Deployment of Logistics Databank System (LDB) has improved performance of the logistics chain in India
Use of technology has begun reflecting in the performance of the logistics chain, with shipment, warehousing and cargo consolidation witnessing improved dwell time over the last six months. Instrumental in this process has been the Logistics Databank System (LDB), a flagship technology solution of DMICDC Logistics Data Services, a special purpose vehicle of the National Industrial Corridor Development and Implementation Trust (NICDIT), a government entity, and Japan’s NEC Corporation.
Dwell time, the time taken for exports to be loaded onto a ship and imports onto a truck or train, has a direct impact on terminal congestion, besides the storage charges cargo owners pay to the port authorities. With respect to shipping, overall dwell time in January, 2018 at JNPT’s five terminals saw an improvement of 29% over December last year. This was the result of a reduction in export cycle dwell time for both truck-and train-bound containers.
Rohit Chaturvedi, CEO of TransportHub.in, says that with the use of radio frequency identification (RFID) technology, LDB provides a near real-time digital visibility on container movement. “LDB is an internet of things (IoT), big data and cloud-based solution that provides users a single window interface to check the location of the container along its entire journey, from ports to inland container depots (ICDs) and container freight stations (CFSs),” he says.
Following its launch in December, 2017 and implementation at ports on the western corridor, the service is now being extended to three ports on the southern corridor — Krishnapatnam, Kattupalli and Ennore, as well as at JNPT’s new terminal, Bharat Mumbai Container Terminal Pvt Ltd.
Real-time tracking has helped reduce dwell time for cargo at ICDs and CFSs as well. Dwell time at ICDs and CFSs on the western corridor has gone down by 26.7%. For import-bound containers, it has improved by 42.86% while for export-bound containers, the figure is 15%. LDB analysis has also helped reduce transit time from ports to CFSs by around 12%.
In what may reduce the cost of logistics significantly, RFID sealing tags are also likely to be used at the manufacturer’s site for factory-stuffed exports. Even with respect to the domestic express industry which comprises shipments transported and delivered within India, technology is emerging as a key driver. According to Vijay Kumar, COO, Express Industry Council of India, technological advance has led to automation of critical functions such as tracking, scheduling, and handling of consumer conversations.
He says, “the industry is now poised to make significant investments in infrastructure, technology, data analytics, security and automation. In fact, by providing logistics links to customers, express providers today play the role of an enabler. They help businesses reach out to their customers and partners by providing simplified and reliable shipment services, using technology.”
To be sure, the technology is still at early stages of development. Although it has penetrated the sector, it only helps post facto in its present form, Chaturvedi avers. The use of internet of things for preventive measures has not been adopted by companies yet. He also warns that IoT-based systems need to be protected from malicious attacks as an unprotected system can expose entire logistics chains to vulnerabilities.
All the same, once fully operationalised, the technology is expected to minimise the cost of logistics as well as streamline operations. Significantly, at around 13-15% of total product cost — the developed world’s average is 6%, with the figure at 8-10% for China — high logistics costs in India place its products at a disadvantage in the global market. Aiming to reduce it, the Centre recently granted the logistics sector infrastructure status. Recent initiatives have seen India’s ranking on the World Bank’s Logistics Performance Index (LPI) improve from 54 in 2014 to 35 in 2016.