The cost of transport as a systemic constraint on economic growth

Within the BRICS countries, logistics has historically developed under conditions of vast geographical distances, uneven infrastructure and significant differences in levels of industrial development. As mutual trade expands – by the end of 2025, trade between the member countries exceeded US$1 trillion – logistics costs are taking on the character of a macroeconomic constraint.

Over the past five years, intra-BRICS trade has grown by an average of 4.75 per cent a year, and this growth is increasingly constrained by the capacity of transport systems. As noted by Lubarto Sartoyo, Head of the Committee for Cooperation with ASEAN Countries at the Eurasian Business Association, President of the Alliance of Business Structures and Entrepreneurs of ASEAN Countries, Deputy Chairman of the Russian-Asian Union of Industrialists and Entrepreneurs, intra-BRICS trade is growing by 18–20 per cent year on year, and this trend is expected to continue. The load on ports, land and sea routes has already increased by 30 per cent, and, most importantly, it will continue to grow. Accordingly, capacity must increase by at least 50 per cent in the coming years. Under these conditions, autonomous transport is no longer an option but a necessary solution, while logistics itself is becoming a structural factor in economic integration.

The share of logistics in the GDP of different BRICS countries averages between 6 and 8 per cent. This is a huge sector, comparable to major industrial sectors. Infrastructure investment will exceed US$3 trillion by the end of the decade, and at least a quarter of this amount will go towards digitalisation and automation. Logistics and its innovative, information-based component will become the foundation for harmonising the economy as a whole

Lubarto Sartoyo

President of the Alliance of Business Structures and Entrepreneurs of ASEAN Countries

High logistics costs directly increase the final cost of products, reduce export margins and limit the competitiveness of producers in foreign markets. This effect is not reflected in the budgetary system, but it is a direct deduction from the economic efficiency of the BRICS countries and one of the main obstacles to the growth of mutual trade, particularly as the share of settlements in national currencies has already exceeded 67 per cent – without effective modernisation of logistics, the financial advantages of such trade remain unrealised.

Autonomous transport in the modern logistics sector is not an isolated mechanical achievement. Rather, its economic and operational viability is entirely dependent on a dense, multi-level digital ecosystem

Alexander Titov

Deputy Secretary-General of the International Digital Economies Association

A persistently high level of logistics costs is characteristic of most BRICS economies. According to Alexander Titov, large-scale deployment of autonomous transport is possible only with deep integration into digital infrastructure and continuous data exchange between all participants in the logistics chain.

In India, logistics costs are estimated at 13–14 per cent of GDP. This is twice as high as in China, and reducing them will change India's competitiveness as a trading partner across the entire supply chain.

The country's authorities have set a target of reducing logistics costs to 9–10 per cent of GDP by 2030, investing INR 1 trillion (US$10.44 billion) in multimodal infrastructure. According to the Indian government, every INR 100 (US$1.04) invested generates INR 321 (US$3.35) in GDP growth.

In Brazil, logistics costs remain at 15.5 per cent of GDP. According to the Agroexport report, a TV BRICS partner, since 2022 the country has ranked second in the world by the volume of agricultural product supplies: agribusiness exports grew from US$138.4 billion in 2024 to US$169.2 billion in 2025, accounting for 48.5 per cent of all Brazilian exports.

Imports of agricultural products reached a record US$15.6 billion. The grain harvest – 346.1 million tonnes – also reached a historic high, meaning that the volume of cargo that must be transported through ports and by rail has reached a record level.

Photo: Kinwun / iStock

Every additional million tonnes increases the risk of infrastructure congestion, so automating the “field – grain elevator – port” route is becoming a matter of safeguarding export revenues. Brazil remains the world's largest supplier of soya and maize, while at the same time depending on fertiliser imports for more than 80 per cent of its needs – their cost accounts for up to 40 per cent of the cost of major export crops. Reducing the logistics burden by each percentage point translates into a price advantage in the markets of Asia and the Middle East.

In China, the share of logistics costs in GDP fell from 14.4 per cent in 2023 to 13.9 per cent at the end of 2025. This is the result of the systematic digitalisation of port infrastructure. The People's Republic of China has already built and operates 30 automated container terminals – more than any other country in the world. At the beginning of 2025, Qingdao Port broke the world record for crane productivity for the 12th time, reaching 60.9 containers per hour. Port automation is no longer an experiment but has become the foundation of the operating model of the country's largest logistics hubs.

