India is on the cusp of a logistics revolution: DP World

Dubai-based terminal operator DP World’s CEO and managing director for the subcontinent region , Rizwan Soomar, believes India is on the cusp of a logistics revolution. In an interview with Fortune India, he spoke about how an efficient logistics network will help India sustain huge growth going forward and how DP World is looking to play a role in it. Edited excerpts from the interview:

Lately, there has been a lot of activity from DP World in terms of investment. What major opportunity do you see in India?

The major opportunity we see here is the interaction with the end customer, which is the exporter and importer, demand aggregator—essentially who has to move the cargo inland to the ports through various modes of transportation and vendors. Here there are many challenges and pain points. There are many handovers in that sense.

Now, this is what the government is also trying to do, which is promoting ease of doing business. One of the main enablers of ease of doing business is to make it easier for the customers to move the cargo within and out of India.

DP World has signed a joint venture (JV) with the National Investment and Infrastructure Fund (NIIF) to develop the ports, transportation and logistics sector in India. Can you share with us how do you plan to invest the $3 billion corpus?

DP World has been a part of India’s growth story for nearly two decades and we are delighted to continue our success by collaborating with NIIF. The platform will invest up to $3 billion of equity to acquire assets and develop projects in the sector. It will also look at opportunities beyond seaports such as riverports and transportation, freight corridors, port-led special economic zones, inland container terminals, and logistics infrastructure including cold chain storage.

We are looking at a number of opportunities in India and are in various stages of discussion. We are proud to share our expertise and experience in these (above-mentioned) areas and the global supply chain to provide cost effective logistics and warehousing solutions for India's growing export and import trade.

What was the reason for partnering with the NIIF?

We think India is on the cusp of a logistics revolution. Why I say this is that we already have a very large manufacturing, exporting and importing base. Because of Make in India and finding new markets in the last few years, we will be able to sustain huge growth going forward, and for this we need an efficient logistics supply chain. We are underrepresented in terms of infrastructure where logistics is concerned. There are many pain points in the supply chain which can be removed through an efficient and world-class infrastructure. So, we see a lot of opportunities, but you need to partner with the government—hence, the NIIF partnership.

What future do you see for the logistics sector in India?

This is an exciting period for us to be playing an integral part in the country’s growth. The government of India under Prime Minister Narendra Modi has launched a number of major initiatives such as the Sagarmala, Bharatmala, ports modernisation and inland waterways which have the potential to make India an “engine of growth”. We are confident that the next few years will see India developing a stronger, integrated logistics supply chain including dedicated freight corridors, multimodal logistics parks, and industrial corridors. This will make the sector more attractive and reduce the cost of logistics by eliminating inefficiencies and bottlenecks in the supply chain.