India has been witnessing a remarkable surge in warehousing demand across key sectors, with figures rising from 15% in 2019 to 25% in 2024. This increase is primarily fueled by favorable government initiatives and a global strategy to diversify supply chains away from China. Cities like Pune, Delhi-NCR, and Kolkata are emerging as key beneficiaries of this growth, further bolstering India’s manufacturing sector, which employs over 27 million people.
So, what’s driving this surge in warehousing demand? According to a recent report, the demand for warehousing in sectors such as engineering, electronics, and auto manufacturing has seen a significant increase. This shift is mainly attributed to government policies like the Production Linked Incentive (PLI) scheme and the ‘China + 1’ strategy adopted by many global businesses.
Total warehousing leasing from these sectors reached an impressive 4.1 million sq. ft. in the first half of 2024, with cities like Pune, Delhi-NCR, and Kolkata leading the demand surge. Pune’s share of total demand grew from 6% in 2019 to 13% in 2024, while Delhi-NCR and Kolkata also witnessed significant increases in warehousing demand.
India’s engineering and manufacturing sectors have leased 11% of the total warehouse space in 2024, up from 8% in 2023. Domains like domestic appliances, auto components, and the automobile industry are driving this growth as production and distribution needs continue to rise.
Manufacturing is a critical pillar of India’s economic growth, contributing approximately 14% to the GDP and employing over 27 million people. With key government initiatives like the GatiShakti National Master Plan, National Logistics Policy, corporate tax cuts, and GST reforms, India is set for a significant transformation in its manufacturing sector.
India’s strong industrial infrastructure plays a pivotal role in supporting the growth of its manufacturing sector, simplifying the ease of doing business and encouraging collaboration and productivity. Additionally, the country’s focus on expanding trade agreements is presenting substantial opportunities for its manufacturing sector to capture a larger portion of the global market.
In conclusion, India’s warehousing demand is on the rise, supported by favorable government policies and a shift in global supply chains. With cities like Pune, Delhi-NCR, and Kolkata at the forefront, India is well-positioned to enhance its global manufacturing and warehousing footprint in the coming years.
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