The products you see at the grocery store, in malls, and on websites—from luxury international brands to clothes—are stocked before they reach you. This is possible due to the logistical miracle of the present era. Jumbo trucks, long trains, massive ships, and booming planes carrying cargo—they’re the backbone of this world. According to recent research by the India Brand Equity Foundation (IBEF), annual investments in the Indian logistics industry are expected to exceed $500 billion by 2025. While all of this is exciting news, the Indian logistics sector still has to deal with issues, including transportation, a lack of particular skill sets and demanding needs. The COVID-19 epidemic has also had a substantial effect on the logistics sector over the past year. Overcoming these obstacles could significantly enhance the existing state and growth rates of the logistics sector. This is where the National Logistics Policy (NLP) will hopefully make a difference. In order to understand the National Logistics Policy, we first need to understand the requirements of this policy in the Indian logistics sector. 1. Poor Transportation Infrastructure There are four primary ways to move cargo: by land, by rail, by sea (coastal shipping), and by air. If you compare the cost of transporting one metal ton of goods in India, you will find that it costs Rs.18 per metric ton per kilometer by air, Rs.3.6 by road, and rail is by far the most economical mode of transport, at just Rs.1.6 per metric ton per kilometer. So it would seem that a significant chunk of goods would be transported by rail, but only 17.5% of goods are transported by rail in India, compared to about 71% by road. Similar to this, only a tiny part of the trade is conducted via waterways. That’s because there aren’t enough rails to handle the demand for the number of goods transported across India. Secondly, in India, both passenger and freight trains travel on the same track, with the passenger trains receiving a higher priority than the freight trains, which leads to delays. Thirdly, you must choose multimodal transport for last-mile and first-mile connectivity when you need to ship something by rail. In other words, a truck will need to transport your product from the factory to the train, unload and load it, have it shipped to a specific area, and then be picked up by another truck and delivered to your warehouse. For this reason, the majority of businesses choose road transportation over rail, relying solely on trucks. 2. Unskilled Workers The shortage of trained personnel is one of the primary issues confronting the logistics sector. As of March 2019, only 4.69% of the hired manpower was thought to be suitably skilled. The rest was made up of people who were either totally untrained or merely somewhat skilled. This implies that the industry is reduced to utilising any available labour. The government is looking at possibilities like delivering rigorous training sessions and more remuneration to educate these unskilled and partially skilled workers. It also suggests utilising more automation and technology to increase process speed and efficiency. 3. Bharat Stage Emission Standards The national logistics policy also emphasises the significance of moving to more ecologically friendly transportation methods, such as using cleaner fuels and developing new norms and laws to track emissions, waste, and noise. One such endeavour is the Bharat Stage Emission Standards (BSES). Six standards, designated from BS I to BS VI, are currently included in the BSES. Starting on April 1, 2020, BS VI became a requirement for all national auto dealers. Several modifications are introduced by this new implementation, including: 1. ULSF, a special fuel with sulphur levels below 10 ppm, is used in BS VI cars. There aren’t many refineries in India that produce this kind of fuel because it is a new need, so current refineries may have to start producing it themselves. It could require pricey new equipment for this. 2. ULSF is anticipated to cost more than current prices for gasoline and diesel due to the additional manufacturing effort this fuel requires. The NLP is geared toward the goal of lowering the carbon footprint of supply chains that work with the logistics sector, even though putting these new improvements into place would demand a larger investment. What is NLP? NLP is a government initiative with the primary goal of enhancing the flow of products throughout the nation. The policy is still being developed, but from the portions that have already been made public, we can piece together the challenges that NLP will impact. The key objectives of the policy are: a) Integration: To promote inter-modality and multi-modality by integrating processes, digital systems, policies, plans, and legislative requirements seamlessly. b) Optimization: To promote and ensure the best use of logistics infrastructure, assets, and facilities through synergistic use. c) Standardization: In the logistics sector, standardising physical assets, processes, taxonomy, and service quality standards. d) Modernization: To encourage greater use of information and communication technology, upgraded infrastructure, the use of drones, automation, innovation, green logistics, international standards, and easier integration into the global value chain. e) Formalisation: To reduce sector fragmentation, promote excellence, mainstream logistics in higher education, upskill and reskill of the existing workforce. f) Democratization: Promoting inclusivity by addressing logistics supply and user needs (agriculture and manufacturing sectors, as well as internal and external trade) and encouraging public-private participation. 4 Major Steps Under the National Logistics Policy ● Integration of Digital Systems (IDS): It is a software and web development company established in 1991, dedicated to developing solutions tailored to the needs of private enterprises and public bodies. NLP introduces an integrated digital system (IDS) that will consolidate departments from the ministries of road transport, railways, customs, aviation, foreign trade, and commerce onto a single platform. All these departments have their own digital data, which will be integrated under IDS. India will integrate 30 systems belonging to seven different ministries to create an integrated digital logistics system for faster, cheaper, and safer logistics services. This
