Prime Minister Narendra Modi on September 17, 2022 unveiled the National Logistics Policy to strengthen India’s trade sector. On the same day, India reintroduced cheetahs, the prime minister said luggage should run like cheetahs and stressed that logistics spending accounts for 13 to 14 percent of India’s GDP, almost double that of rich countries. In today’s article, we’ll take a look at the new National Logistics Policy and why it’s being rolled out. Also, we will discuss its benefits and features.
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National Logistics Policy 2022
First, we will understand the term “logistics”. The term “logistics” refers to a broad category of facilities that are critical to business activity. These agencies are involved in transport services for the movement of goods, storage infrastructure particularly important for the trade of perishable products (including food, fruit, and vegetables), and the efficient operation of government services that support commercial activities, such as licensing and regulation.
The National Logistics Policy was formulated to make the Indian logistics sector a key driver of economic growth. This will be achieved by enabling businesses, government agencies, and society as a whole to work better and more closely together. Research shows that logistics costs in India account for 13% of GDP. Developed countries do not have this problem. High logistics costs have weakened India’s competitiveness. Gujarat, Punjab, and Haryana top the rankings in different states. But we need a lot of improvements.
Key Highlights of New National Logistics Policy
National Logistics Policy Objectives
The objective of the policy is to create a tech-enabled, integrated, cost-effective, self-reliant, viable, and reliable logistics ecosystem in India. This will help India grow fast for everyone. With the National Logistics Policy, India will strive to bring its logistics costs down to the same level as world standards by 2030. It will also help create data-driven tools that help people make decisions to improve the logistics environment.
National Logistics Policy is a comprehensive effort to enhance efficiency of the logistics ecosystem in India. https://t.co/70ZlTMQILp
— Narendra Modi (@narendramodi) September 17, 2022
By better integrating the distribution network, the strategy will save on logistics and inventory costs, increase agility and improve responsiveness while reducing barriers. New development centers will be created with the help of the multimodal logistics park, which has identified 35 locations across the country. India hopes to achieve its goal of becoming a top 25 country in the Logistics Performance Index by 2030 if it can successfully implement its National Logistics Policy. The strategy aims to strengthen PM Modi’s Gati Shakti-National Master Plan by providing multimodal transport infrastructure for the economic zone.
Logistics Services Platform Launched
According to the National Logistics Strategy, a new online website called “E-Logistics Service – Electronic Log” has been launched. “Through this platform, industry organizations will be able to deal with any such issues directly with government entities that are causing difficulties in terms of operations and performance. A comprehensive framework has also been put in place for expeditious resolution of such issues,” Modi had to say. “
How the Government is Improving Logistics
A previous initiative and program to improve logistics were FASTag for electronic toll collection and anonymous customs inspections. The largest of these schemes is Gati Shakti. A large amount of material on national infrastructure investment has been compiled. The PM Gatishakti website has 1500 layers of national and state government data.
Ministries now have a single platform to track infrastructure projects. According to the government, the center aims to build 200 airfields, helipads, and water fields in the next four to five years, and roughly double the current 19,000km gas pipeline network.
National Logistics Policy Benefits and Features
The features and focus of the policy are as follows:
- Within 5 years, the plan should reduce logistics costs from 15% of India’s GDP to 8%. India must minimize logistical costs to boost export and domestic product efficiency. Reducing logistics costs increases efficiency across multiple industries, supporting wealth creation and entrepreneurship.
- The government aims to be in the top 25 countries in the Logistics Performance Index (LPI) by 2030.
- NLP will include a unified logistics interface platform. It consolidates shipping-related online services into one unified platform, saving exporters time and resources.
- Ease of Logistics Services will allow companies to immediately contact government agencies with questions and complaints.
- Indian logistics is unstructured but huge. The policy aims to promote the adoption of blockchain and artificial intelligence in the country and organize a large market.
- Every state in India needs a Logistics Coordinating Board. The performance of each state will be assessed annually using the LEADS Index. The central government will provide a template for improving logistics efficiency, allowing states to build their own systems.
- The department includes 20 major and 40 lower government agencies. 50 IT centers, banks, insurance companies, 37 export promotion boards, 200 shipping companies, 36 logistics services, 129 inland container yards, and 168 container freight terminals.