Warehousing demand growing in Tamil Nadu

Demand for warehousing infrastructure in Chennai has doubled in the past three years. The logistics industry is seeing a rising demand for modern warehousing space in Tamil Nadu, due to increased industrial activity, and favourable policies related to GST, says S Narasimhan, MD Sattva Logistics, and chairman, CII Task Force on Ports (southern Region).

The southern state has been witnessing better ports-to-road connectivity with access to the hinterlands which has made Chennai a hub of warehousing. “Apart from regular imports, there is an increase of imports like raw materials, which are generating demand for warehousing spaces,” said Narasimhan.

Shri Kailash Logistics Chairman S Rajkumar said that the city’s outskirts have potential to be developed into a logistics hub in the Chennai- Bengaluru Industrial Corridor. He said that after the GST regime, there is a demand for warehousing in Tier- 2 cities like Madurai, Salem, etc.

“The single tax system made it easier for the firms to have large warehouses in hubs. The FMCG firms are showing interest in reaching Tier -2 cities from where they can access 6- 7 smaller cities,” he said. Industry insiders said while there is a rise in demand for e-commerce services in south districts, firms aren’t able to meet them due to a shortage of warehouses.