics parks in key states.

Robust Institutional Backing

Institutional investment is growing in the sector's capital structure, indicating maturity. Dey reports "unprecedented institutional investment growth post-Covid, almost doubling from 5.4 USD billion in 2019 to 8.9 USD billion in 2024. Domestic and international investors believe India's logistics story has long-term potential, resulting in this capital surge. The strategic alignment of private capital with government policy and infrastructure development is creating a virtuous cycle of investment and growth."

Technology: The Key Frontier

Emerging technologies, such as AI and automation, are revolutionising the warehouse industry. Sangeet Kumar, CEO & Co-Founder, Addverb Technologies, states that "AI-driven orchestration software, goods-to-people picking systems, and shuttle-based ASRS are the most effective solutions." These innovations enhance warehouse speed, accuracy, scalability, and space utilisation. He asserts that "automation serves a dual purpose: it enhances resilience to manage unpredictable demand cycles and reduces dependency on fluctuating labour availability."

Complete automation is difficult. Dr Gupta warns that widespread adoption is unlikely because labour costs are lower than advanced automation. He claims that AI, IoT, and automation-enabled smart warehouses can improve supply chain efficiency, lead times, and scalability. Automation in India requires balancing initial capital investments, long-term operational savings, and labour market dynamics. However, innovative companies are investing in technologies that offer a clear ROI and address specific operational challenges.

Singhal stresses the need for digital integration across the ecosystem, from approvals to cargo movements. Bridging this gap could boost transparency and efficiency. AI-driven predictive analytics will change supply chain planning and operations, he believes. The industry expects this shift from reactive to predictive logistics to elevate warehouse and supply chain efficiency to unprecedented levels.

A Sustainable and Talent-Driven Future

The future of the sector lies in smart, resilient, and long-lasting supply chains that go beyond the idea of just better warehouses. More and more new ideas show how important it is to switch to ESG principles. More rules and regulations, as well as a greater awareness among tenants about their carbon footprint and operational costs, are driving this change. The area set aside for green and sustainable practices in warehouses is expected to grow significantly.

Dey asserts that "ESG is no longer a desirable asset; it is a necessity for businesses." Both tenants and investors are increasingly interested in green warehouses. Singhal observes that "ESG reduces tenants' operating costs by minimising energy and water use," assisting them in meeting global standards. This shift demonstrates that sustainability has become a business requirement.

Need Talent Pool to Leverage Technology

A further defining challenge and opportunity is human capital. Dr Gupta asserts that the genuine success of automation is contingent upon the talent that oversees it. He underscores that automation success is contingent upon the presence of talent with cross-disciplinary skills, such as "expertise in supply chain, analytics, AI/ML, IoT integration, robotics, and sustainability." Technology alone won't shape the future of logistics; it's the skilled professionals who will leverage these innovations to create value.

The ultimate goal for India's warehousing sector in the upcoming decade is to establish a sustainable, integrated, multimodal ecosystem that is fuelled by technology and talent. Dey asserts that the most critical trend for India's logistics sector will be the transition from fragmented logistics to integrated multimodal infrastructure in Tier 1, 2, and 3 cities. India is committed to becoming the world's most comprehensive and efficient logistics hub by dismantling the silos between different modes of transport and creating a truly integrated supply chain.

Q&A with Anshul Singhal

The logistics landscape is no longer just about infrastructure; it's about strategic innovation. Anshul Singhal, a pivotal figure at the helm of Welspun One, has been at the vanguard of this industry's transformation. In a candid dialogue with India Front, he unearths the pioneering solutions his firm has championed, from architecting specialised warehousing formats to advocating for crucial policy reforms that will futureproof the sector.

What is a specific and significant innovation that Welspun One has pioneered in the field of warehousing? What tangible benefits has it delivered?