In Russia, the share of logistics costs in GDP is estimated at more than 16 per cent. The length of routes and climatic conditions make long-haul freight transport a costly item in the structure of the economy. In 2024, Russian exports increased by 8.4 per cent in physical terms, placing additional pressure on existing transport corridors.

South Africa faces a dual challenge: high fuel costs and uneven road networks between provinces. Ethiopia is addressing the challenge of connecting remote agricultural regions to export hubs. Middle Eastern countries with close economic ties to BRICS are creating additional opportunities for coordinating energy and transport policy. The UAE, with its compact territory, is focusing on the speed and efficiency of transit corridors linking Asia, Africa and Europe. Despite differences in economic structures, logistics remains one of the most expensive elements of the BRICS economic system, and its reform is becoming a necessary condition for the group's further growth.

Growing trade turnover and pressure on infrastructure

The increase in mutual trade within BRICS is driving rapid growth in pressure on transport systems. Port infrastructure is operating at high capacity, railway corridors require increased throughput, and motorways are facing a constant rise in freight traffic. However, the pace of infrastructure development in a number of countries is not synchronised with trade turnover dynamics.

India's National Logistics Policy has identified 196 critical infrastructure projects – from port modernisation to the expansion of railway lines for transporting coal, steel and food. The key tool for their implementation is the Unified Logistics Interface Platform (ULIP), which brings together data from all participants in the chain – from customs authorities to warehouses and transport companies. This makes it possible to track cargo movements in real time, reduce processing times and lower administrative barriers. Since the launch of the National Logistics Policy, more than 614 organisations had registered with ULIP by 2024, making it the main digital tool for managing freight flows. At the same time, reform of the Goods and Services Tax (GST) reduced truck waiting times at state borders by almost 30 per cent.

At the Logistics Shakti Summit 2026, India discussed the development of air freight – the country intends to build dedicated cargo air terminals independent of passenger flights. India is using investment in multimodal infrastructure to consolidate its role as a connecting link in the group's trade flows. This involves creating transit routes that will connect BRICS countries through Indian ports, railways and digital platforms – from fertiliser supplies from Russia to Chinese car exports to Africa. This positions India not merely as a participant but as a coordinator of logistics chains within the grouping.

Russia is expanding freight flows along the North–South Corridor, which, following completion of the Rasht–Astara rail link, will become one of the key routes for transit between BRICS countries. Ethiopia, Egypt and Iran face their own challenges: from connecting remote agricultural regions to modernising port infrastructure and integrating into existing transport corridors.

The growth of freight flows in BRICS countries is accompanied not only by infrastructure wear and tear but also by an acute shortage of personnel. All this creates a structural gap: the economy requires more transport capacity, while the transport system cannot provide it. It is precisely this gap that is the main driver of the transition to autonomous and digital solutions.

“Autonomous vehicles require Vehicle-to-Everything (V2X) networks, 5G infrastructure and real-time data processing systems. Only such a digital environment ensures the safe operation of autonomous transport and allows the operator to intervene remotely in non-standard situations,” Alexander Titov noted.

Transition to a digital logistics management model

The response to these constraints is the transition to a digital architecture for transport systems. A model is gradually emerging in the BRICS countries in which transport, infrastructure and digital platforms are combined into a single data-exchange framework. The key principle is that an autonomous vehicle is not an isolated unit but an element of a wider system that includes digital road infrastructure, telecommunications networks and control centres. Without such an environment, even the most advanced autonomous lorry remains simply an expensive vehicle.

China is implementing this principle most consistently. The country's Ministry of Industry and Information Technology has deployed more than 35,000 kilometres of test roads equipped with C-V2X technology.

This is a cellular communications standard that enables a vehicle to exchange data not only with other vehicles but also with road infrastructure – traffic lights, signs and control systems – in real time. The technology has already demonstrated its effectiveness: at test sites, response times to road events have been reduced by tens of per cent, while congestion and accident rates have fallen.

India has reserved the 5.9 GHz frequency spectrum for smart transport applications, creating a legal foundation for V2X networks across the subcontinent. India's National Logistics Policy is built around four interconnected areas. The first is the creation of a single platform that integrates data from all participants in the chain, from customs authorities to warehouses. The second is the integration of digital systems: 30 different systems from seven government departments, including road transport, railways, customs, aviation and trade departments, are already connected to the platform. The third is the simplification of procedures to reduce cargo processing times. The fourth is the continuous improvement of the system based on analysis of its operation. Together, these components turn disparate data into a single flow that makes it possible to track cargo in real time, predict delays and make decisions without bureaucratic delays.

