World Bank?s Logistics Performance Index (LPI)

World Bank’s Logistics Performance Index (LPI)

News: India has jumped 6 places on World Bank’s LPI. India is now ranking 38th in the 139 countries index, as a result of significant investments.
 India’s LPI was 54 in 2014 which improved to 44 in 2018.
 This ranking has improved after significant investments made in both soft and hard infrastructure as well as technology across the country.

What is Logistics Performance Index?
 The LPI is an interactive benchmarking tool developed by the World Bank Group. It helps countries identify the challenges and opportunities they face in their performance of trade logistics and what they can do to improve their performance.
 It measures the ease of establishing reliable supply chain connections and the structural factors that make it possible.
 The LPI considers 6 parameters to evaluate logistics performance, they are:
  o Customs performance
  o Consignment tracking and tracing
  o Timeliness of shipments
  o Ease of arranging shipments
  o Infrastructure quality
  o Logistics services quality

Key Findings:
 India’s rank moved up five places in infrastructure score from 52nd in 2018 to 47th in 2023.
 The ranking climbed to 22nd spot on international shipments in 2023 from 44th in 2018 and moved four places up to 48th in logistics competence.

Which factors contributed to India’s improved Logistics performance?
 PM Gati Shakti project as the National Master Plan for multimodal connectivity in October 2021 was important factor behind India’s improved performance.
 The National Logistic Policy was launched last year to ensure quick last-mile delivery, end transportrelated challenges, save time and money of the manufacturing in the logistics sector.
 The report has cited further that modernisation and digitalisation as a reason for emerging economies like India to leapfrog advanced countries
 Technology has been a critical component of India's logistics performance improvement efforts. Under a public-private partnership, the government has implemented a supply chain visibility platform, which has contributed to remarkable reductions in delays.
 NICDC Logistics Data Services Limited applies radio frequency identification tags to containers and offers consignees end-to-end tracking of their supply chain.
 According to the report, the average dwell time for containers between May and October 2022 was three days for India and Singapore, much better than some of the industrialised countries whereas the dwell time for the US was seven days and for Germany it was 10 days.

Dwell Time - Dwell time is how long a vessel spends at a specific port or terminal. It may also refer to the amount of time that a container or cargo spends at a port or terminal before being loaded onto a vessel or after being unloaded from a vessel.

 With the introduction of cargo tracking, dwell time in the eastern port of Visakhapatnam in Andhra Pradesh fell from 32.4 days in 2015 to 5.3 days in 2019.

What are the steps taken by Government to improve Infrastructure and Logistics services?

Initiatives :

  o PM Gati Shakti -National Master Plan 

  o LEADS Index by Ministry of Commerce

  o National Rail Plan

  o E-Way Bills, FASTag

  o Paperless EXIM trade process through ESanchit

  o Dedicated Freight corridors

  o Sagarmala and Bharatmala Projects

  o Multimodal logistics parks

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