Logistics Cost in India

Logistics Cost in India

News: India's logistic costs ranged between 7.8% and 8.9% during 2021-22, down from 8.7-9.9% during 2011- 12, a report by economic think tank National Council of Applied Economic Research (NCAER) and the Department for Promotion of Industry and Internal Trade (DPIIT), recently released said.

Key findings:
• According to the report, 'Logistic Cost in India: Assessment and Long-term Framework', India's logistics costs saw a dip during 2014-15 to 2016-17, from 8.3-9.4% to 7.8-8.8%, due to a faster growth in nominal GDP than in logistic costs, and a fall in fuel prices compared to the earlier period.
• The national logistics policy will reduce the cost and enhance the competitiveness of Indian industry.
• Through the report, a framework is being developed which will be used to calculate credible logistics cost estimates.

Government initiatives in this segment
• The logistics division in the Commerce Ministry has been created.
• Logistics Efficiency Enhancement Program and Vehicle Fleet Modernization Program to improve logistics efficiency. So far, 22 states have already implemented logistics policies.
• Land Port Management System (LPMS): Digitizes operations at Integrated Check Posts (ICPs)
• FASTag-based electronic toll collection
• Gati Shakti Scheme; Bharatmala Program (building about 84,000 Km of new highways); Sagarmala Project (unlock the potential of the country’s 7,5000 Km coastline and 14,500 Km of navigable waterways); Railways: Freight corridors; e-Air WayBill (e-AWB), and e-Cargo are all initiatives taken to modernize how we handle logistics, improve road, rail, waterway and air infrastructure and minimize logistics cost with enhanced competitiveness of our products in the global market. 

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