India's warehousing demand rises to 25 pc in H124: CBRE report
Sep 27, 2024
New Delhi [India], September 27 : The demand for warehousing in India from sectors like engineering, electronics, and auto manufacturing has grown from 15 per cent in 2019 to 25 per cent in the first half of 2024, according to a CBRE report.
This rise is largely attributed to favourable government policies like the Production Linked Incentive (PLI) scheme, which covers 14 sectors, and the global shift towards the "China + 1" strategy, where manufacturers diversify supply chains away from China.
The total warehousing leasing from these sectors reached an impressive 4.1 million sq. ft. in the first half of 2024.
Among the cities benefiting most from this growth, Pune has seen the highest increase in demand, with its share rising from 6 per cent in 2019 to 13 per cent in the first half of 2024. Delhi-NCR and Kolkata have also experienced significant increases, with warehousing demand hitting 18 per cent and 12 per cent, respectively.
India's engineering and manufacturing sectors have contributed to 11 per cent of the total warehousing leasing in the first half of 2024, up from 8 per cent in 2023.
Key contributors to this increase include domestic appliances, auto components, and the automobile industry, all have shown robust demand.
India's manufacturing sector plays a crucial role in the country's economic development, contributing 14 per cent of the nation's GDP and employing over 27 million people.
Anshuman Magazine, Chairman & CEO, India, Southeast Asia, Middle East & Africa, CBRE, said, "India's manufacturing sector is on the cusp of a transformative journey, attracting significant interest on the global stage."
He added, "Continued economic development in both leading and emerging Asia Pacific markets will boost consumer demand for manufactured goods and further fuel the growth of the region's manufacturing sector."
Programs like the GatiShakti National Master Plan aim to streamline supply chains, while the National Logistics Policy promotes sustainable and cost-effective transport modes.
Other government efforts include corporate tax cuts, Goods and Services Tax (GST) reforms, and R&D tax benefits, all of which contribute to India's competitive edge on the global stage.
Rami Kaushal, Managing Director, Consulting & Valuation Services, India, Middle East & Africa, CBRE, said, "India's robust industrial infrastructure has been crucial in driving its manufacturing sector forward. It emphasises the nation's appeal for ease of business, encourages collaboration, and enhances productivity."
Ram Chandnani, Managing Director, Advisory & Transactions Services, CBRE India, said, "India's focus on trade agreements holds immense potential for its manufacturing sector and will act as a trade catalyst. This presents a golden opportunity for India's manufacturers to diversify from the dominance of the services sector and capture a larger share of the global manufacturing pie."
