'Consumption Trends Shaping Outlook': Transport Corporation of India's Vineet Agarwal On How Supply Chain Is Evolving

Last month Hindustan Uniliver, one of India’s largest fast moving consumer goods (FMCG) companies, announced that it would directly supply to kirana stores, something that could disrupt traditional supply chains in the country significantly. This comes at a time when quick commerce is growing rapidly, also bringing further disruptions to logistics as we’ve known it so far.

Vineet Agarwal, managing director of Transport Corporation of India (TCI) said, “The evolution and the growth of e-commerce has really changed a lot of the supply chains. Networks had to change, the warehousing structure or the distribution networks, because there were elimination of the certain middlemen that happened,” says Agarwal.

From managing cold and dry SKUs to adapting to smaller, more frequent order quantities, players in the supply chain sector are having to constantly adapt to the demands of a fast-paced market.

It’s no longer a standard set of SKUs since each dark store caters to a specific geography, meaning the product mix varies based on the local population’s needs. Additionally, it’s not just about the type of SKUs—there’s also the distinction between cold SKUs and dry SKUs, further adding complexity.

“Many companies are still figuring out the final end of how this will look like. I think the next year is, or rather 2025 is when we will see what really it entails,” Agarwal said.

Agarwal highlights that while kirana stores still dominate FMCG sales, newer channels like dark stores and direct-to-consumer deliveries are gaining traction, creating an intricate balance between traditional and modern distribution networks.

Despite the challenges of increased operational costs and complexities, Agarwal remains optimistic. “What we can see is that the entire supply chain is getting more and more localised, because you want to avoid any disruptions,” he added.

In this week’s The Core Report: Weekend Edition Agarwal about sustainability, upcoming new sectors and if quick commerce and e-commerce will really dominate the market.

Here are edited excerpts from the interview:

One of the things that we're all experiencing, particularly as urban consumers, is obviously the impact of quick commerce or the benefits of, let's say, ordering food and having it arrive quickly and more and more people eating out or eating fast food. All of this affects and helps the logistics industry down the line because supply chains are constantly being rigid. Hindustan Unilever announced last month that they want to now supply products directly to kirana stores.

This is obviously a substantial number because we are talking about millions of kirana stores. This in some ways bypasses their existing and longstanding distributor network. And we've seen how the distributors themselves are protesting against this, but be that as it may, tell us about how you are seeing this from your vantage point as the person who enables the distribution of products, whether it's to dark stores or to kirana stores or to distributors or to warehouses and so on.

What's happened in the last few years is that the evolution and the growth of e-commerce has really changed a lot of the supply chains. Networks had to change, the warehousing structure or the distribution networks, because there were elimination of the certain middlemen that happened.

Now, when an FMCG (fast moving consumer goods) company is servicing the various channels, the channel that got really added on the last decade or so was the e-commerce channel with the big platforms coming in. Clearly, the change has started to come in where in the last 18 months, I would say, or a little longer than that, we've seen a proliferation of all the quick commerce guys. And essentially, that is leading to disruption in the networks as well.

We as a company operate at the backend level of the fulfilment. So there's an FMCG company, which sends material to this particular warehouse that we are managing. We could be managing the warehouse of the supply of the FMCG company as well.

And then from this particular warehouse, we're supplying to the dark stores of the companies. We don't operate those dark stores for the e-commerce companies. And then they are delivering it finally to the consumers.

For us, it still remains a B2B business, but the nature of that has changed because the order quantities are lesser. It's a more of a daily delivery versus in the distributors cases, it was perhaps a lesser frequency. The SKUs are changing.

It's not one standard SKUs because each of the dark stores have a specific geography that they are servicing, which would also mean those geographies have certain population, which requires those kind of SKUs. So that has changed as well. And the third element here is not just the type of SKUs, it could be also cold SKUs versus dry SKUs.

So we also run a cold chain with that. So this essentially is a very dynamic business model. Many companies are still figuring out the final end of how this will look like. I think the next year is, or rather 2025 is when we will see what really it entails.

Many people say that distribution networks have been and are being flattened in recent years. Can you tell us, for example, if you were to take, let's say a tonne of Godrej soap or Lux soap, which leaves the factory or left the factory maybe five years ago, and how would it go versus let's say how it possibly could go, including whether to a Kirana store or to the dark store, which in turn is picked up by one of these new quick commerce companies?

Well, those channels co-exist right now. And they will continue to co-exist for some time because we do not expect e-commerce or quick commerce to really dominate the market right away. It is gonna take time, it started to happen.

