MSMEs, transshipment could drive India's next air cargo growth phase: ACFI

India’s next phase of air-cargo growth could come from small businesses outside the country’s biggest cities, alongside a push to turn Indian airports into international transshipment hubs.The opportunity was a key theme at the seventh Air Cargo Forum India (ACFI) World Conclave in New Delhi on Thursday, where industry executives discussed how to expand India’s cargo network beyond the established hubs and connect more Indian businesses to global markets.India handled about 3.72 million metric tonnes of air cargo in financial year 2024-25, up from 2.53 million tonnes a decade earlier, according to government data.At the conclave, Ministry of Civil Aviation Secretary Samir Kumar Sinha said the government was working on measures to make cargo movement more efficient.“As global supply chains diversify, India has an opportunity to strengthen its position as a reliable global trade and manufacturing hub, with air cargo playing a key role in pharmaceuticals, electronics, engineering goods and perishables,” Sinha said.He said the government's focus included streamlined screening, one-stop security, dedicated transfer-cargo security areas and greater use of technology. Air Cargo Policy 2.0 and the proposed National Air Cargo Community System are also intended to support end-to-end cargo processing, digital integration and lower logistics costs, he said.From production to exportRamesh Mamidala, vice president of ACFI and head of cargo at Air India, said smaller companies in tier-II and tier-III cities could provide more cargo if they receive support to access overseas markets.“Small companies is the right way forward, and tier two, tier three are the right markets today,” Mamidala told Forbes India.He said many businesses in these locations are already producing goods competitively but do not want to manage the complexity of exports themselves. Some therefore rely on logistics companies and other intermediaries to handle documentation, forwarding and first- and last-mile movement.ACFI has started engaging with MSMEs and companies that help them export, Mamidala said. The organisation is trying to understand the segment and bring these businesses into the industry's discussions.“Sometimes potential to produce is there. Potential to export, you need to stimulate,” Mamidala said.MSME-related products accounted for 48.55 percent of India's merchandise exports in FY25, according to government data.The India SME Forum's 2026 Digital Procurement Report, based on a survey of 27,045 MSMEs, says procurement, logistics and finance increasingly need to work together, while digital procurement remains fragmented across marketplaces, government platforms and other systems.Also Read: This week in Aviation: Air India flight controls scare, eVTOL, cargo pushIndia wants a bigger share of global transshipmentSanjiv Edward, president of ACFI, said transshipment could add another source of cargo for Indian airports. He said India currently handles less than 5 percent of its cargo through transshipment, while some global hubs handle more than half their cargo this way.Edward estimated that 2 million to 2.5 million tonnes of cargo currently overflies India and could potentially be routed through Indian airports. The processing time for transshipment cargo has also improved, Edward said, falling from about 72 hours to about eight hours in some cases.The competition is global. Cargo originating in a country such as Bangladesh can be routed through Singapore, Dubai, Doha or an Indian airport. “Indian airports are now competing with those other hubs,” Edward said.One way of serving those markets, he said, is through bonded trucking, where cargo is collected at a smaller location and moved under customs control to a major airport for onward international transportation. He cited Indore as an example of a city where such a model can be used while direct freighter capacity is not available.India has also been easing the customs process around transshipment. In April 2025, the Central Board of Indirect Taxes and Customs waived the transshipment permit fee for all transshipment movements and said online filing of transshipment applications had been enabled through ICEGATE.Delhi Customs' 2026 notices show transshipment permissions extending cargo movements from Delhi to a growing list of Indian airports, including tier-II and tier-III locations such as Varanasi, Indore, Mangalore and Bhubaneswar.Cargo capacityDelhi's Indira Gandhi International Airport remains India's largest cargo airport. It handled 1.109 million tonnes in FY25, up 10.6 percent from FY24, when it handled 1.003 million tonnes. Its two cargo terminals have capacity for about 1.8 million tonnes a year, according to Delhi Airport.Edward said Delhi was on track to handle about 1.2 million tonnes in the current year and remains the only Indian airport handling more than 1 million tonnes annually. He said the airport has enough capacity to handle 1.8 million tonnes.Noida International Airport, meanwhile, has begun operations with a cargo hub designed to handle more than 250,000 tonnes annually, with the facility expandable to about 1.8 million tonnes.Speaking to reporters on the sidelines of the ACFI conclave, Kiran Jain, chief operating officer of Noida International Airport, said, “The infrastructure is expandable; it is modular in nature." She said the airport was also focusing on policy, trained personnel and digital systems to improve cargo processing times.Mamidala said ACFI was starting work with smaller exporters early because building the ecosystem would take time.“The next phase of India’s air cargo growth will be shaped not only by expanding airport capacity, but also by how quickly the industry adopts new technologies and operating models,” he said in ACFI's post-event statement.