Indian startup Delhivery will receive $100 million from FedEx Express, a subsidiary of delivery services behemoth, as the latter seeks to extend its footprint in the South Asian nation.

This investment comes less than two months after the $3 billion company from Gurgaon raised $277 million in preparation for an initial public offering for the upcoming quarters.

It’s said that both companies will most likely enter into a long-term commercial arrangement as part of the deal, with FedEx Express focusing on international export and import services to and from India, while Delhivery will sell FedEx Express foreign products and services in India and provide pick-up and delivery services throughout the country.

Certain assets related to FedEx's domestic business in India are expected to be transferred to Delhivery.

Delhivery flagged off as a food delivery firm that grew while having a full range of logistics services in more than 2,300 Indian cities and over 17,500 zip codes. It’s now one of a few businesses using a freight exchange platform to try to automate the logistics market's demand and supply structure.

Its platform connects shippers, agents, and drivers who provide road transportation services. The startup, according to the firm, lessens the role of brokers, improves the efficiency of certain of its assets, such as trucks, which are the most popular way of transportation for Delhivery and ensures round-the-clock operations.

It’s projected that this digitization is necessary to overcome inefficiencies in the Indian logistics industry, which have hampered the country's economy for years. In a research last month regarding India's logistics business, analysts at Bernstein said that poor demand and supply planning and forecasting raises carrying costs, theft, losses, and delays.

The TAM (total addressable market) of the Indian logistics firm is over $200 billion, according to Bernstein analysts. Late last year, the firm announced plans to invest more than $40 million over the next two years to expand and extend its fleet to fulfil the increased demand for orders as more people shop online amid the pandemic.

Delhivery is said to work with India's most high profile e-commerce companies and has been leading enterprises, as well as over 10,000 customers. Its couriers are allotted an area that never exceeds two square km for the last leg of the delivery, allowing them to make multiple delivery runs per day to save time.

With this investment, Sahil Barua, Co-founder, Delhivery said, "our goal is to provide new goods and possibilities to Indian and global businesses and consumers through unique access to our networks, technology, and engineering capabilities”.