By Ishita Sethi
Abstract
The introduction of India’s National Logistics Policy seeks to establish a single point of contact for all logistics-related and trade facilitation-related issues. The goal of the policy is to update India’s logistics system and lower it. It is currently one of the highest expenses in the world. The policy calls for steps to improve infrastructure, including the building of new motorways, the growth of logistics parks, and the creation of multimodal hubs. It also asks for the development of a National Logistics e-marketplace, which would offer a platform for interaction and business transactions amongst all logistics stakeholders.
The logistics sector in India plays a crucial role in the country’s economic development, as it enables the movement of goods and services within the country and internationally. The Government of India has recognized the importance of the logistics sector and has implemented several policies and initiatives to improve and modernize the sector. The National Logistics Policy of India was announced by the Government of India in 2018 with the aim of improving the efficiency and competitiveness of the logistics sector in the country.
I. Targets
The targets of the Policy are as follows:
1. By 2030, India’s logistics costs should be equivalent to global standards.
2. Attempt to rank among the top 25 countries by 2030 according to the Logistics Performance Index.
3. Design a decision-support system based on data for a successful logistics ecosystem.
II. Comprehensive Logistics Action Plan
The policy shall be implemented through the Comprehensive Logistics Action Plan (CLAP). The interventions proposed under CLAP are divided into eight key action areas:
1. Integrated Digital Logistics Systems
In order to integrate multiple data sources and give logistics stakeholders cross-sector use cases, the Logistics Policy will develop a system of unified logistics interface, as aforementioned.
2. Standardisation of physical assets and benchmarking of service quality standards
In logistics, standardising physical assets and comparing service quality benchmarks can improve interoperability, lower handling hazards, streamline operations, and make commercial transactions simpler.
3. Logistics Human Resources Development and Capacity Building
To address concerns with skill development and internal capacity building in the pertinent sector, construct an overarching logistics human resource strategy and, in accordance with its guiding principles, implement action plans.
4. State Engagement
Encourage the development of local and state-level logistics plans. Create institutional structures to guide state and local government activities. State acts are evaluated and ranked.
5. EXIM (Export-Import) Logistics
Build a strong, reliable logistics network to increase trade competitiveness and advance India’s integration into regional and global value chains.
6. Service Improvement framework
Improving the regulatory interface to promote formalisation, interoperability, and standardisation
7. Sectoral Plan for Efficient Logistics
According to PM GatiShakti, Sectoral Plans for Efficient Logistics (SPEL) with the guiding concepts of interoperability, robustness, sustainability, and innovation would be developed for each sector.
SPEL would address issues with infrastructure, procedure, digital developments, policy and regulatory changes, capacity building for a better workforce, and logistical issues.
8. Facilitation of Development of Logistics Parks
Storage, handling, value addition, intermodal transfers, and other supply chain intermediary functions that are connected by a transportation network are centralised at logistics parks, such as multi-modal logistics parks, air freight stations, inland container depots, container freight stations, cargo terminals, etc.
Standardisation of physical assets and benchmarking of service quality standards:
An essential component of the nation’s entire logistics industry is warehousing and related assets. “Standardisation” is becoming a need in the value chains of warehousing to boost productivity, save costs, guarantee worldwide compatibility, and maintain competitiveness. Even though there are several general infrastructure design and operational standards published in India, facility operators, owners, developers, and regulatory bodies face a problem in spreading knowledge about applicable warehousing-specific standards. Thus, it was deemed necessary to compile current standards and international best practices into an electronic guide for simple access by the industry. Indian government officials from the Ministry of Commerce and Industry’s Logistics Division and a team of specialists from the business sector compiled the nation’s current norms and best practices.
Based on consumption patterns, the market may be divided into single and co-warehousing sectors, both of which are certain to gain from private sector experience. Through 2025, the co-warehousing category, which predominantly operates in the private sector, is anticipated to have considerable market expansion. This can be attributed to the increased preference for co-warehousing among manufacturers, suppliers, logistic businesses, and start-ups as well as the rising need for last-mile distribution. By opening up the industry to private investments and assuring the relevance of the benefits to be garnered from private players’ contributions, the India warehousing market, estimated at USD 14.65 billion in 2019, is predicted to develop at a CAGR of 9.82% to reach USD19.53 billion by 2025.
The creation of a reliable and economical logistics environment has been given top priority by the Indian government. To realise this objective, the logistics section of the DPIIT, Ministry of Commerce & Industry, conducts an annual study called “Logistics Ease Across Different States (LEADS)” in all the States and UTs to evaluate and recommend different changes to the nation’s logistics industry. In order to understand the “enabler” and “impediments” to the logistics ecosystem in the nation, the LEADS survey analyses the perspectives of various users and stakeholders across the value chain (Shippers, Terminal Infrastructure Service Providers, Logistics Service Providers, Transporters, and Government agencies).
