Nagpur as a Logistics Hub

Nagpur popularly known, as Orange city of India is also known as the second capital of Maharashtra. It is the third largest city by population, of Maharashtra. The city is located in the north eastern part of Maharashtra and India’s geometrical center, the “ZERO MILE” lies within the city. This makes the city easily accessible by Road, Rail & Air.
Nagpur is also the center of the historic Vidarbha region. It has excellent infrastructure in terms of roads, power supply, water supply system and Telecommunication network. Nagpur has remarkable advantages and can offer numerous development opportunities for companies in the logistics sector. The city has an extremely favorable geographical location. Nagpur also happens to be at the crossing of most of the international air routes this makes it a logical and ideal place for an international hub airport, which could be supported with the road and rail infrastructure already in place.
Major highways NH-6 (Hajira-Kolkata), NH-7(Varanasi-Kanyakumari) and NH-69 (Nagpur-Obaidullagunj) and major railway trunk routes (Mumbai, Chennai, Howrah, Delhi) pass through the city. Nagpur is:
837 kms – East of Mumbai
1094 kms – South of Delhi
1092 kms – North of Chennai
1140 kms – West of Kolkata.
Nagpur Airport has a strategic location on the International Aviation Route and is emerging fast as a transit hub with a projected Passenger Traffic of 15 Million and Cargo Traffic of 1 Million Tonnes per year.
Looking at the strategic advantage of Nagpur Govt. of Maharashtra in the year 2002 constituted Maharashtra Airport Development Company Limited (MADC) as a Special Purpose Company. MADC has been formed to play a lead role in the planning and implementation of the MIHAN project. The Government of Maharashtra has taken the initiative of setting up a world class Multi-modal International Hub Airport at Nagpur (MIHAN) which will be integrated with Rail and Road terminal. This will provide an excellent Multi-modal transport system for Passengers and Cargo.
In future with elimination of central sales tax (CST) and implementation of the Goods & Service Tax (GST), most companies would prefer to consolidate number of warehouses in India. Major industries like apparels, third-party logistics, consumer durables and auto spares would want to set up national distribution center (NDC) close to India’s geometric center for serving entire India. Other industries like retail, FMCG and pharmaceutical will have demand for regional distribution centre (RDC) to serve local markets. Nagpur becomes obvious choice for serving local markets or entire India due to its strategic location. This would lead to growing logistics activity in Nagpur and the city will emerge as the country’s most important logistics centre.
Nagpur’s reach can be easily explained in the image below. Due to its centralized location, any products can be distributed across India in less than 4 days by road. If Air & Rail transport is used, the transit time reduces considerably.

Note: The hours duration mentioned in the image is maximum time taken for delivery by road transport to the major cities across India after confirmation of an order.

1) Nagpur’s importance as a logistics hub has also been highlighted in many news articles, some of them are:

Move to make Nagpur a multi-modal logistics hub

Reference: “THE HINDU” – 25th May 2015

The logistics sector is being given a leg up to support the sudden growth in e-commerce as well as the government’s Make in India initiative.
The Maharashtra Government, which is taking a lead in thisp initiative, has lined up plans to expedite an earlier programme to develop Nagpur, the central point of India, as a multi-modal logistics hub. The state government has also decided to set up an integrated logistics park near Mumbai.
“To support the Make in India’ initiative, we are coming up with an integrated logistic park at Bhiwandi, near Mumbai, on 2200 hectors of land. The plan is ready, and soon a state-of-the-art facility will come up to give a boost to the logistics sector,” Maharashtra Chief Minister Devendra Fadnavis said while addressing a three-day convention of Federation of Freight Forwarders’ Associations in India (FFFAI) here.

