New Delhi: Prime Minister Narendra Modi will launch the National Logistics Policy on Saturday at 5:30 pm at the Vigyan Bhawan in Delhi. In a statement issued by the Prime Minister’s Office, the need for a national policy was felt since the logistics cost in India is high compared to other developed economies.


“It is imperative to reduce the logistics cost in India for improving the competitiveness of Indian goods both in domestic as well as export markets. Reduced logistics cost improves efficiency cutting across various sectors of the economy, encouraging value addition and enterprise," read the press release.


It further said that the government has put significant emphasis on improving both Ease of Doing Business and Ease of Living since 2014.


“National Logistics Policy, a comprehensive effort to address issues of high cost and inefficiency by laying down an overarching interdisciplinary, cross-sectoral and multi-jurisdictional framework for the development of the entire logistics ecosystem, is yet another step in this direction,” the statement added.


The policy is an endeavour to improve the competitiveness of Indian goods, enhance economic growth and increase employment opportunities.


“It has been the vision of the Prime Minister to develop world-class modern infrastructure through integration of all stakeholders in holistic planning and implementation so that efficiency and synergy are achieved in the execution of the project." 


What is the National Logistics Policy?


The National Logistics Policy formulated by the Commerce and Industry Ministry was first introduced by Finance Minister Nirmala Sitharam during the Budget 2020-2021 speech. She said it will clarify the roles of the Union Government, State Governments and key regulators. It will create a single window e-Logistics Market place and focus on generation of employment, and skills and making MSMEs competitive.


The policy aims to reduce the logistics cost from about 13 percent of GDP to 7.5 per cent of the GDP in the coming years. As per estimates, the worth of the Indian logistics market is over USD 200 billion. The logistics cost in India is high against 9-10 per cent in the US and Europe and 11 per cent in Japan.


Under the comprehensive plan, other major features include -- integrated digital logistics systems, a unified logistics interface platform, ease of logistics, standardisation of physical assets and benchmarking service quality standards, state engagement, human resource development and capacity building, export-import logistics, sectoral plans for efficient logistics, and facilitation of the development of logistics parks.


According to the commerce ministry, the sector is complex with more than 20 government agencies, 40 PGAs (Partner Government Agencies), 37 export promotion councils, 500 certifications, over 10,000 commodities, and a USD 160 billion market size. It also involves 200 shipping agencies, 36 logistics services, 129 ICDs (Inland Container Depots), 168 CFSs (Container Freight Stations), 50 IT ecosystems, banks and insurance agencies.


The policy includes highway development, along with Delhi – Mumbai and Chennai – Bengaluru express highways to be made in operation by 2023. Around 2500 km of access-controlled highways, 9000 km of economic corridors, 2000 km of coastal and land-port roads and 2000 km of strategic highways are to be added according to the policy. 1200 aeroplanes will be increased from the current 600.


According to the policy, there will be a single point of reference for all logistics and trade facilitation matters, at present, it is being managed by many ministries including road transport, shipping, railways, civil aviation, posts and commerce and industry, and finance.


The sector provides livelihood to more than 22 million people and improving the sector will facilitate a 10 per cent decrease in indirect logistics costs leading to the growth of 5 to 8 per cent in exports, the ministry had stated.


(With PTI inputs)