The UAE is implementing the National Strategy for Intelligent Mobility by creating integrated command and control centres. The Ministry of Energy and Infrastructure is coordinating the deployment of the Abu Dhabi–Dubai corridor, where robotaxis and autonomous lorries operate within a single digital framework.

Photo: Natthaphong Srisawang / iStock

At the same time, autonomous technologies are developing in agriculture. The Brazilian Agency for Industrial Development is recording growing investment in the digitalisation of agricultural machinery. Drones and autonomous tractors are already operating in the fields of the states of Mato Grosso and Sao Paulo. High-precision digital maps are being created that can compensate for deficiencies in physical road markings. Despite Brazil's successes in the agribusiness sector, the level of agricultural mechanisation remains relatively low, and a significant share of production is carried out by small farms using manual labour, creating direct demand for the deployment of autonomous technologies and automation both in the field and during transportation.

The role of logistics partnerships is changing. Companies need not simply a carrier that can quote a rate and delivery time but an operator that manages the entire chain: identifies risks before shipment, checks documents, understands regulatory requirements, can work with alternative routes and manages risks. As controls are tightened and mandatory labelling, traceability and digital data exchange expand, the operational burden on businesses is increasing, requiring them to cross-check documents in advance, verify transaction parties, assess routes and prepare contingency scenarios.

Infrastructure for connected and autonomous transport

The key technological direction is the integration of vehicles with digital infrastructure. Autonomous transport is ceasing to be an isolated solution and is becoming part of an integrated system interacting with the road network, logistics platforms and control centres.

Data on road conditions, route congestion, weather conditions and potential risks is transmitted in real time, making it possible to optimise routes, reduce accident rates and increase infrastructure throughput without a proportional increase in the size of the transport fleet.

According to Alexander Titov, autonomous transport must be integrated with warehouse management systems, companies' ERP platforms, port terminals and digital services of customs authorities.

Such synchronisation makes it possible to minimise vehicle downtime and accelerate the entire logistics chain.

The cost of an import error has risen significantly. An incorrect Foreign Economic Activity (FEA) commodity code, an inaccuracy in an invoice or a discrepancy in the description of goods – none of these are merely "technical paperwork issue” any longer but can result in downtime, storage, inspection, declaration amendments and additional payments.

For companies dependent on regular supplies, such an error can cost more than the logistics itself. It is precisely at this point – at the intersection of documents, cargo and control – that digitalisation becomes not merely a convenience but a necessary condition for ensuring that autonomous transport does not encounter bureaucratic barriers.

Automation models in BRICS countries

The deployment of autonomous transport in BRICS countries is developing unevenly and reflects the characteristics of their economic models. The common goal for the BRICS countries – reducing the cost of moving goods – is being pursued through different national approaches.

“The exchange of large AI foundation models and localised transport datasets enables operators to train autonomous transport systems to cope with different patterns of driver behaviour, complex urban conditions and changing weather conditions in different countries, without forcing individual logistics companies to bear prohibitive R&D costs,” Alexander Titov commented.

China's model is the most extensive. The PRC's autonomous transport market is estimated by national sources at tens of billions of dollars. Robotaxis in Beijing's Yizhuang area and Wuhan are operating commercially. Autonomous lorries run between logistics hubs. Smart ports in Shanghai and Tianjin process containers without human involvement, integrating maritime, rail and road transport into a seamless digital chain. The PRC accounts for around 70 per cent of trade in the BRICS region, making the automation of its logistics hubs a factor affecting the entire trading group.

India's automation model is centred on safety. In 2024, the government introduced mandatory ADAS equipment for new commercial vehicles. These technologies warn drivers of danger and can automatically brake, keep vehicles in their lanes or maintain a safe distance.

Priority is given to freight and passenger transport – precisely these segments determine the cost of moving goods and labour. At the same time, the government is stimulating the development of warehousing infrastructure: warehouses are being granted infrastructure status, providing access to preferential financing and foreign investment.

A separate area is the creation of a new National Digital High-Precision Map. Unlike countries with well-developed road markings, the quality of road surfaces and markings in India varies considerably from state to state. Therefore, the map is being created not on the basis of visual markings but using satellite data and sensors – it is becoming a “digital twin” of the roads, more stable than the physical road surface.

