Hong Kong-based Kerry Logistics entered into a memorandum of understanding to raise its stake in Chennai-based Indev Logistics Pvt. Ltd. from 30 percent to 50 percent, as it prepares to handle increased demand for logistics services from growth in ecommerce and industry, driven, in part, by the Indian government’s new “Make in India” program. With a 50 percent stake, Kerry will be able to rebrand the Indian logistics provider as Kerry-Indev Logistics.
Kerry cited “an increasingly positive view of India’s economic prospects,” as the key rationale behind the decision to increase its stake in Indev. George Yeo, chairman of Kerry Logistics, said that he believes the country’s new “goods and services” tax plan and its focus on industrial development via Make in India in the coming years, bode well for the logistics industry.
Make in India is an initiative of India’s Department of Industrial Policy and Promotion, which aims to facilitate the process of doing business in India and attract foreign direct investment (FDI). The program includes a wide range of investment incentives, raises caps on FDI and streamlines many bureaucratic processes into a simplified online portal. Kerry’s Yeo said the Make in India campaign is “very positive for the quantitative and qualitative expansion of the logistics industry.”
Meanwhile, Indev has been rapidly expanding its warehousing and 4PL logistics capabilities to prepare for increased e-commerce demand. Local media reports Indev will have close to 465,000 square meters of warehousing space by 2018, with significantly enhanced cold-storage capabilities. Plans are also in place to introduce last-mile delivery and express services to accommodate growing e-commerce demand.
In the past year, Kerry Logistics made clear its ambitions to fortify its global network with significant acquisitions in Canada, the United States and Dubai.
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