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Get onboarding right

Railway Agencies & service providers must get first preference for onboarding; A PLI-support orientation will help determine the corridors for immediate action.

Get onboarding right
The NIP has been supplemented by the Pradhan Mantri Gati Shakti Master Plan, a nationwide, GIS-based digital platform that captures and disseminates information on key transport linkages and projects at different stages of implementation. (IE)

Domestic and global supply chains play a key role in sectoral growth across all industries. An efficient and cost-competitive logistics network, therefore, becomes critical for the overall economic competitiveness of the country. The World Bank Global Logistics Performance Index (LPI) study ranked India 42nd out of 167 countries, based on aggregated LPI scores across four annual studies (2012, 2014, 2016 and 2018). Economies such as Germany, Netherlands, Sweden, Belgium, and Singapore featured at the top of the list, with the highest LPI scores. Some of the key areas that adversely impacted India’s overall LPI score include ‘uncertainty in delivery performance’, ‘quality of trade- & transport-related infrastructure’, and ‘relative efficiency of customs/border clearance’.

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Over the last few years, the Government has been implementing various measures to streamline logistics flows and remove bottlenecks. Key transport and logistics infrastructure in the form of roads, railways, airports, ports, coastal shipping, inland waterways, multi-modal logistics parks, air freight stations, etc, are being expanded and upgraded as part of the National Infrastructure Pipeline (NIP). The NIP has been supplemented by the Pradhan Mantri Gati Shakti Master Plan, a nationwide, GIS-based digital platform that captures and disseminates information on key transport linkages and projects at different stages of implementation. The objective is to ensure coordination across the various central and state government agencies to ensure prioritised implementation and timely completion.

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The policy/regulatory regime has also been considerably simplified and streamlined to avoid delays on the account of transit-related documentation and approvals. Starting with the implementation of a single goods & services tax (GST) regime across the country in 2017, a number of measures have been taken like reducing the number of documents required for import/ export, setting up a National Single Window platform for facilitating online approvals across multiple Government agencies, introducing e-way bills, FASTag etc. An annual study for assessing Logistics Ease Across Different States (LEADS) is also being undertaken since 2017-18 to obtain industry feedback on different aspects of logistics and identify improvement opportunities at the state level.

The recently-announced National Logistics Policy (NLP) is a culmination of all the above initiatives. It is intended to provide an overarching policy and institutional framework for streamlining the logistics sector. It aims to build on the earlier initiatives to make the logistics sector more efficient and cost-competitive, integrated, resilient, formalised, and transparent.

One of the key cornerstones of the NLP is the Unified Logistics Interface Platform (ULIP), which would essentially function as a digital e-marketplace to match demand & supply for logistics infrastructure/services and also monitor service delivery levels through online tracking & tracing.

This is being supplemented by the E-LogS digital platform, to which all participating government agencies would be connected to address user-issues/suggestions. Both these digital platforms would capture rich transaction-level data, which will be analysed to monitor logistics performance and identify improvement opportunities.

The NLP envisages adoption of globally-compatible quality standards for logistics infrastructure (warehousing etc) as well as benchmarking quality of services. The applicable standards would be notified by the relevant government agency(s) together with the supporting processes for accreditation and periodic monitoring. With the expected growth in the logistics sector likely to generate significant additional employment over the next 2-3 years, expanding and strengthening the skilling ecosystem is the other focus for the NLP.

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Implementation of the policy would need the involvement of multiple participating government agencies and other stakeholders at the central and state government level. The implementation mechanism provides for a Comprehensive Logistics Action Plan, which would be developed by the Logistics Division under the department for promotion of industry and internal trade, with inputs from all key stakeholders.

As is the case with every policy of the government, the success of the NLP would depend on how effectively it is implemented. Based on experience, three factors are likely to play a key role in implementation.

The first is prioritisation in terms of mode of transport, industry/ sector, and geographic focus. With the NLP targeting an increasing modal share of railways and waterways, the initial focus clearly would have to be on onboarding and alignment of government agencies and service providers in these sectors. Similarly, certain industries, such as those covered under the production-linked incentive (PLI) schemes, may need to be prioritised for quick results, which in turn would determine the states and transit corridors, participating government agencies to be focused on, etc.

Second, onboarding of small & medium enterprises (SMEs) on ULIP, both those providing logistics related services (transport, for example) as well as customers availing such services is an integral part of the overall NLP strategy. Accordingly, a structured outreach backed by an information, education & communication (IEC) programme needs to be launched in coordination with the states to reach out to industry associations and other relevant stakeholders to maximise participation.

Finally, coordination between central- and state-level agencies is an essential pre-requisite, which would decide the pace and effectiveness of the implementation of NLP across the country. With states playing a key role in first and last-mile connectivity infrastructure as well as providing certain logistics-related approvals, alignment between participating agencies in both tiers of government would be critical.

If the government is able to address these issues and mobilise the concerned stakeholders for quick and effective implementation, the NLP can clearly be a game changer for achieving the country’s economic aspirations.

The writer is Partner and leader (government & public services), Deloitte India

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