The UAE model is a regulatory benchmark. The target set at the government level is to increase the share of autonomous journeys to 25 per cent by 2030. The Abu Dhabi–Dubai Smart Corridor operates as a testbed for robotaxis and lorries. A precedent-setting legal framework regulating liability in accidents involving artificial intelligence has been adopted, removing the main barrier to scaling up: investors gain a predictable legal environment.

Brazil's model is one of agrologistics convergence, where automation addresses not an abstract task but a specific one: how to transport a record harvest through ports that are already operating at the limits of their capacity. Testing of autonomous lorries has begun. Their task is to synchronise movements with port operating schedules in order to reduce downtime and increase throughput. Autonomous agricultural machinery in the fields and autonomous transport on the “field – grain elevator – port” route create an end-to-end chain in which every operation – from harvesting to loading onto a vessel – is managed by a digital system. This makes it possible to reduce losses, which are traditionally high in agricultural logistics due to human error and a lack of coordination between stages. Brazil's main difficulty is not only technological but also infrastructural and competitive: the distance of key agricultural regions from ports and competition from MERCOSUR countries, with which Brazil has a preferential trade regime.

Photo: metamorworks / iStock

Russia's model is mainline-transit-orientated. Unlike other BRICS countries, Russia is focusing not on port or urban automation but on the transit potential of its territory. The key project is the International North–South Transport Corridor, where test shipments of autonomous lorries have already been carried out on the Novorossiysk–Mundra (India) and Novorossiysk–Jebel Ali (UAE) routes.

Lubarto Sartoyo emphasises Russia's systemic, long-term proposals for BRICS countries: its role as a bridge between Asia and Europe; unique expertise in transport under challenging climatic conditions, such as the Northern Sea Route with year-round navigation; and the potential to expand railway capacity. The technological package includes high-precision GLONASS navigation, IT solutions and software for autonomous vehicles, dispatching and the digitalisation of logistics platforms. “Thus, it can be said that Russia meets the BRICS countries' need for reliable, irreplaceable arteries resilient to climate conditions and offers ready-made digital solutions for integrating transport systems,” the expert asserts.

South Africa's model addresses the challenge of transport isolation. Autonomous transport in the country performs both economic and social-infrastructure functions. Cargo drones are being tested by the South African Civil Aviation Authority under BVLOS conditions – beyond the operator's visual line of sight. Their task is to create logistical connectivity where none has previously existed: in remote areas that the road network does not physically reach. This involves delivering medicines, diagnostic samples and commercial cargo to regions where conventional transport is either too expensive or impossible.

For South Africa, where the infrastructure gap between provinces remains one of the key structural problems, drone logistics is becoming not a technological experiment but a pragmatic solution. This approach differs from all other BRICS models: here, autonomous transport does not optimise existing flows but creates new ones. This is precisely why the South African case is important for the entire group – it shows that autonomy can be not only a tool for efficiency but also a tool for connectivity.

All models are aimed at a single outcome: the cost of moving cargo must fall.

Shift in the investment model

Within the BRICS countries, a sustained shift in investment flows is taking shape. Whereas previously the bulk of investment was directed towards physical transport infrastructure, the share of investment in the digital logistics environment is now growing: data transmission networks, monitoring systems, information processing centres, intelligent management platforms and predictive analytics. In effect, a new category of infrastructure is emerging – a digital logistics system as an asset in its own right.

The financial foundation of this process is the New Development Bank (NDB). In 2025, the bank raised US$1.25 billion through a bond issue with a yield of 4.375 per cent and CNY 25 billion (US$3.71 billion) through five series of panda bonds with yields ranging from 1.7 to 2.26 per cent. The share of projects with a digital transport infrastructure component in the bank's portfolio is steadily increasing. Indonesia plans to contribute US$1 billion to the NDB in order to join and gain access to financing for projects in green energy, digital transformation and infrastructure.

At the same time, sovereign wealth funds from the Gulf states, Brazil's public-private partnership mechanisms and the PRC's infrastructure programmes are entering the infrastructure sector. The BRICS investment forum held in the UAE in 2025 launched projects worth approximately US$9 billion. The main flow of capital is being directed towards the development of data transmission networks, information processing centres and sensor equipment for highways.

A key element of the BRICS financial architecture is the development of independent payment mechanisms: the BRICS international payment platform, an interbank settlement system in national currencies, and the expanded use of the yuan, rupee, real and rouble in mutual trade.

This enables the member countries to reduce transaction costs and accelerate settlements between participants.

