Logistics & Shipping News: India’s 9% Cost Target vs. Global Freight Spikes (Dec 14 – Dec 20, 2025)

The third week of December 2025 has been a high-stakes period for the global logistics sector. As India approaches its year-end deadline for radical cost reductions, international shipping lanes are grappling with a sudden surge in container rates. For The Exporter Hub members, this week represents a critical moment to audit supply chain costs before the 2026 regulatory shifts take hold.

1. 🇮🇳 India’s Logistics Cost: The Final Countdown to 9%

This week, Union Minister Nitin Gadkari reaffirmed that India is on track to hit its historic target: reducing national logistics costs to 9% of GDP by the end of December 2025.

• Single-Digit Success: Moving from 16% to 9% is a game-changer for Indian competitiveness. This reduction, driven by the PM Gati Shakti initiative and the completion of several Dedicated Freight Corridors (DFCs), allows Indian exporters to price their goods more aggressively in global markets.

• Impact on MSMEs: In Bharuch and surrounding industrial hubs, the reduction in “warehouse-to-consumer” costs (which dropped by 1.33% this year) is directly improving the bottom line for smaller exporters who rely on road and rail connectivity.

2. 🌊 Ocean Freight Alert: Drewry Index Surges 12%

Contrary to the “stabilization” expected at year-end, ocean freight rates saw a sharp spike this week.

• WCI Jump: The Drewry World Container Index (WCI) rose by 12% to $2,182 per 40ft container on December 18, 2025. This marks the third consecutive weekly increase.

• The Drivers: The spike is primarily attributed to rate hikes on the Transpacific and Asia–Europe trade routes. Carriers are aggressively managing capacity through “blank sailings” to keep prices elevated ahead of the 2026 contract season.

• Strategic Shift: CMA CGM announced plans to resume Red Sea routings for its Indamex service (US-India), making it the first major loop to return fully to the Suez Canal. This could eventually stabilize transit times for Indian exporters heading to the US East Coast.

3. ⚓ Port Revolution: The Indian Ports Act 2025 in Action

The transition from the 1908 legislation to the Indian Ports Act 2025 is now fully visible in port operations.

• Green Maritime Push: Major ports handled a record 855 million tonnes of cargo this year. The new Act has mandated that renewable energy usage must exceed 60% by 2030, with Deendayal Port (Kandla) already adding 20 MW of solar and wind capacity this week.

• Digital Transformation: The implementation of the Maritime Single Window is reducing vessel turnaround times, a critical factor for exporters looking to avoid “demurrage” and “detention” charges.

4. ⚠️ The Mexico 50% Tariff Threat

A late-breaking policy shift from Mexico has sent shockwaves through the Indian automotive and textile sectors this week.

• Broad Duties: Mexico has approved 50% tariffs on over 1,400 goods, including metals, cars, and clothing, from countries including India, China, and Indonesia.

• Rationale: The move is intended to protect Mexican domestic industries from “low-cost” Asian imports, but it presents a massive barrier for Indian exporters who used Mexico as a gateway to the North American market.

Source: www.drewry.co.uk