DHL Supply Chain (DHL) is investing €500 million (US$499 million) in India over the next five years to significantly grow its warehousing capacity and boost its sustainability initiatives in the country.
With this investment, DHL will own and operate wholly-owned large multi-client sites in India, adding twelve million square feet of warehousing space to the group's existing portfolio.
"The increased warehousing capacity is targeted to effectively cater to growing sectors such as e-commerce, retail, consumer, life sciences, technology, engineering and manufacturing as well as automotive," the logistics company said, adding that the warehouses will be equipped with digital technology solutions including assisted picking robots, indoor robotic transport, intelligent process automation, wearable devices, voice picking, inventory management robots and algorithmic optimizations.
Growth potential in the Asia Pacific
Image: DHL Supply Chain
"Despite the current, economic and geopolitical uncertainties in the world, we see enormous growth potential in the Asia Pacific region, with India making a significant contribution," said Oscar de Bok, CEO, DHL Supply Chain, citing India's stable and fast-growing economy, investment-friendly environment, and a rich pool full of talents — making the country one of DHL's "priority markets" and a "favourite hub" for its global contract logistics business.
With the investment, DHL Supply Chain India will add twelve million square feet of capacity in wholly-owned DHL multi-client sites in key metro cities such as Bangalore, Chennai, Kolkata, Mumbai, National Capital Region (NCR) and Pune.
Multi-client sites are also being built in Ambala, Baddi, Cochin, Coimbatore, Guwahati, Sanand, Hyderabad, Jaipur, Indore, Lucknow, Bhubaneshwar, Hosur, and Visakhapatnam.
DHL Supply Chain currently offers the full suite of transport solutions including Full Truck Load (FTL), Part Truck Load (PTL), "milk runs", secondary transport, and intra-city and inter-city air movements.
"The Asia Pacific currently accounts for about 15% of DHL Supply Chain's global revenue but is among the fastest growing regions, with India being a key contributor to this growth," said Terry Ryan, CEO, of DHL Supply Chain Asia Pacific.
Logistics market growth in India
Ryan noted that the Indian logistics market, worth over US$200 billion now, is expected to grow at about 10% per year in the next five years to reach around US$330 billion.
"We take a long-term view in India with businesses here having reasons to be optimistic," he added.
DHL also noted that in recent years, the Indian government has increased efforts to improve the country's logistics performance, boost trade and safeguard foreign investment — in particular, expenditure on logistics is expected to reach USD$500 billion annually by 2025.
A logistics division was also recently established to introduce positive changes to existing procedures and bring related technology and innovation to maximize efficiency.
"Building up large multi-client sites with efficient end-to-end transport solutions along with value-added services run by highly-skilled employees allows us to maximize operational efficiency and puts us in a strong position to scale according to what our customers need, across various sectors," said Vikas Anand, managing director, DHL Supply Chain India Pvt. Ltd.