Urban, of course, urban commerce is changing much more rapidly than other places. But clearly we are seeing that from the factory it is going to a fulfilment warehouse in a city, in a state. And from there it goes to a distributor, wholesaler, Kirana store.

And whereas in the case of an e-commerce or a quick commerce, it will be from the factory to the warehouse in a state, then finally to another warehouse of the quick commerce or the e-commerce guy, then to the dark store and finally to the consumer.

In the case of a platform company, it won't have that dark store element. It'll go directly to the consumer. So in essence, the channels are there in place, but it's evolving.

Kirana stores are still 80% of consumer product company sales. And I'm sure that'll change, but it's not changing in a hurry. So that goes to your point. But as I can see from what you're saying, you still need at least three to four layers of assimilation and then further distribution before a product actually reaches the final customer.

That's true, because getting from now, we have to also remember there are multiple factories a company runs. It's not one factory is not producing all the products. So in fact, the produce is coming from everywhere in the country, from maybe outsourced production as well, overseas as well.

And they are coming to a particular warehouse where they are all getting consolidated. And then from there, it is moving to the next channel. So that will continue to happen.

You said that the lots have become smaller and the SKUs have also changed, which means that while all of this is benefiting customers, because things are reaching them faster, it's not necessarily easy for those who are in distributing it because the way they're dealing with product, at least the scale of it is changing.

Yes, because at the warehouse fulfilment level where we are managing, instead of sending a, let's say a case out, we are sending a product like a piece out or a unit out. That's the standard definitions that we use. So that is a big step because it could be, okay, I need five soaps. And versus saying, oh no, you take two cases, which could be 12 into two. So those are the typical changes where the tuning has to be at the unit level. So the chances of errors increase, the chances of even damages can increase. So the operation becomes even more trickier and even more complex.

And what does this do to costs when you start splitting up like this?

Well, costs typically are much higher because you're picking at a unit level versus at a case level or at a pallet level. And over time, whether this cost will come down, I don't think so because there could be some level of automation that will happen, conveyor belts or robotics, etc. But that will drive down costs to a certain level.

Ultimately, it is the delivery costs are actually the highest costs in the supply chain, in the network. So those are not going to go away in a hurry, notwithstanding when drones come in or automated delivery systems.

Let me put the question a little differently. You're a 60-year-old company founded in Calcutta, now Kolkata. What has changed and what has not? I think we've talked a little bit about what's changed and maybe the most disruptive part of it. And I'm sure there are some things which have not really changed. So tell us about that and how you are seeing the logistics distribution space from the TCI vantage point.

Well, we started off as a one-man, one office, one-truck company in 1958. Since then, the company has evolved from just being a transport company to an integrated multimodal logistic solutions provider where we do road, rail, sea as well. And this is serviced through a network of 1400 branches across the country.

And we're now moving close to 2-2.5% of India's GDP by value of cargo every year. We do a lot of the high value products, less commodities and so on. What we are seeing in terms of changes are dramatic changes that have happened in the last 25 years from a consumption perspective, from the infrastructure perspective, from the formalisation of the economy perspective.

And these are changes that have affected the economy first of course, but also companies like us because we are able to then tune into what's happening and accordingly offer products and services that our customers are wanting. So the business has changed dramatically in the last 65 years, but the value system has not changed in our company. We go by a very strong ethos of something called CORE, C-O-R-E, which is customer focus, ownership, responsiveness and empathy. And that has not changed in the last 67 years.

And when you talk about high value, could you give us some illustrations on what kind of high value goods you move and in which industries or sectors?

We work with all industries. So predominantly in the engineering side or the automotive side, high-tech, consumer, even defence and chemicals. So there are all the industries where they're mostly into finished goods movement, lesser into commodities and the raw material side.

But it's essentially when the customer is also seeking value in the delivery. It's not that it's a price-based delivery. It's not a cost element is one of the factors, but the most important element is also service and how we're able to deliver it without any damages.

And when you talk about products and let's say high value products, obviously in many of them, there are imported elements in it or imported components within that. So I'm assuming you're handling the whole chain of bringing it into a certain factory and it all comes together and then it goes out again. How, what is that looking like today and how is that changing? Even as let's say there is more domestic manufacturing or at least we want to do more domestic manufacturing, particularly in areas like electronics.

Well, what is happening is that the ecosystem around suppliers who provide these components, whether it is in the automotive sector, whether it is in the electronic sector, that ecosystem is still under development. In the automotive sector, it is still very, very good. In fact, it's become a base for exports as well.

