The National Logistics Policy, unveiled by Prime Minister Narendra Modi, will further improve the ease of doing business and drastically reduce transport costs, according to Indian industry.
The policy aims to address the challenges facing the transport sector and reduce the logistics cost for businesses by 13-14% of GDP to single digits in the coming years.
“Reducing logistics costs and increasing logistics efficiency will boost the economy in all sectors in multiple ways and bring us several steps closer to emerging as a global manufacturing powerhouse,” said the CEO of CII, Chandrajit Banerjee, in a statement.
He said that in addition to improving the ease of doing business, it would help ensure faster and smoother movement of goods and people across modes of transport – water, air, roads, railways.
Sharing similar views, Assocham said the policy will significantly reduce transaction costs along the supply chain.
“Enabled by different technologies, the policy focuses on unified measures across different logistics modes, including roads, railways, ports, airports and warehousing, which will give decisive advantage to the ease of doing business in India,’ the chamber said.
Jagannarayan Padmanabhan, Director and Practice Leader – Transport and Logistics, CRISIL, said it was a holistic effort to increase efficiency in all aspects of the logistics value chain.
Over the past five fiscal years, the government has invested nearly Rs 15 lakh crore in increasing hard infrastructure such as roads, railways, ports and airports, he said.
“Its proper implementation and widespread adoption will help to structurally reduce logistics costs and make a significant difference in the growth of manufacturing and service sectors in India,” Padmanabhan said.
Arindam Guha, Manager and Partner, Government and Public Sector, Deloitte, India, said the policy represents a set of ongoing initiatives aimed at making India’s logistics sector more cost-competitive, environmentally friendly, formalized, transparent, with reduced and predictable delivery times.
He added that some of the key pillars of the policy include ensuring quality logistics infrastructure, with particular emphasis on first and last mile connectivity; and using digital technologies and analytics through initiatives such as the Unified Logistics Interface Platform to match demand and supply.
“The policy should facilitate a modal shift in logistics from the current overreliance on roads (over 60% currently compared to 25% globally) to railways (30% currently) and waterways (currently only 5%). ), thereby reducing average logistics costs as well as the carbon footprint,” he added.
It should also lead to a significant improvement in India’s ranking in global studies such as the World Bank’s Logistics Performance Index, where India was ranked 47th out of 160 countries in 2018, Guha said.
(This story has not been edited by the Devdiscourse team and is auto-generated from a syndicated feed.)