Welspun One has redefined warehousing by creating a portfolio of specialised product categories. We use Proxima for large e-commerce facilities, Pulse for in-city mixed-use logistics, and Gateway for port-based hubs. Each format addresses India's diversified supply chain needs across consumption, urban density, and trade. Proxima delivers speed and scale for e-commerce. For instance, at our Proxima Park in Bhiwandi, Delhi's largest sorting centre, 60,000 packages are processed per hour. Together, these projects demonstrate how Welspun One is building fit-for-purpose infrastructure that doesn't just store goods but actively delivers efficiency, speed, and reliability to India's supply chains.

From your perspective, what are the most critical and often-overlooked gaps in India's logistics infrastructure that continue to hinder its potential to become a global hub?

India has made major advances with initiatives like Gati Shakti and the National Logistics Policy, and we are witnessing the development of stronger highways, dedicated freight corridors, and new multimodal projects. However, the next leap lies in addressing softer, yet equally critical, aspects. For example, our warehousing stock remains fragmented, with varying levels of quality. A national push towards the standardisation of Grade-A specifications, encompassing compliance, safety, and sustainability, will ensure consistency and attract more institutional investment. If India can address these overlooked areas, it will not only possess world-class infrastructure but also a logistics backbone that is globally benchmarked, predictable, and conducive to investment.

How is Welspun One developing next-generation solutions to address challenges such as urban congestion and last-mile delivery, especially considering the growth of e-commerce?

We are adopting a multi-nodal approach by developing not only large-format parks but also in-city and port-based facilities that position inventory closer to consumption. By collaborating with tenants to create design-ready, tech-enabled hubs, we facilitate faster fulfilment and alleviate transport bottlenecks. Our upcoming WTC Thane project exemplifies how urban logistics can reduce delivery times, lower emissions, and support sectors such as groceries and e-pharma, as it will be designed to handle the demands of rapid urban commerce.

If you were to propose a key policy reform to the government aimed at accelerating India's supply chain growth, what would it be and why?

Standardising modern in-city warehousing norms is essential, encompassing higher permissible building heights for multi-storey formats, clear fire and life safety standards, and harmonised guidelines for the storage of hazardous goods. This reform would position India's warehousing sector at a global benchmark, ensuring it is ready for environmental, safety, and operational challenges.

What type of talent is Welspun One currently looking for, and what initiatives are being implemented to address the skills gap in a sector that is increasingly driven by technology?

We are seeking multi-skilled professionals, people who can combine traditional expertise in project delivery, engineering, and leasing with emerging capabilities in data, automation, and sustainability. To bridge the skills gap, we are building cross-functional teams, investing in continuous training, and partnering with academia to shape the next generation of logistics professionals. We have institutionalised WeLearn, our in-house capability platform with 1,000+ curated courses, providing employees with access to cutting-edge learning resources that prepare them for the evolving demands of the logistics sector.

What specific strategic advantages does Welspun One provide that make India's supply chain more attractive and reliable for international companies seeking a credible alternative to traditional manufacturing hubs?

Our institutional-grade governance, compliance-first approach, and long-term capital base make us a partner global companies can trust. Along with our data-driven approach to choosing markets and our capability to create customised, technology-ready facilities, we offer the size, clarity, and reliability that global companies seek when they want to move away from traditional manufacturing locations. We were also the first and largest domestic Alternative Investment Fund (AIF) focused on logistics. Additionally, we are the only Indian developer to hold two World Trade Centre (WTC) licences for logistics assets. This global recognition, embedded into our Thane Pulse and Nhava Sheva Gateway projects, gives international companies direct access to a globally connected ecosystem of trade and credibility.

Solutions Spotlight

•Design Warehouses as Value-Added Hubs: Consider multi-storey urban warehouses to navigate land shortages. Incorporate layouts designed for automation; seamlessly integrate renewable energy from the outset.
•AI-Driven Predictive Analytics: Optimise routes and forecast demand with AI-driven predictive analytics. Digitise the entire ecosystem—from government approvals to cargo movements.
•Policy Advocacy: Become an active advocate for policy enhancements and the standardisation of Grade-A specifications across the industry.