So the component, so that is a well-evolved sector, but in the EMS and the other sectors, that's still problematic. One statistic that I've read is that for one of the phones that is made in India, 90% of the components are still imported. So it is going to take time, but what we can see is that the entire supply chain is getting more and more localised, firstly, because you want to avoid any disruptions.

In the last few years, post-COVID, we've seen either inventory shortages or we've seen the Red Sea crisis or ship getting stuck in the Red Sea and on the Suez Canal. And all of those things have led to very high disruptions in supply chains. Those are being addressed more and more as we localise supply chains.

The other thing that has started to happen is that you're not leaving your supply chain understanding to tier 1 only. You're going to go down to the tier 2, tier 3 level to see how robust and how resilient the supply chain is. Because you're as strong as your weakest link.

If the link in tier 3 is not that strong, it is going to affect everyone else. So nearshoring of the components is also increasing. The depth of supply chains is increasing as well as creating more alternatives to just one or two or three suppliers is also increasing.

Is there an illustration that you could share where it demonstrates how it's not, and nothing is easy, but how, let's say, relatively easy it is or how complex it is to switch supply chains? I know you talked about the Red Sea. That's one kind of problem, which is more, let's say, to do with war and war risk. There is, of course, the China factor, which has been hanging over us for many years now. And then there are incentives. The government is saying, I will give you production-linked incentives if you produce in India or if you're able to build components in India. So how is that looking to you and the speed at which it is happening or maybe not happening?

No, it is happening. I think certain schemes like PLI, etc, putting a lot of impetus to grow manufacturing in India and to build those ecosystems. But I think we have to look at that, the supply chain, not from just one perspective of what is happening locally or not, but also from perspectives of what the consumer wants and also from a perspective of what the cost structures are.

So to give you a case study, there is a company in the West Coast that operates into a certain chemical. And their problem statement was that, look, we are sending these chemicals or a certain product in these 50 kilo bags by regular trucks. And we are seeing a lot of losses and damages that are happening.

The trucks are taking longer time. And by the time we make the deliveries, we are losing a certain percentage as well as the cost structure is higher. And the third element is that the carbon emission, since now a lot of companies are talking as well as implementing on ESG is very high.

So we came out with a solution where we bought those, took those bags and put them into a jumbo bag of let's say a tonne and stuffed them into containers, which we locked. And we sent the containers via rail to the destinations where we reopened them and re-bagged it and sent it to customers. Now in this situation, the overall packaging cost came down.

So the plastic that was used in packaging came down substantially. The damages reduced because instead of going in open trucks, they were going in containers and it was going by rail. So again, the logistics costs came down.

Net net, the company is saving on overall costs as well as getting a substantially reduced carbon emission. So this means that they have addressed the supply chain in a different manner, not necessarily by looking at only whether I can buy something from overseas or get something more cheaper domestically.

So you highlighted and stressed on the multimodal nature of what TCI does today. And in this case, you moved something which was I guess going only by truck into truck plus rail plus truck. Now I'm sure that reduces, that increases the time, though it reduces costs. How would you say, I mean, if you were to look at a map of the country and all the goods you said, you represent almost 2.5% of GDP in value. And you see goods moving around. How would it have looked, let's say a couple of years ago? How does it look today? And how could it look a couple of years later when you'll have more, let's say expressways going? And let me supplement the question once you answer this.

Yeah, well, this is not going to be road plus rail only, but sea as well. I think the dramatic change that is starting to happen is adding the coastal waters of India as well as inland waterways over time. Today, 6% of the cargo of the country moves by sea domestically, and about 20, 25% by rail and about 60 - 65% by road.

Now this number has been more or less stagnant in the last few decades. Rail has picked up a little bit, but again, not necessarily at that fast pace as compared to road. And this mix needs to change because if our country needs to be competitive, whether it is domestically or for an export perspective, we need to bring down logistics costs.

And one of the elements of logistics costs is actually moving to multimodal as much as possible. So if I would look at from here, from 10 years onwards, I definitely see the growth of the rail sector, the growth of the coastal shipping sector. I think this is evident because the investment that the government is also making into these kind of infrastructure is extremely high.

Well, simultaneously with the road as well, but it will lead to this change where perhaps rail gets to about 30 odd percent and coastal shipping to about 10%. And we are able to bring down road to under 60%. So this will be important from many perspectives, including our target as a country to be zero emission by 2070.

