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Government developing new domestic index to track logistics costs in India.
Sep 16, 2022
Even as the government is preparing to unveil the National Logistics Policy on September 17, the Ministry of Commerce and Industry plans to develop a domestic index to track the logistics cost.
Sources in the ministry said it is a part of the larger policy of the government to develop a local framework to assess the logistics cost in India, as the one available currently is not providing the correct picture.
The logistics costs that the policymakers are currently following are being measured by an international agency, and according to it, in India, the logistics cost is 13-14 per cent of the GDP. The new logistics policy aims to bring this cost to 8 per cent of the GDP by 2030.
'We believe the logistics cost is lower than the often quoted figure of 13 per cent, and we believe we need to have a local system to measure the same to correctly reflect the cost incurred by logistics and transport. The current system is very ‘impressionist’,' said a commerce ministry official.
The same official said it is unfair to compare the logistics costs of a large country like India or the US with those of smaller countries.'Large countries and countries with bigger agriculture and manufacturing component in GDP will invariably have higher logistics cost,' he said.
According to the last World Bank Logistics Performance Index published in 2018, India was ranked 44th in terms of logistics performance. The new logistics policy envisages creating a Unique Logistics Interface Platform to integrate the existing 30 digital platforms developed across different ministries so as to enable real-time information to all stakeholders.
It also plans standardisation of physical assets -- like the size of containers, trucks, etc-- better engagement with states, development of logistics parks, etc. The whole policy is part of the PM Gatishakti plan launched last year.
newindianexpress.com
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