India plans common logistics portal to ease movement of goods, reduce logistics cost

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In a move to ease the transportation of goods, the government is planning a common platform integrating all transactions involved in their production and export.

The commerce department has initiated work on an integrated logistics portal or logistics e-marketplace to connect buyers with logistics service providers with all the government agencies such as customs, Port Community Systems, Sea and Air Port terminals, Shipping lines, Railways, among others. Customs department Icegate will also get integrated with the portal.

“The speed and cost of doing business depends on logistics…our new logistics division will look at this,” commerce and industry minister Suresh Prabhu said on Tuesday while signing an agreement with the Confederation of Indian Industry (CII) for cooperation in the logistics sector.

Logistics costs in India are pegged at 13-14% of the GDP are higher than those in developed countries and the government aims to reduce it to 10% by 2022. Form point of production to export, there are 64 transactions and 37 government agencies involved.

The major challenges are multiple regulatory policy regimes, no seamless movement of goods and lack of single window clearance and coordination among various stakeholders.

The World Bank Logistics Performance Index ranked India 35 in 2016 as compared to 54 in 2014.

“The finance ministry has issued an amendment to give infrastructure status to some aspects of logistics like warehousing. Therefore, we expect more investment in logistics,” said an official.

As per the MoU, CII will identify logistics challenges facing industry and suggest action solutions to the Logistics Division. It will also interact with state governments and work on promoting the logistics sector, along with capacity building programs. The two sides will cooperate in organising a National Logistics convention each year to bring together stakeholders in the sector.

Source: THE ECONOMIC TIMES