So you have a fleet of ships. So tell us about the shipping side of your, of DCI and how does that fit into what you're either bringing in or taking out?

We operate six ships, four on the East coast of India and two on the West coast of India. These are all container ships. And the benefit that we have because of our 1400 offices is that we are able to connect cargo from across the country to these ships.

And yes, the time might be slightly higher than let's say moving point to point, but in the end, the cost savings are there as well as again, I reiterate on the green logistics. So we have clients that we are moving, let's say from North India, a whole rake of containers that's coming to the port in Kandla. We load it onto our ships, take them to let's say Cochin and then door delivered by road to each of these customers.

This kind of integrated multimodal logistics is what we've been providing now for close to 5-7 years now. And this is expanding quite rapidly for us as a business model.

And what would be, let's say your top 2 or 3 items that you distribute or deliver through this route, which is using shipping as a key component?

Actually, surprisingly, there are lots of products. It's not just 1 or 2, it's we see tiles from the Western part of Gujarat, we see cotton that's going, we see cement actually, or engineering products, almost everything is starting to move in some way or manner on the coastal routes. And on the East Coast, in fact, we service islands like Andaman sector where everything goes from the mainland, including grain.

So it is quite an exciting business move in the last decade or so, because we are seeing that there are customers who are able to penetrate certain markets now, because they are able to move their product where they were not able to at a lower price.

And in this case, do customers ask for options like this, or is it your sales team which says that, listen, this is how we can maybe deliver much larger bulk to all these places that may be relatively lower cost or something else?

Yes, I think the discussion happens around multiple options or multiple modes and how we can service them. But the final decision still remains with the customer. I think we are coming to a stage over time where customer might tell us that, look, this is the price and this is the time that I need the product to be delivered.

Now you choose the mode, however you want to deliver it. We've not got down to that stage yet, but I think that is something that will happen. The other factor that's starting to impact decision-making also for corporates is the digitisation of the network, in the sense that there is a lot of visibility which has not been in the past.

And that visibility means that I can take decisions more easily and better.

So can you expand on that a little bit? When you say visibility of what, are you saying the product actually where it is at this point of time, and therefore I want to do something about it, or just the knowledge of it?

Just the fact that today tracking has become hygiene. Almost you can track a truck or track a product anywhere across the supply chain. The other element is almost all the documentation now is coming to a central platform called ULIP, Unified Logistics Interface Platform.

And whether it's all companies, whether it is a supplier, whether it is a vendor, whether it is a port operator, all that information is centrally available. And including when the truck is going through a particular toll point, the RFID data that is captured there is also visible to companies. So that creates a platform where you're able to really view everything and then take decisions accordingly.

So which means that today I find, if I promise that it's going to get there in seven days using a mode of transport, you know it will get there in seven days and you can track it very efficiently.

And what are some of the things that people are doing as they have access, including yourself as the logistics company, as you have access to more granular information on movement of goods, of movement of let's say a truck or a freight car in a railway context or a ship, how are you able to use this to achieve either more efficiency or maybe just keep your clients better informed?

Well, certainly turnaround time is big. I think that helps in the overall efficiency of the asset utilisation improves, you said it better. There is also predictability is better.

So you are able to plan whether it is a customer or whether it is us in terms of our resources. It helps customers, for example, save tremendous amount of costs. We work for automotive companies where we do just-in-time for them, where the products are coming from maybe 2,000, 3,000 kilometres away and they're able to see when it's coming into the plant and they're just doing complete direct line feeding from our crosstalk into the plant.

And that has saved thousands and thousands of crores of inventory costs for many of our customers. And this kind of visibility is a value addition to the business. It's a driver for growth and ultimately it is what keeps the customer sticky to us.

Right, and speaking of growth, and I'm gonna sort of look ahead a little bit now, how, where is growth coming from and do you see it coming from, let's say in the next couple of years? And you could split that up. I mean, one is let's say overall economic growth, which is maybe 6.5% now and not maybe what we thought it was, which was 7.5% or 8%, but nevertheless, it is a growing economy. So is it that, are you carving out more areas within this economy? Are there other new sectors that you're looking at?

Yes, what is, I think one is that logistics sector tends to mirror GDP growth to a great extent. That's one, but there are certain themes that are very big as well, which I talked about a little earlier, which for example, consumption trends. Now that is really changing the way that we are looking at supply chains.

The second is formalisation of the economy. As we've entered into a GST regime a few years ago, the economy means that even all the producers and suppliers are also all getting formalised more and more, including service providers like ours. So which means that today, instead of someone working with an unorganised guy, they're working with organised companies like us.

