Logistics costs play a major role in the economic progress of a country, as it accounts for 25 per cent of the delivered costs in developing countries, while it can be as low as 7 per cent in developed countries. Logistics costs in India make up 13% of the GDP, and need to be brought down to 10 per cent in order to compete with advanced economies in Europe and countries such as the US. The importance of logistics is highlighted by the presence of 10 out of the world’s 20 top ports in China, which drive its exports since 80 per cent of global trade takes place via sea routes.
This is why India’s newly unveiled National Logistics Policy is a significant leap forward, since it will reduce the cost of logistics to 8 per cent by 2030. It will also create a data-driven decision-making system to increase efficiency for logistics. Last-mile delivery will become quicker, providing a boost for the e-commerce sector in India as well.
Industry reacts positively
Speaking about the policy, Shashi Kiran Shetty, Founder and Chairman of the Allcargo Group, said, “The launch of NLP is a visionary move by the government which will bring transparency through digital integration in addition to boosting speed and efficiency. It will enable fast-paced logistics infrastructure development, better coordination among multiple stakeholders, simplify processes and documentation and boost last-mile connectivity. The NLP will usher in more inclusive progress for our country with greater employment generation opportunities and efficient logistics services delivery, especially for small businesses
Joining him, Agendra Kumar, MD of geographic information system provider Esri India said, “The National Logistics policy (NLP) will drive the much-needed tectonic shift in the sector towards digitization, thereby transforming the entire ecosystem towards fulfilling the vision of Atmanirbhar Bharat. Technologies like Artificial Intelligence, GIS, drones and others will be instrumental in IDS- Integration of Digital System, ULIP — Unified Logistics interface Platform, SIG — System Improvement Group, the key pillars of NLP. This integration will usher in a new chapter for the logistics sector, enabling faster decision-making and roll-out of critical projects, to give a competitive push to our exports.”
Benefits spanning diverse sectors
In addition to this, the real estate sector will also witness growth with the rise in requirement for warehouses and industrial parks, to support a robust logistics sector. Tech platforms such as Unified Logistics Interface Platform and Ease of Logistics Services will help the industry to report operational issues directly with the government.
Shetty added that, “It brings a holistic approach to making India self-reliant and a global manufacturing hub. With an ambitious goal to bring down logistics costs by up to 25%, this could lead to a paradigm shift in the logistics industry in India and will boost India’s export competitiveness in the global market. The NLP will act as a guiding and driving force for the new phase of growth”