“Nagpur is being developed as a multi-modal logistics hub as it is located at the centre of India. Aurangabad has also equal potential to emerge as a hub to cater to the requirement of e-commerce firms. Maharashtra is poised to play a vital role for the logistics sector, which will benefit the whole freight forwarding community,” he added. Addressing the conference Guruprasad Mohapatra, Joint Secretary, Ministry of Commerce, said new routes must be developed for CIS countries which had emerged as major trade partners of India.
Bilateral trade
“The bilateral trade between India and CIS region has increased from $8,346 million in 2010-11 to $11,054.million in 2014-15. FFFAI on behalf of Ministry of Commerce had conducted a successful dry run study on International North South Transport Corridor (INSTC). The activation of the corridor will help reduce dwell time and transaction costs by connecting India to Russia within 16-21 days at competitive freight rates leading to development of trade in the INSTC,” he said.
As India embarks on a massive manufacturing activity and is developing dedicated freight corroders as well as giving boost to inland waterways and coastal shipping, the freight forwarders, an important stakeholder in logistics industry, are gearing up to seize the opportunity.
“FFFAI is working actively to provide the requisite mindset, skill, technological roadmap and develop execution ability to handle the next growth curve in economy. This will help in reduction of transaction cost and provide efficient movement for manufactured products within & outside country,” said Amit Kamat, Honorary Secretary, FFFAI Convention.

2) Boeing, Amazon explore investing in multi-modal cargo hub at Nagpur

Reference: “The Hindu Business Line” – 20th January 2015

The Multi-modal International Cargo Hub and Airport at Nagpur (MIHAN) is finally getting a fresh push from Maharashtra Chief Minister Devendra Fadnavis.
At least five companies, including a US-based IT company, have committed to invest in excess of $500 million to set up campuses at the site, if they get the land parcel in a non-SEZ area on an outright allotment basis.
A senior Maharashtra Government official said that the Chief Minister had met executives from the IT company on December 16.They had also toured the MIHAN site along with a delegation led by Thomas Vajda, Consul General of US in Mumbai. Vajda was accompanied by senior executives of companies such as Corning India, APCO Worldwide, Jabil Circuit, Boeing,, Honeywell International and Colgate-Palmolive.

Allocation Request
The official said that Maharashtra Airport Development Company Ltd (MADC) is considering the allocation request. “They were satisfied with the various infrastructure facilities provided at the site. However, we have not yet signed any agreement,” the official said when asked to divulge further details about their plans in MIHAN.

The official said that Fadnavis has assured the delegates that the State government will expedite decisions and create industry friendly environment for the companies in MIHAN.

The Chief Minister also delineated steps taken by his Government for the Make in India campaign. Indian IT major such as Infosys, Tech Mahindra, HCL Technologies, Wipro Technologies, Tata Consultancy Services (TCS) and Hexaware Technologies have already taken up land for setting up campuses.

Earliest tenant
In fact, the earliest tenant of MIHAN was Satyam Computers, which had managed to acquire 128 acres around the 100 acre Telhara lake, a local water body. The site has now been transferred to Tech Mahindra as a part of the Satyam acquisition.

TCS has a 54-acre property in the MIHAN SEZ and is setting up a software development campus with an investment of ₹600 crore.

Over the last 10 years, the State government, through the Maharashtra Airport Development Company Ltd (MADC), has been trying to develop MIHAN project, spread over 4,000 hectares. MIHAN is located about 15 km from downtown Nagpur.

3)Nagpur to emerge as key logistics hub

Reference: “The Hindu Business Line” – 20th January 2015

Nagpur has suddenly shot into limelight. The city is to emerge as the country’s one of the important logistics centres. Thus, Nagpur airport is to become the country’s first national air cargo hub, the civil aviation minister has been quoted as saying. Business sops, tax incentives would be given to attract freight companies, courier companies, both national and international, and airlines and allied service providers to set up their outfits there. Maharashtra Airport Development Co has selected a Sical-led consortium to set up a rail terminal as part of the proposed air cargo hub in the city. The rail terminal will be built on a build-operate-transfer (BOT) basis, on a 24-hectare plot on lease for 66 years. The facilities will comprise a container freight station with rail siding and handling infrastructure for export/import as well as domestic traffic, both bulk and containerised types. The terminal is expected to become operational by the first quarter of 2008-09. It is felt that the air cargo hub projects and related infrastructure such as rail terminal will add new dimensions to the logistics chains of business not only in Maharashtra but also across India.

4)Develop Nagpur as Logistics Hub

Reference: “The Hitwada” – February’ 2013

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