Prime Minister Narendra Modi will release the National Logistics Policy on September 17 to promote seamless movement of products across the country. The main objective of these policies is to reduce the cost of transporting goods and to move goods faster from one part of the country to another.
According to the government, increasing the speed of freight will help in increasing the growth rate of the economy and its expansion. The policy is likely to focus on various areas like process engineering, digitization and multi- modal transport . The move assumes significance as higher logistics costs adversely affect domestic products making them competitive in the international market.
Emphasis on reducing high cost
In this regard, an official statement issued on Friday said, the cost of logistics is high in India as compared to other developed economies, hence this policy is needed. To improve the competitiveness of Indian goods in both domestic and export markets, India It is imperative to reduce the logistics cost in The low cost of logistics improves efficiency in various sectors of the economy and encourages value addition and entrepreneurship, the statement said.
According to the statement, this policy is a comprehensive attempt to address the issues related to high cost and efficiency reduction by laying down a comprehensive inter-sectoral and multi-jurisdictional framework for the development of the entire logistics ecosystem. Under this policy, the target is to reduce the cost of logistics from about 13 percent of GDP to 7.5 percent in the coming years.
According to an estimate, a 10 percent reduction in logistics cost leads to an increase of 5 to 7 percent in exports. According to the commerce ministry, the logistics sector is quite complex, involving more than 20 government agencies, 40 participating government agencies and 37 export promotion councils.
What can be included in the policy
The key features of the policy will include integrated digital logistics system, ease of logistics, logistics related to import export and special parks. An empowered group of secretaries under PM Gatishakti will review the implementation of the policies. At the same time, a special group will consider the problems of the users. Road transport, shipping, railways, aviation, post, commerce and industry and finance ministries have been included in this policy.
How big is the logistics sector
According to the commerce ministry, 20 government agencies, 40 partner government agencies, 37 export promotion councils are involved in this sector. At the same time, it is a market worth about $ 160 billion with 10 thousand commodities. The sector includes 200 shipping agencies, 36 logistics services, 129 container depots, 168 container freight systems, IT ecosystem, banks and insurance agencies. At the same time, the sector is giving employment to 2.2 crore people.