Cross-border integration of transport corridors

The next stage in the development of autonomous transport is the integration of national systems into unified cross-border corridors. This involves creating interconnected routes between BRICS countries, where transport flows must remain continuous when crossing borders.

The International North–South Transport Corridor, linking Russia, Iran and India, will require common data-exchange standards between autonomous vehicles and the infrastructure of participating countries.

Construction of the Rasht–Astara railway line (162 km) in Iran will enable the transportation of at least 15 million tonnes of cargo a year and reduce the journey time from Ust-Luga to Bandar Abbas from 35–40 to 15–20 days.

Transport corridors in the Middle East, where the UAE acts as a hub, connect with African and South Asian routes. Promising areas of cooperation between Russia, Iran and the UAE include transport and logistics projects, including the development of the North–South International Transport Corridor and joint investment in port infrastructure.

Brazil's port routes converge on Asian consumers. China is the main buyer of Brazilian agricultural goods, accounting for 30.8 per cent of exports in 2024. In 2024, Brazil's exports to Egypt recorded the most significant growth (+91.5 per cent), demonstrating the dynamics of trade-flow reorientation and creating a need for flexible logistics solutions.

Reducing transit times and logistics costs becomes a direct trade multiplier: strategic routes that save time increase competitiveness and expand trade turnover.

The launch of the SSTL programme between the PRC and South Africa is an example of practical integration. This is the first such project in BRICS, creating a “green corridor” for trade: if cargo has passed inspection in the PRC, South African customs does not conduct a repeat inspection. This synchronisation of customs procedures reduces processing times by more than 60 per cent. The example clearly demonstrates that the economic effect of autonomous transport will be fully realised only when digitalisation covers not only transport but also all control procedures at borders.

However, the key constraint remains the absence of unified digital standards, differences in customs procedures and incompatibility between data management systems. Without addressing these issues, the effect of automation remains localised and does not become a factor in the systemic growth of mutual trade.

“Without a single common digital standard, the deployment of autonomous transport solutions within BRICS+ will lead to the emergence of localised ‘islands of automation’ – highly efficient internal corridors that come to a halt when they encounter international borders. The main obstacle within BRICS+ is not a lack of digitalisation but the high degree of development and the differences between existing national platforms,” Alexander Titov commented. According to him, the solution could be a common set of open data-exchange protocols while preserving each country's digital sovereignty.

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Logistics as a supply management system

Modern logistics within BRICS is gradually transforming from a transport process into a supply management system. The key parameters are route predictability, transparency of cargo movements and risk management at every stage of the chain.

The cost of an error – in documentation, routing or supply-chain participants – is becoming comparable to transport costs and, in some cases, exceeds them. Cargo may physically be in the destination country but remain inaccessible to the business. At this point, it becomes clear: the delivery does not end at the port or at the border, but when the goods have been legally released and can be used or sold.

The evolution of BRICS reflects a transition from a dialogue mechanism for coordinating positions to the formation of a fully fledged platform for economic cooperation, where participating countries develop their own standards for trade, logistics and financial interaction. One example of such coordination is cooperation between Russia and Brazil in IT, cybersecurity, artificial intelligence and projects for the digitalisation of urban environments and public administration – these areas are directly linked to the development of infrastructure for autonomous transport and the creation of a unified digital framework for supply management.

Economic effects for BRICS countries

The deployment of autonomous transport generates a comprehensive macroeconomic effect. Lower logistics costs accelerate capital turnover and increase trade efficiency. Greater predictability of supply chains reduces business operating risks. Reducing the share of logistics in the final price of products strengthens export competitiveness and lowers inflation.

The development of common BRICS standards for autonomous systems is moving from the technical sphere into the realm of trade compatibility. If the North–South Corridor, PRC–Central Asia routes and African transport networks operate on incompatible protocols, the savings from automation will disappear at the points of connection. Harmonisation of standards is not a bureaucratic procedure but a prerequisite for realising the economic potential of autonomous transport for the group as a whole.

Autonomous transport in BRICS countries is becoming an element of next-generation economic infrastructure. Its key function is to create a predictable, manageable and integrated logistics system that will form the basis of a new architecture of trade within the group.

In the coming years, BRICS countries will need to accelerate the movement of goods, reduce logistics costs and increase the efficiency of international transport corridors. This will be achieved not through the mass replacement of vehicle fleets, but through the adoption of artificial intelligence, data analysis and digital transport technologies integrated into existing infrastructure.

Article prepared by Vakhit Niyazov.