On 21st September 2022, the Government of India launched the National Logistics Policy on the same day when 8 cheetahs were reintroduced to India (brought from Africa). This sharing of dates was planned to signify that the National Logistics Policy would make the movement of goods as fast as a Cheetah.
WHAT IS LOGISTICS
It is logistics which enables products from the production points to the consumption stage. Logistics involves planning, coordination, storage and movement of people, raw materials, inventory, equipment, etc. from one location to another. Also, it broadly includes all kinds of facilities crucial to trade, like-
- Warehouse infrastructure: for perishable and non-perishable goods
- Transportation: including road, waterway and railway transportation
- Government services: like customs and licensing
Logistics accounts for 16% of India’s GDP. However, in developed countries, it accounts for about 7 to 8% of their GDP. Logistics costs affect the competitiveness of Indian exports in a negative manner by increasing the cost of products.
WHAT IS NATIONAL LOGISTICS POLICY 2022
National Logistics Policy is an attempt to turn India into a global manufacturing hub. The policy lays down the direction for transforming India’s logistics sector. This policy focuses on the development of:
- Promotion of standards in logistics
- Better tracking mechanisms.
“New logistics Policy is a transformative road to economic growth”. The highlight of this policy is technology integration and creating a single-window e-logistics marketplace.
This will relieve the stress of shipment allocations and offer businesses an efficient supply chain. As e-commerce markets are expanding rapidly in India, this National Logistics Policy will help online businesses to grow rapidly.
At present time, logistics is providing sustenance to more than 22 million people in India. In India, road transportation, with a share of 60 percent, dominates the logistics sector.
The shift towards multimodal infrastructure with a mix of rail, shipping, road and air transport, will help in the growth of quality infrastructure and more assets, reducing the congestion on roads.
National Logistics Policy (NLP’s) Aim:
- To be at par with the global benchmark by 2030, by reducing the cost of logistics.
- To be in the top 25 countries of the Logistics Performance Index (LPI) ranking by 2030.
- To create an efficient logistics ecosystem with a data-driven decision support mechanism.
HOW THE NATIONAL LOGISTICS POLICY 2022 WILL BE IMPLEMENTED
To strengthen logistics, the government has created 4 elements of the National Logistics Policy 2022:
1. Digital Integration System:
To enable seamless and faster operations making logistics significantly more efficient.
2. Unified Logistics Interface Platform:
To bring all logistics and transport sectors under digital services into a single portal.
3. Ease of Logistics Services:
Allow industries to directly take up operative issues with government agencies for speedy resolution.
4. Comprehensive Logistics Action Plan:
Consists of integrated digital systems, standardization of assets, benchmarking service standards, improvement in human resources, capacity building and building logistics parks etc.
BENEFITS OF NATIONAL LOGISTICS POLICY 2022
- Enabling digital and seamless services will create a skilled workforce in the logistics sector.
- NLP 2022 will help states to utilize their resources better, reducing idle time and improving profitability.
- Increased export of products leads to the growth of the economy.
- Improvement of the infrastructure in the country including waterways, railways, airways, roads, inland transportation, warehouse, cold storage etc.
- Faster deliveries of products lead to the growth of companies.
- Will overcome multiple and cumbersome processes present today and enable ease of business.
Other Initiatives To Improve Logistics
National Logistics Policy 2022 aims to bring a shift in logistics and improve the current situation by:
- Reducing over-dependence on roads: about 60% in India against 25% globally.
- Increasing dependence on railways: use of railways is just 30% in India against 60% globally.
National Logistics Policy 2022 is not the first such scheme for betterment in transportation.
From time to time, the Government of India has been launching schemes. The National Logistics Policy, with the Gati Shakti Program, the Sagarmala and Bharatmala (waterways and roadways) schemes, the Dedicated Freight Corridors, etc. can be path-breaking.
India is aiming towards a $5 trillion economy and the country’s economic growth largely relies on trade. To reach the target, the focus on efficient infrastructure for the movement of goods is important. The pace that is required for India to grow exponentially, cannot be achieved through the present infrastructure.
Robust infrastructure will bring positive outcomes like environment-friendly transportation, fast delivery and cost-effectiveness, which will eventually boost exports. The mega policy vision is a way forward to a transformative logistics sector. The National logistics Policy 2022 shows that India is on the right path to providing facilities to its business sector and emerging as the next big economy in the world.