So that creates a market opportunity for us as well. The third is essentially the infrastructure development. With that happening, we are seeing that multimodal sector is also growing very rapidly.

So, and then there are lots of other new themes that are coming up. For example, telecom sector did not exist like 20 years ago. It's become big now.

Defence is becoming big now because domestic production is increasing. Chemical sector, for example, used to be dependent a lot on unorganised sector operators, which is again getting formalised more and more because of safety concerns and compliance needs. Like this, we are seeing multiple new sectors.

Some sectors we did not even know will come to India, for example, semiconductors or the EMS. So the themes for the next few decades, in fact, next two or three decades, continue to be quite dynamic. And for us, these are all very high growth opportunities because as a company, we've always been focused on value creation.

You know, I saw somewhere you saying that basically how in the chemical industry, people are looking for good quality transportation, high quality warehousing infrastructure. So, which means that all of this was there, there was transportation, there was warehouses, but what people want is maybe better quality. And obviously, there is a safety element when we talk about chemicals and people maybe want more safety.

And then you talk about, in your example, leakages, which is a slightly different challenge or a problem, but nevertheless, that's an opportunity as well. So are you seeing similarly other industries demanding, let's say more of these factors, which maybe earlier were not so prominent?

Absolutely. Compliance has become very big. So clearly with compliance, there is an element of safety, there's an element of damages, etc, that comes down substantially.

So the way that one has been operating the processes in the past, those processes have to also get aligned to the present situation. Apart from that, we are seeing that the market is changing from not just a domestic consumption market to an EXIM market, which also means that when you're exporting, that level of compliance or the needs are includingly very high.

And of course, this is coming from the China plus one strategy, etc, where companies are setting up more plants in India, not just for domestic consumption, but for export as well.

So these are the other factors that are really driving the sort of formalisation more and more and the demand for such services. And last but not the least is the sustainability angle.

I think with carbon emissions increasing quite rapidly and the consciousness increasing more and more, we are seeing that companies want to drive either alternative fuel vehicles or use multimodal means of transport, flexible or recyclable packaging, as well as reducing overall carbon footprint across the supply chains.

So these are factors that are now driving this change towards what we are seeing as a new phase of logistics in India.

So the, I mean, we don't get into too many numbers on this show because the idea is to be a little timeless, but when you look at incremental profits or profitability growth and incremental revenue growth for TCI, which of these areas would contribute the most in let's say the coming one or two years?

Well, you know, I don't go, we don't go into specific industry verticals, but as multimodal logistics, 10 years ago, multimodal logistics was probably 10% of our business. This year or the last financial year, we did almost 30% of our business came from multimodal logistics. So we are clearly seeing a trend towards that more and more, and this would include all the verticals.

So a chemical company is also asking for rail logistics or for sea logistics. Simultaneously, the profitability element has also increased quite a lot. We've delivered more than a 20% CAGR in terms of profit growth for the last six, seven years.

And that clearly reflects also into, you know, the company's overall profitability and then share capitalisation.

And I mean, and linked to that, the investments that you're doing right now and in the next couple of years is more towards ships and such infrastructure or?

Yes, yes. It's a combination of multiple factors because, you know, the regular business models are also running and you need that support infrastructure for that as well. So we have a roughly about 350 crore CapEx plan this year, which includes investment into ships as a, the ships that we've ordered will come in two years from now, but this is advanced payment for some of that.

We're investing into trucks, into warehouses, into rail infrastructure. And this kind of CapEx will continue for the next four, five years. So we expect to spend in the like of 1,000 to 1,200, 1,300 crores in the next four years.

So I'm gonna come to the policy part and what your outlook is in a couple of minutes. But, you know, when you look at market opportunities, how do you look at it? I mean, this is a part personal question as well.

I mean, do you look at it as a consumer and say, okay, you know, there are more McDonald's opening up so that they must be therefore, you know, building up their backend supply chains to ensure that, you know, fries come from potatoes, which come from another part of India, or it could be cold chain because more people are consuming ice cream and therefore that has to. So, and chocolates, which I could see that you're already delivering. So how do you get your ideas in terms of where things could be going or not going?

Yeah. Most importantly, listen to customers. I think from including myself to all the senior members of the team, we all visit our customers very regularly. New customers or the existing customers, just to understand what are their expectations? How are they seeing trends? Clearly, we are also seeing some of those trends and then we are able to collate some of that across industries, across segments and see that look, let's look at this as a driving force or driving factor.

