Warehousing sector to see investment of Rs 43,000 cr, to create 2 lakh jobs by 2020: JLL
The warehousing sector will attract investments of about Rs 43,000 crore and create 2 lakh job opportunities in the next three years, driven by GST implementation and growth of the e-commerce sector, according to property consultant JLL India
New Delhi: The warehousing sector will attract investments of about Rs 43,000 crore and create 2 lakh job opportunities in the next three years, driven by GST implementation and growth of the e-commerce sector, according to property consultant JLL India. In its report, JLL estimated that the amount will be invested in creating warehousing facilities across India from 2018-2020. Warehousing stock is expected to rise to 247 million sq ft by 2020 from 140 million sq ft in 2017.
"In these three years, different categories of warehousing will also create jobs to the tune of 2,00,000 at different levels of specification and specialisation," the report said. The consultant attributed the implementation of GST and the rapid growth of e-commerce as two important factors that have created a significant growth prospects in warehousing sector.
"Warehouse and logistics is one of the biggest growth areas that has emerged in recent times. We have seen Rs 1,25,000 crore invested through private equity in warehousing space since 2014. While it made up about 10 percent of total PE investment in 2017, the share is expected to grow claiming larger share of investment," JLL India CEO and Country Head Ramesh Nair said. The report said that the prime beneficiaries of the new wave of growth in warehousing will be the peripheral locations of tier 1 and tier 2 cities. This investment comes at the back of the fact that nearly Rs 10,000 crore was invested in 2017.
Of all the categories, warehousing will be witnessing the highest investment of over Rs 35,000 crore in the next 3 years, mostly in creating storage facilities for retail and consumer goods. The cold storage and agricultural warehousing would see about Rs 7,500 crore investment. Container storage would be attracting approximately INR 500 CR in the same period mostly to boost India's logistical prowess.
JLL said that the overall growth in e-commerce and a shortening turnaround time for delivery has necessitated a sharp growth in warehousing in the country. Apart from E-Commerce, the next big sector of space are the electronic and white goods that command significant warehousing spaces in urban and semi – urban locations.
"It is estimated that Grade A and B warehousing stock will grow at a CAGR of 21 percent year–on–year taking the total tally of warehouse space in India to 247 million sq ft by the end of 2020 almost doubling the current warehousing stock of 139.8 million sq ft in 2017," the report said.
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