A logistics firm wishing to access basic background information about a truck currently needs to log in to two different portals of the road ministry — Vahan and Sarathi. To track the cargo location, it has to rely on toll information gathered through FASTag of the National Highway Authority of India, or the Freight Operations Information Systems of the railways, depending on the mode of transport. It has to tap the Airport Cargo Community System, created by the civil aviation ministry, to interact with stakeholders in this value chain. To monitor the flow of goods in or out of a port, it has to get access to a terminal operating system.
All these functions and inputs, and a lot more, will now be made available to stakeholders under Unified Logistics Interface Platform (ULIP), a key feature of the National Logistics Policy launched by Prime Minister Narendra Modi on September 17 and notified on Friday.
This is important as India’s infrastructure deficit owes more to inefficient project implementation, rather than financial constraints. According to the latest official data, as many as 393 infrastructure projects, each entailing an investment of `150 crore or above, witnessed cost overruns of as much as `4.66 trillion until August. While the total original cost of 1,526 projects that are under execution was Rs 21.26 trillion, their anticipated completion cost is now likely to shoot up to `25.92 trillion, reflecting a cost overrun of almost 22%.
The country could finally get a handle on the intractable problem, thanks to PM Gati Shakti, the National Master Plan for Multi-modal Connectivity.
“As they say ‘data is the new oil’. ULIP will provide the data, which can be used for the benefit of all stakeholders. Many business ideas, too, can be built around the analysis of this data. Similarly, the data will lead to many corrective as well as proactive steps,” Amrit Lal Meena, special secretary at the logistics division of the commerce and industry ministry, told FE.
Transportation alone accounts for about 50% of the logistics cost in India, he said. With the swift flow of information and necessary counter-measures, these costs can be pruned substantially, he said.
As many as 30 different systems of seven key departments are being integrated under the ULIP through more than 100 application programming interfaces (APIs) covering 1,600 data fields. APIs are typically cloud-based intermediaries that enable applications with different designs and code to exchange data with each other. The ULIP will, thus, offer logistics firms access to a plethora of relevant data, often on a real-time basis, and enable them to swiftly make informed commercial decisions.
The policy aims to trim the country’s logistics cost to about 8% of GDP from the current 13-14% in about five years and propel the country into the league of top 25 nations in logistics performance by 2030 (India was last ranked 44th in the World Bank’s logistics performance index 2018).
It will ultimately result in faster cargo movement and reduction of costs, as a range of objectives — from tracking the cargo movement to the delivery of goods and removal of middle men in many cases — can be achieved through this platform. The departments whose data and relevant portals are integrated include road transport, railway, customs, aviation and commerce.
A company wishing to have access to the ULIP platform has to apply to the government for registration. Once it’s done, it needs to submit its use cases, which will then be reviewed based on the proposed usage of the requested data. It has to then sign a non-disclosure agreement with the government to not misuse the information.
Within two weeks of the launch of the policy, 13 organisations have signed such an agreement to access data. They are MapMyIndia, CargoExchange, Freight Fox, Conmove, Intugine, Eikonatech, Yes Bank, Superprocure, CargoShakti, CloudStrats, Shyplite, APSEZL and AITWA. Non-disclosure agreements with 11 others — including Instavans & Trucks, Bosch India, Portlinks and Shiprocket — are in the process of completion.
Through the National Logistics Policy, the government is seeking to create “a multi-modal digital connectivity” architecture that would cover data and information relating to road, rail, port and airport to ensure seamless movement of goods and services across the country, Meena said.
The logistics policy will complement the PM Gati Shakti National Master Plan, under which different departments and agencies join hands for coordinated development of critical projects.
Consider the example given by commerce and industry minister Piyush Goyal: The Jawaharlal Nehru Port Trust has had “extremely bad” connectivity for years due to “awful” design. This not just delayed the despatches of goods, but also added to logistics costs.
In essence, while GatiShakti is meant to deal with physical infrastructure to enable seamless movement of goods, services and people, the logistics policy offers a digital platform to bring in efficiency in services (processes, systems, regulatory framework) and human resource.
The new logistics policy architecture is backed by a mechanism to monitor the implementation of the ideas and to address issues flagged by stakeholders.
An inter-ministerial “Services Improvement Group” (SIG) is being set up to monitor the progress. The SIG will comprise officers nominated from key ministries, in addition to relevant members of the extant Network Planning Group, such as the ministry of housing and urban affairs and departments of revenue and commerce.
Similarly, issues flagged by various stakeholders will be addressed through the inter-ministerial mechanism for swift remedial measures. States will also be actively consulted on issues relevant to them.
A logistics data bank has been developed, which ensures container tracking for both export and import. Launched in July, it has already helped track about 50 million containers.
The renewed thrust on reducing logistics costs assumes significance, as the country aims to substantially raise its merchandise exports to $1 trillion by FY28 from $422 billion in FY22. According to an Arthur D. Little-CII report, higher logistics cost is causing a competitiveness gap of $180 billion for India, and this will likely to rise to $500 billion by 2030.