Digital Shift Exposes Indian Logistics To Cyber Risks

As India’s logistics industry rapidly embraces digitalisation, it faces an increasing threat from cyber attacks. The sector, which forms the backbone of supply chains, is increasingly becoming a prime target for ransomware, data breaches, and supply chain attacks, raising concerns over the security of sensitive data and operational integrity.

Ransomware attacks have emerged as one of the most significant cyber risks for logistics companies, with cybercriminals encrypting critical data and demanding payment for its release. The consequences of such attacks can be crippling, leading to operational paralysis and heavy financial losses.

Another major concern is data breaches, where attackers gain access to sensitive information, such as customer details and shipping data, due to insufficient cybersecurity measures. These breaches not only result in financial damage but can also tarnish the reputation of companies, causing long-term harm.

Supply chain attacks, where vulnerabilities in third-party vendors are exploited, are also on the rise. Such breaches can have a cascading effect, compromising the entire logistics network and affecting multiple stakeholders.

Cybersecurity Challenges In Indian Logistics

The increased digitalisation of India’s logistics industry, driven by the need for greater efficiency, has also opened up new vulnerabilities. A recent PwC survey highlighted that 38 per cent of logistics companies still face unresolved issues related to data privacy and security, pointing to the industry's growing exposure to cyber threats.

Dhruvil Sanghvi, Founder and Chief Executive Officer of LogiNext, emphasised the urgent need for stronger cybersecurity measures: “The threat of cyber attacks has reached a boiling point. With a staggering 50 per cent increase in cyber incidents over the past three years, it's clear that our industry is at a critical crossroads. Cybersecurity is no longer a luxury, it's a necessity."

He referenced the 2017 NotPetya ransomware attack on Maersk, which caused over USD 300 million in damages, to illustrate the potential catastrophic consequences of cyber breaches. Sanghvi stressed the need for logistics companies to invest in advanced cybersecurity solutions to protect operations and maintain client trust.

Awareness And Preparedness

A major obstacle in addressing these threats is the lack of cybersecurity awareness within the logistics workforce. Reports suggest that 55 per cent of logistics employees feel ill-equipped to handle significant cyber attacks, underlining the importance of employee training in cybersecurity best practices.

“Cybersecurity in logistics is now critical to protecting sensitive data, maintaining operational integrity, and ensuring the seamless movement of goods. From ransomware attacks to data breaches, cyber threats can disrupt entire supply chains, leading to financial losses and reputational damage,” said Zaiba Sarang, Co-founder, iThink Logistics, while highlighting the growing risk of cyber attacks on supply chains.

To tackle these risks, Sarang recommended that logistics companies adopt advanced cybersecurity measures, such as encryption, multi-factor authentication, and real-time threat monitoring systems. She also stressed the importance of collaborating with technology partners and conducting regular system audits to bolster defences.

Regulatory Landscape And Future Directions

The Indian government is increasingly focusing on cybersecurity regulations, urging companies to comply with standards that protect their operations. Compliance is crucial not only for security but also for maintaining customer trust.

Devam Shah, Chief Information Security Officer and DPO, Locus.sh, highlighted the growing complexity of safeguarding global supply chains: “Cybersecurity in logistics has become a pressing concern as supply chains increasingly face sophisticated cyber threats. Sensitive data, such as consumer information and consignment details, must be protected through robust security measures, whether stored on in-house servers or cloud platforms.”

Shah pointed to the findings of a recent India Cyber Threat Report, which revealed that the automotive supply chain was the most targeted sector in 2023. This highlights the increased vulnerability of supply chains across industries and reinforces the need for logistics firms to invest in cybersecurity frameworks such as ISO27001.

As cyber threats in the logistics sector intensify, companies must prioritise cybersecurity to safeguard their operations and protect sensitive data. With the rise of digitalisation, robust defences, employee training, and regulatory compliance are essential for building cyber resilience and ensuring the smooth flow of global trade.

Satyam Mishra

BW Reporters The author is a trainee correspondent with BW Businessworld