Consider a freight train travelling nearly 1,500 km from Dadri, Uttar Pradesh, to Jawaharlal Nehru Port Authority (JNPA), Navi Mumbai, at speeds approaching 100 kmph and carrying significantly heavier cargo loads without the delays historically associated with India’s rail network. What once appeared aspirational is steadily becoming operational reality.
Railway is beginning to change the economics of freight movement in India in a way road transport never fully could. According to a joint assessment by the National Council of Applied Economic Research and the Department for Promotion of Industry and Internal Trade, rail logistics operates at an average cost of ₹1.96 per tonne-km, making it one of the most cost-efficient modes.
Air freight — though the fastest — costs around ₹72 per tonne-km, limiting its use to high-value, time-sensitive cargo. This creates a clear middle ground, where rail-led corridors, such as the dedicated freight corridors (DFC), start to matter. On trunk routes like Dadri-JNPA, the cost advantage compounds at scale, especially for bulk and containerised movement.
For businesses, this is a structural shift that will increasingly determine where they locate, how they distribute and how efficiently they serve markets.
Warehousing clusters
The near completion of the Western Dedicated Freight Corridor is already influencing decisions on industrial location. Logistics developers, manufacturers and third-party logistics providers are reassessing their distribution networks and prioritising locations along emerging freight corridors.
Industry indicators reflect this realignment. Warehouse leasing touched a record 72.5 million sq ft in 2025, up 29 per cent year-on-year.
Distribution hubs located along freight corridors enable companies to optimise cargo movement, reduce transportation costs and strengthen connectivity between ports, manufacturing clusters and consumption markets.
There is a visible shift away from fragmented, city-led warehousing networks towards fewer, larger and strategically located logistics hubs aligned with freight infrastructure. Over time, such logistics nodes are expected to catalyse the development of integrated industrial corridors that combine logistics parks, manufacturing facilities and distribution infrastructure. This evolution reflects a deeper realignment of supply chains towards scale, efficiency and network optimisation.
Redoing supply chains
Enhanced freight connectivity is also prompting companies to rethink the architecture of their supply chains. In the coming years, many firms are expected to transition from fragmented warehouse networks toward consolidated distribution hubs aligned with freight infrastructure. This means a move towards hub-and-spoke models backed by high-efficiency, corridor-linked nodes and agile last-mile networks.
Government initiatives such as the PM Gati Shakti National Master Plan are strengthening this structural shift. By integrating railways, highways, ports and logistics infrastructure within a unified planning framework, the programme seeks to create seamless multimodal freight corridors across the country.
For manufacturers, stronger connectivity between freight corridors and ports offers improved access to export gateways and domestic markets. Similarly, retailers and e-commerce operators are likely to utilise corridor-linked logistics hubs as primary distribution centres to service regional demand clusters.
As freight corridors mature, they will compress turnaround times, improve reliability and bring a level of efficiency that aligns India more closely with global manufacturing hubs. Faster movement, predictable timelines and integrated infrastructure will allow businesses to operate at scale without the friction that has historically held them back.
Neeraj Balani, Chief Customer Officer, Welspun One
(The writer is Chief Customer Officer, Welspun One)
Published on May 18, 2026