What To Expect From New Logistics Policy In 2023
Prime Minister Narendra Modi launched the very ambitious National Logistics Policy on 17 September 2022, to enhance India’s trading. With India’s logistics expenditure accounting for 13 per cent of the GDP, the idea is to make the sector a key driver of economic growth. The policy aims to make India's logistics ecosystem technology-enabled, integrated, cost-effective, as well as dependable while creating and leveraging benefits of data-driven tools.
For the convenience of logistics services, the government has established a platform for industry groups to be able to directly address concerns and challenges related to operations and performance via this platform. This exercise shall allow large, medium and small enterprises in the sector to resolve hindrances quicker and efficiently.
The policy has created a lot of excitement amongst the industry players who are all keen to see the policy framework roll-out and bring Indian logistics at par with the global best. Following are some immediate benefits that the policy could bring in for us in 2023:
The policy is expected to improve the logistics performance index of India in the global market: In order to fuel the competitive spirit of the domestic enterprises in the global market, the strategy intends to cut costs by up to 25 per cent. By doing so, it will shorten transit times and lower prices, giving exporters more room to develop. India will have an improved control over the global market where larger chunk of commodities will be exported rather than imported.
Emphasis on digitalisation, the logistics ecosystem is expected to be more data-driven, cost-effective, efficient, and resilient: With cutting-edge technology, digitalization is poised to improve product availability while also increasing cost efficiency in logistics. It will also help automate tedious warehousing and manufacturing operations like never before. Real-time monitoring will be simpler as processes become digital, enabling managers to be properly informed and commit to deadlines with accuracy. Technologies such as IoT, AI, GPS and cloud et al will enhance logistics services, which will lead to an increase in available markets and trade opportunities.
The current state of India's logistics industry, which is fragmented in nature, is most likely to become more inclusive in terms of service areas and jurisdictional framework: The NLP will facilitate communication and cooperation between jurisdictions and other regional bodies. Further permitting complete risk-reduction methods, and optimising economies of scale by leveraging individual competencies and sharing expenses and resources. It will assist organisations in organising their services in support of and alignment with the government.
Emphasise multimodal connectivity for a brighter future for multimodal logistics: By collaborating with ministries such as those in charge of roads and railways throughout the integrated planning and coordinated implementation of connectivity projects, NLP seeks to create a modern infrastructure of the highest calibre. The PM Gati Shakti National Master Plan's goal of boosting multi-modal linkages would be supported by the policy.
It is anticipated to bring focus on various sustainable initiatives in the pipeline for the logistics sector: The NLP will introduce policies that directly lead to standardisation and environment-conscious technologies in long-term logistics operations. It will also encourage the use of, and transition to more environmental-friendly modes of transportation. The focus will be on developing green logistics enterprises and green logistics infrastructure.
While the government aims to make the logistics sector cost effective by bringing the changes in the sector like lowering the logistics cost from 15 per cent of India’s GDP to 8 per cent, aims to be among top 25 countries in the logistics performance index by 2030, to establish a dedicated platform for the ease of logistics services to directly connect with government agencies, to promote block chain and AI adoption in the country.
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