Integrating diverse mode of transportation for improved efficiency
India’s logistics costs are presently 14 per cent of the country’s Gross Domestic Product (GDP),similar to other developing countries but well above the global average of 8 per cent. One of the government’s initiatives to reduce the logistics costs to 8-10 per cent of India’s GDP as well as bring greater efficiencies and eliminate operational redundancies is Gati Shakti, the national master plan for multi-modal connectivity. Gati Shakti provides for the construction of 35 multimodal logistics parks (MMLP) across India to strengthen logistics and build transportation hubs in the country. These parks will serve as centres for freight aggregation, distribution, storage, warehousing, and to provide additional incentives to logistics companies such as customs clearances. The parks will also help to improve and diversify the logistics system by facilitating intermodal transportation—roads, railways and inland waterways.
In all, seven engines drive the MMLP initiative—roads, railways, airports, ports, mass transportation, waterways and logistics infrastructure. Wastewater and sewerage, energy transmission and IT communication will provide complementary support to those engines.
By helping to lower India’s logistics costs, a benchmark achieved by developed economies such as Japan and the EU, the MMLPs are expected to propel India into the league of developed nations.