India Route Optimization Software Market Size, Share, Opportunities, COVID-19 Impact, And Trends By Product (Software, Services), By Application (Food Delivery, Ride Hailing Services, E-Commerce, Others) - Forecasts From 2022 To 2027

The India route optimization software market is evaluated at US$33.840 million for the year 2020, growing at a CAGR of 13.56% reaching the market size of US$82.422 million by the year 2027.

Route optimization software is a kind of software used to find the quickest and most cost-friendly route among several available routes. The optimized route is concluded based upon metrics like the number of stop locations and time taken for each delivery spot between the start and end of the route. The Indian market for route optimization is projected to witness exponential growth, majorly owing to the large e-commerce growth in the country because of increased internet and smartphone penetration. Also, government policies on logistics and warehouses are further anticipated to drive the market growth of the route optimization software market in India. Also, major investments in the e-commerce and logistics sectors are prominent factors in propelling the overall growth of the route optimization software market in India during the forecast period. However, a lack of proper internet infrastructure and a projected increase in digital skills demand may restrain the route optimization software market in India during the forecast period. India's Route Optimization Software market, 2020 to 2027

The COVID-19 impact on the Indian route optimization software market has been negative. With a massive population and exponential growth in coronavirus infections, the lockdowns and restrictions led to a decline in logistics and transportation all over the country. Also, with the global supply chain disruptions, the domestic logistics market was affected, thereby leading to a decline in the route optimization software market in India.

E-commerce growth, government policies on logistics and warehouses

The increased digital literacy and awareness, along with internet and smartphone penetration in India, has led to the promising growth of the e-commerce segment in India, which is anticipated to propel the future growth of the route optimization software market because of increasing e-commerce transactions and delivery demands. According to the April 2022 article by the Indian Brand Equity Foundation (IBEF), the e-commerce market growth in India is projected to grow from USD 46.2 billion in 2020 to USD 188 billion by 2025, which is further expected to reach a value of USD 350 billion by 2030. Also, the same source stated that 100% Foreign Direct Investment (FDI) is allowed in India for B2B e-commerce. Also, rising e-commerce start-ups in India are projected to push the growth of the route optimization market in India for faster and more cost-effective deliveries of orders.  For example, in February 2022, Xpressbees, an Indian e-commerce start-up, became a unicorn with a valuation of USD 1.2 billion, as stated on the IBEF website. The vast presence of e-commerce and increasing growth are anticipated to increase the growth of route optimization software in India. Also, government policies on logistics and warehouse optimization are further projected to fuel the growth of the Indian route optimization software market. As per the August 2020 publication by the Ministry of Commerce and Industry, the National Logistics Policy will create a single-window e-logistics market to reduce the cost of logistics from 14% of GDP in 2020 to less than 10% by 2022. The publication also stated that the introduction of GST and e-way bills reduced the turnaround time of trucks by 20%. Additionally, announcements made by the finance minister, Nirmala Sitharaman, in her budget speech like the addition of 1200 airplanes, geotagging of warehouses, the allocation of INR 1.7 lakh crore in 2020-21 for the transportation sector, and so forth are anticipated to strengthen the future logistics industry in India, thereby driving the market growth for the route optimization software market in India. Also, the recent proposal of the new warehouse policy by the central government for the development of warehouse zones in the model of public-private partnerships (PPP) to cut logistics costs and improve transportation is anticipated to drive the market growth for the Indian route optimization software market during the forecast period.

Lagging internet infrastructure and connectivity problems

The route optimization software market in India is anticipated to see robust growth in terms of market share because of the growing e-commerce industry, government policies to enhance logistics and transportation and warehouse optimization proposals. However, the poor internet infrastructure and connectivity problems are anticipated to restrain the overall market growth for the Indian route optimization software market. According to the April 2020 Report by the QS I-GAUGE, 53.42% of the people using home broadband faced poor connectivity, and 32.09% faced signal issues. Also, the infrastructure for the internet is inadequate for the increasing demand for better connectivity and operations. Issues like limited international bandwidth, high transit costs, and high data centre setup costs are often faced by the internet service providers (ISPs), which will lead to poor connectivity and signal issues, thereby projecting the decline in the market for route optimization software in India.

Segmentation

• By Product
  • Software
  • Services
• By Application
  • Food Delivery
  • Ride-Hailing Services
  • E-commerce
  • Others