An important component of the framework is anecdotal evidence (gathered via industry interactions), which will be used as a guide to comprehend the main problems and difficulties experienced by the industry stakeholder. The yearly survey processes data from stakeholders and States/UTs, and using a statistical model, rates the logistics ecosystem of each State/UT based on perception inputs and objective statistics for the individual States/UTs.
The three pillars of Infrastructure, Services, and Operating & Regulatory Environment are the emphasis of LEADS. Infrastructure includes five metrics that measure the effectiveness of the available logistical infrastructure. Services include nine indicators for timeliness (transportation and terminal services), safety and security (transportation and terminal services), and accessibility to mobile/internet connectivity. Services also include indications for freight prices and terminal services. Three variables linked to the level of assistance provided by the State/UT, the simplicity of acquiring necessary permissions, and finally the effectiveness of regulatory services make up the operational and regulatory environment.
III. Unified Logistics Interface Platform
Unified Logistics Interface Platform (ULIP) has been identified as a promising initiative that has been conceptualised to provide an integrated platform that can be used effectively by the stakeholders to enhance efficiency, utilise technology, and lower the cost of logistics in India. This initiative aims to achieve an “AtmanirbharBharat” in the logistics sector. ULIP was chosen as one of the seven initiatives under the “Technology Commons” initiative, which, in accordance with the vision of the Hon’ble Prime Minister, leverages technology in specifically identified priority areas by developing world-class products and services that incorporate important user and stakeholder requirements.
Utilising the Logistics Data Bank Project of National Industrial Corridor Development (NICDC), ULIP was created. It is consistent with PM GatiShakti’s overarching goal, which is to break down organisational barriers, encourage integration across multiple Ministries and Departments, and provide a single window, bringing efficiency and transparency to the logistics sector and enabling India to compete on price. This platform will be used by several government and corporate organisations, service providers, shippers, consignees, etc. to enable confidential information sharing amongst all stakeholders in real-time or nearly real-time. The ULIP initiative will transform the logistics industry in India by addressing the problems caused by manual labour and slow procedures.
The open-source ULIP platform combines the systems of several stakeholders and operates on a request-response basis. The integration layer, governance layer, and presentation layer make up the platform’s three-tier structure. Between the data source and the user of the data, Integration Layer serves as a link. While the Governance Layer supports the Policy Makers in making decisions and ensuring compliance. Promotions are made for private sector companies with the aim of establishing a Presentation Layer, which will serve as an interaction with the end user.
30 logistics systems from 07 Ministries/Departments encompassing more than 1600 sectors have been connected with ULIP using 102 APIs under the Integration layer and the Governance layer. The goal is to develop a UPI-like framework that will allow the logistic department’s transactions to all be authorised. The private sector will be utilised in the development of the Presentation layer.
Benefits of ULIP to the government authorities
· As a planning tool for setting priorities and developing a logistical infrastructure, support.
· A solid information and process framework to boost global competitiveness.
· Support inter-ministry and inter-agency interactions while advancing corporate efficiency.
· Promote improved communication between the parties involved, which will promote optimal use of the many forms of transportation that are available.
· Assistance with “Just-In-Time” inventory management and support for informed decision-making.
· Monitoring of cargo movement and processes in real-time on a single platform.
· Finding less expensive logistical methods.
· Information source for determining transportation demand.
· Truckers will be able to cut down on waiting times and empty movement thanks to openness and visibility, which will save operating and maintenance costs.
Benefit of ULIP to Logistic Service Providers
· Support stakeholders in their efforts to streamline the laborious paperwork process.
· Make a variety of value-added services available to end users.
· Assisting stakeholders in cost and labour optimization and information-driven pricing strategy.
IV. Conclusion
National Logistics Policy would promote the creation of a unified regulatory framework and institutional structure managing the sector in order to build multi-modal logistics parks (MMLPs) as key markets. This will lead to faster first- and last-mile connections, and as logistics develops, so will manufacturing, cold storage, and other sectors like export-import. Additionally, the National Logistics Policy will provide prosperity to the entire nation, reduce logistics costs, increase international trade, assist India in becoming “Atmanirbhar,” or self-sufficient, and provide new opportunities for our entrepreneurs. The scheme would tremendously help the nation’s farmers by allowing them to market their goods more rapidly, reduce waste, and eliminate needless delays, all of which would result in cheaper pricing overall.
About the Author
Written by Ishita Sethi, a second-year law student at Jindal Global Law School
Image Source: JagranJosh
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