Multi-modal transport to pivot National Logistics Policy, boost export edge

Multi-modal integration along with digitisation and centre-state cooperation on the same, forms the core of the National Logistics Policy (NLP), launched by Prime Minister Narendra Modi on Saturday. In line with previous plans such as the National Rail Plan and Maritime India Vision, NLP intends to bring sweeping changes in the current costly, polluting, and congesting modal mix of Indian logistics.

It is expected to facilitate a modal shift in logistics from the current over dependence on roads (over 60 per cent share currently versus 25 per cent globally) to railways (30 per cent currently vis-a-vis 60 per cent globally) and waterways (5 per cent currently). Multi-trillion flagship projects such as Sagarmala, Bharatmala, and dedicated freight corridors are already working in this direction.

During the launch, PM Modi asserted that the reduction in logistics cost is a crucial variable in the country’s export competitiveness, and bringing existing policies in synergy with new infrastructure is a big step in that. direction. “If there is one policy that will support NLP the most, it’s the PM-GatiShakti NMP,” Modi said. “I am happy that today all states and central ministries have been integrated into the platform, and almost all departments have started working collectively. A database of various infrastructure projects by the central and state government has been prepared.”

India ranks 47th in the World Banks’ Logistics Performance Index today, with infrastructural clogs and mismatches in all three major transportation modes—roads, rail, and waterways (including ports). The plan now is to bring the cost of logistics down to single digits as a percentage of GDP from 14-18 per cent currently.

The broad contours of the policy include a comprehensive logistics action plan (CLAP), a new set of warehousing standards, a digital ease of logistics dashboard (E-LogS), and the unifield logistics interface platform (ULIP), which was so far being used by central departments on a pilot basis. “The warehousing standards aim to reduce discrepancies between warehouses across states. Currently, there are a majority of small, scattered warehouses, which is a loss-making deal for both their operators and manufacturers,” an analyst said.

Digitisation and transparent logistics visibility, if implemented properly, would benefit large scale movers such as shipping companies. “The focal push for digitisation through platforms like ULIP and E-LogS is crucial to support the designed services improvement framework in improving regulatory interoperability, standardisation of logistic processes and in bringing the entire multimodal network onto a single digital dashboard, enhancing visibility and transparency for all stakeholders,” said Rizwan Soomar, chief executive officer and managing director, DP World Subcontinent.

Experts said that it’s important for the Centre to gradually pull its levers, starting with synchronising the root of the problem through PM Gati-Shakti — planning, which until now, was happening in departmental silos.

Effective implementation of the policy would also depend on support from individual states, said Arindam Guha, Leader & partner Government & Public Sector, Deloitte India. “Critical areas such as first & last mile connectivity, transport, industrial development etc. together with associated regulatory approvals falling under States’ jurisdiction. The Centre seems to have already made considerable headway in getting their buy-in with over 15 states having announced their own logistics policies which are more or less aligned with the National Logistics Policy and also having onboarded most states on the Gati Shakti platform,” Guha said.

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