How can the National Logistics Policy mitigate the logistics challenges

The National Logistics Policy was launched on 17th September 2022 as a comprehensive effort to increase efficiency of the entire logistics ecosystem in India. The ultimate goal of the policy was to address the underlying challenges in the logistics industry and reduce the current logistics cost from 14% of GDP to less than 10%.

No sooner than the policy was inaugurated by the Prime Minister of India, it was something that the logistics companies in India were looking up to. Let’s find out how exactly the comprehensive logistics action plan under the National Logistics Policy can mitigate the challenges in logistics industry:

Having an integrated digital logistics systems - The logistics industry is highly fragmented in nature. Therefore, this component of logistics policy will create a unified logistics interface system connecting various data sources. This will also provide use-cases from cross sectors for stakeholders of logistics. This will address the inefficiency issues existing in the logistics sector.

Physical assets standardization & service quality standards benchmarking - By standardization of physical assets and benchmarking service quality standards, interoperability can be increased, handling risks could be reduced, processes could be optimized by making it easier for logistics companies in India to conduct their businesses.

Enhancement of infrastructure capabilities - Sectoral Plans for Efficient Logistics (SPEL) have been created for each sector in order to enhance infrastructure and processes and provide interoperability, resilience, sustainability, and innovation. These plans would aid in tackling logistics-related challenges, build a better workforce, and bring in regulatory reforms. 

Development of logistics parks - Various multimodal logistics parks that are either under construction or in the pipeline will serve as hubs for intermediary supply chain operations such as storage, handling, inter-modal transfers, and all kind of value additions otherwise connected by a transportation network. These parks will bridge the gaps among the various supply chain processes.

Augmentation of EXIM (Export-Import) Logistics - This action area will look into boosting trade competitiveness and will work towards India’s further inclusion into world’s value chains so as to build a logistics network that is effective and dependable.

Way forward - The National Logistics Policy has set some targets for itself. By 2030, it is aiming to bring down India’s logistics costs and make it equivalent to global benchmarks. It is also striving to improve India’s rank in the Logistics Performance Index and rank it among the top 25 countries by 2030.