The managing director of India’s Bangalore-based TNT, Abhik Mitra, put it rather succinctly: “We had a good year in 2009. We grew our international business and we also grew the domestic business both in the service logistics space and expanded our network. Obviously, there is much more to be done in the domestic space as we continue to expand our business on that. But I think 2009, in essence, was the end of a very good year for us.”

Mitra went on to say that TNT’s international freight business grew by 50 per cent overall and 60 per cent in the India-Europe lane in 2009. According to him, “the market for the international freight business segment grew just over 5 per cent in the same period” proving to all that TNT India was “the preferred partner and was able to expand unlike other players. We are and also seeing tremendous demand from Tier II andIII cities for our services.”

The credit for the stellar performance in 2009, according to Mitra, was “partly to do with the game plan that we had. We had one integrated organization doing both international and domestic services. We engaged with our customers more sharply in our business because we always took care of both the requirements rather than one company doing international, another company doing domestic. From a domestic market perspective, the economic downturn did not threaten us.”

Strategy aside, TNT’s India growth came from the hi-tech and healthcare sectors. In the hi-tech sector, TNT has been working with a number of Fortune 500 companies with its “after-market business” through the establishment of key regional distribution centres that reduce delivery time and costs significantly. These distribution centres are in India and Southeast Asia feeding TNT’s air network. The air network, in turn, is seamlessly connected to the TNT-managed Asia Road Network across six countries, from Singapore to the south of China, in 125 cities.

As for 2010, Mitra is bullish about India and says the growing air and road network connectivity will help the company expand its reach. To add to that, the country is planning to introduce a national sales tax – presently each state imposes its own taxes on freight moving through its boundaries – which will mean lower taxes and higher freight demand, he says.

“We already have a very strong business (in India) and the acquisition of Speedage – a domestic road transportation company – in September 2006 and later its transformation, expansion and integration, provided TNT with “a strong base”, said Mitra. Soon after the Speedage deal, TNT CEO Peter Bakker had pointed out that TNT will be among the top three express companies in India with the acquisition with combined annual revenues reaching €100 million in 2007.

TNT has gone ahead with its plan to spend about €100 million over a five-year period from 2006. Mitra said that a fair amount of investment in infrastructure had taken place. “I can’tquote numbers,” he said. “We need to spend more as we expand the business…(we have spent) a fair amount in termsof improving line haul, improvingthe quality of our services, people,investments in infrastructure…IT hasbeen a major area for investments…The issue now is to expand our base andimprove the quality of our services andimprove our loyalty to our customers,improve the reach of our business. Thatis absolutely the focus.”

While agreeing that TNT could do little independently to ramp up the road infrastructure, he pointed out that in the last three to four years, many roads including the Golden Quadrilateral (the highway network connecting Delhi, Mumbai, Kolkata and Chennai) had improved. “We see that average truck speeds have improved in our industry from what it was (a few years ago)… The roads of Delhi, Mumbai or Kolkata,” said Mitra, “are jammed and pick-ups take longer… there is nothing much we can do about them.”

Even so, he said, that from a domestic perspective, “we would like to have our freighters but I think freighters also come with a certain amount of scale and I think our focus has been much more on the ground in the initial period,” said Mitra. He was quick to point out that while for the next one or two years, TNT will continue to concentrate on ground express.

“Our first and most immediate focus is to get the ground business, the business service quality and size to the next level and also to help connect India and Europe,” he emphasised. That, however, did not mean TNT would “not focus on getting freighters at some point of time”.

As for the express and logistics business in India, Mitra forecast that “it is going to be an expanding business”. Now that most international majors – Fedex, UPS, etc – have started domestic services, TNT does not believe that its position is threatened. According to Mitra, the business is going to expand substantially – two to three times the country’s GDP.