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Logistics mkt development strategy finally gets moving

Gunjan Pradhan Sinha & Subhash Narayan NEW DELHI

August 6 2008

THE government plans to create a council for the development of logistics sector to
enhance efficiency and reduce cost for movement of goods across the country. The
move aims to help the industry, particularly the growing retail sector. “The council
would devise and implement projects that would help in bringing down India’s
expenditure on logistics from 15% of its gross domestic product (GDP) to about 9-
10%. The proposal is in the final stage,” an official said. “While work on physical
infrastructure projects like roads, ports and highways is progressing smoothly, there
is need to streamline policy and procedures for integrated growth of the logistics
sector. The proposed development council would aim at providing valuable inputs for
the growth of the industry as well lend its direct support to the sector,” he added.
Another objective of the council is to develop an organised truck industry as about
75% of the total expenditure on logistics goes to this sector, he said. A unified
system to tackle issues like multiple toll booths, state road barriers and checkpoints
would be developed that would prevent cost and time over-runs. About two lakh
trucks are added to the domestic fleet of trucks every year. However, the country
manages to utilise only 60% of the resources due to idling at multiple check points
and toll posts in the country. The proposed council would comprise of members from
both industry and the government. It would facilitate financing of projects and
provide technical assistance to build a world-class logistics industry. It would also
give valuable policy inputs to the government for the growth of the industry, he said.
“The council will work on improving the software and procedures for the logistics
industry as a whole and provide fast means of movement of goods via road, rail, sea
and inland water. The private sector will be roped in to make the majority
investment as so as to speed up the movement of goods as well as use the existing
resources in a better manner,” the official said.