The bold initiative to clean up India’s logistical mess
The logistics sector in India is undergoing a significant shift right now, and on September 17 when Prime Minister Narendra Modi is expected to announce the National Logistics Policy, this sector’s exponential growth will accelerate further. The coverage’s objective is to make it easier for goods to move continuously throughout India. For the first time, the policy is highlighted in the Union Budget 2020.
To improve and streamline India’s logistics sector, the Policy will provide a primary increase to the quarter. The coverage’s projected focus areas include procedural re-engineering, digitalization, multi-modal transportation, etc. The flow is significant because high logistical costs reduce the competitiveness of domestic goods on the international market. According to Mahendra Shah, Chairman and Managing Director of V-Trans (India) Ltd., the logistical contribution to GDP in India is at 14 percent, while it is just eight percent in the advanced world.
The government has often underlined the need to lower the cost of logistics inside the United States from the current levels of 13–14% of GDP. While the logistics cost is around 7–8 cents percent in industrialized economies. The Indian government is working to bring the cost of logistics inside the nation up to the line with sophisticated countries. The Indian logistics sector is estimated to be valued at more than $200 billion. More than 22 million people receive their livelihood from the quarter.
“With this National Logistics Policy implementation, there may also be an improvement in the integrated logistics ecosystem, a reduction in time, waste, and cost, and ensuring sustainability. It will also strengthen the warehouse sector by boosting the caliber of infrastructure, including specialized warehouses, and by expanding the capacity of warehousing by identifying areas for standardization and optimization. The national logistics strategy would provide significant cooperation among various Central government departments, agencies, and private entities. It will also ensure that the issues that drive up logistical costs are swiftly fixed in coordination with the States. According to Shah of V-Trans (India).
In the past, several efforts in this direction were made. For instance, the government unveiled the PM Gati Shakti Master Plan in October 2021, which was hailed as a revolutionary strategy for economic expansion and sustainable growth. It has seven “engines”: highways, ports, rivers, airports, mass transportation, and logistical infrastructure. In order to provide an integrated and seamless connection for the movement of people, goods, and commodities from one form of shipping to another, the government is also focusing on multimodal connectivity. To reduce the cost of logistics, the government presently accepted the upgrading of 35 New Multi-Modal Logistics Parks under Bharat Mala Pariyojana.
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