As personally, I see what my kids are trying to do. What are they looking at? And one of the things that they've been talking a lot about is sustainability.

That generation, they're 20 and 17, that generation is talking a lot about climate change and the effect that's happening. So we are also driven by that organisation, but then it's also simultaneously our customers are saying the same thing. So those alignment, when they started happening, you see that you get a little bit more clearer in terms of direction for strategy.

And again, we take a very long-term view. We are not taking a view of next two years, three years, but a 10-year view or a 15-year view on how things are going to evolve in the next, for our business. And that helps us to be a little bit more clear-headed versus taking short-term decisions for maybe short-term profits.

So, I mean, I noted that you've used the example of chocolate. So tell us about chocolate. I mean, this is very anecdotal. I see a lot more chocolate stores than before. I see a lot of startups producing chocolate. I know it cannot be a big business in the scheme of things, but it's definitely an interesting business. So is that something that you've seen or observed closely as well?

No, I think it's consumer trends. I think it's not specific to chocolates or anything, but just generally consumer trends have been orientated towards mass consumption around these products. And these are now, you know, I think a certain generation, the kind of satisfaction that one wanted was always delayed.

Now this instant gratification means that within 10 minutes, 15 minutes, you're getting that chocolate or you're getting whatever you want. That has changed how supply chains are affected. And that hits us a lot harder when we have to design things for our customers from a solution perspective, because the demand is speed as well as price.

And it's extremely difficult to match that because, you know, if you want speed, then your cost will go up. It's a standard curve, but I think those are theories and models are getting challenged.

And a small supplemental question to that before we come to policy. And do you feel that this model therefore could be under some kind of pressure as we go forward? I mean, yes, there is venture capital that funds quick commerce, and therefore someone is taking a hit, but do you think producers, distributors, consumers can realistically pay for all of this, the small lots, the higher speeds, the shifts in, let's say, the supply chain flow of product?

Well, you know, I think it's still to be seen. I think there is going to be a middle ground that's going to come. I think everyone is bleeding quite rapidly in this space right now.

But I think with the SKU mixes changing or the quantity of SKUs increasing, that is per delivery order size increasing and so on, I think some of those can get addressed over time. But it is interesting that the challenges are known, but unfortunately the solutions are not entirely known yet. Some say it's volume, some say it's value, but I think ultimately the game would be a combination of both and some matrix.

Right, okay, so last couple of questions. More forward-looking, we've got a budget coming up. I mean, I don't want to pin you down to a budget and make you wear your ASSOCHAM former president hat, but in general, what are you looking out for and what would you expect as a larger industry person and as a logistics person?

You know, for everything, I think the infrastructure spend that's happening is phenomenal. I think that should continue because it has a massive trickle-down effect, almost 3x kind of impact, impacting 10, 15 industries directly and indirectly. That has to continue.

Some level of fiscal prudence is important because that is clearly inflationary otherwise. The cost of borrowing is still relatively high for new CAPEX to happen, as well as we see a stress at the MSME level also because of either slower inflow of capital to them or essentially demand-led stagnation. So from all perspectives, the push towards infrastructure, push towards fiscal prudence and support to MSMEs and including building the ecosystem around what we just talked about from component manufacturers or the other, that ecosystem has to become very robust at the MSME level.

I think support at that level will be important. I think all of these factors actually work for the logistics sector as well. So I think we are quite well aligned to the needs.

And you mentioned MSME, I mean, with some emphasis there. So when you say support MSMEs, are you saying lower rates of interest or other more factory unit level?

The ease of doing business, I think the ease of doing business as an MSME needs to improve. It could be everything from factory licencing to the cost of electricity, to the cost of essentially labour and availability of labour, digitisation at that level, automation. I think there's so many things that are, just the, there are so many schemes that are there and when we talk to MSMEs, they're not aware of those schemes.

So just certain level of market access that gets created is important for them as well. I think, and we've been working very strongly trying to push this element is, things like ONBC can work really well for MSMEs, including the B2B element. Because, let's say I have a restaurant owner, I have three restaurants in the city.

I need to buy 500 plates. Now, if there is a supplier, let's say in somewhere in UP that can supply that and I go on to the ONBC platform, today none of the e-commerce platforms can offer that. But if I can do that at ONBC level, you have created market access for everyone.

So some things like that would be really useful and beneficial for the economy as a whole.

And that's a good note to end on. Vineet, it was a pleasure speaking with you. Thank you so much for joining me.

Thank you, Govind. Thank you for having me.