BY Mckinsey and Company

The

logistics network is highly concentrated. Freight transport relies excessively on roads. Around USD 45 billion is lost each year due to inefficiencies in Indias logistics. Integrated and coordinated approach in which the development of each mode railways, waterways and roads.

The logistics flow are highly concentrated. Three key components of the network account for twothirds of total freight traffic. Component 1 - Seven long-haul corridors that connect 15 high-growth clusters form the backbone of Indias logistics network. Component 2 - Over 150 medium-distance connectors that connect the corridors are key for Indias logistics network. Component 3 Over 750 last mile links23 of up to 100 km form a critical component of Indias logistics network.

 Indias

freight transport is dominated by

road.
Around

USD 45 billion is lost each year due to inefficiencies in Indias logistics.

2.5 times increase in freight traffic in the next decade will put further pressure on Indias logistics infrastructure.

 Building

the right network and ensuring flows on the right mode. Creating enablers to maximize network efficiency. Extracting more from existing assets. Allocating more investment to rail, and reallocating within road and rail.

NATIONAL INTEGRATED LOGISTICS POLICY (NILP)

Help the government reduce recurring losses to the economy and improve capital efficiency in the following three ways:

One, it could lay down the blueprint for the most efficient logistics infrastructure to support a balanced modal mix Two, it can ensure better coordination between multiple national and state-level bodies responsible for developing logistics infrastructure. And finally, it can ensure easier access to and optimal allocation of scarce resources such as investment, equipment and human resources.

Create an integrated network comprising long-distance corridors, medium-distance connectors and last mile interfaces as opposed to supporting diffused geographic development. Shift from a road-focused network to a balanced modal network that leverages rail and waterways to transport heavy throughput over long distances. Increase emphasis on improving asset efficiency, maximize output from existing assets and enhance interfaces between modes. Review the current allocation of investments between modes and re-allocate as necessary to increase the share of rail. Build flexibility in policy design and monitoring systems to track progress and to review and course correct based on changing economic conditions and trigger points..

The NILP should launch the following ten targeted programmes: Accelerating the numbers and build-outs of rail Dedicated Freight Corridors(DFCs). Strengthening coastal freight corridors. Constructing national expressways. Developing multi-modal logistics parks. Implementing a systematic roads maintenance programme. Developing a suitable talent pool. Enabling better equipment and setting common standards.