Centre taking stock of logistics costs now
Final data will be used as a baseline for carrying out comprehensive trend analysis in future
image for illustrative purpose
Cost Calculation
♦ Ministry developing survey-based framework for logistics cost calculation
♦ Armstrong & Associates estimated logistics cost at 13% of GDP
♦ NCAER puts it at 8.1%
♦ Centre announced National Logistics Policy in 2022
New Delhi: The Logistics Division of the Department for Promotion of Industry & Internal Trade (DPIIT) has initiated an exercise to estimate the total logistics cost in the country. At present, there are no official estimates available, and expert estimates fall in the wide range of 8-14 per cent of gross domestic product or GDP.
Cognizant of the need to obtain accurate estimates based on holistic data and relevant statistical models, the Ministry of Commerce & Industry has decided to initiate the exercise, official sources told Bizz Buzz.
Armstrong & Associates, a leader in third-party logistics market research and consulting, estimated the cost at 13 per cent of GDP. The prominent think-tank, the National Council of Applied Economic Research (NCAER), found it to be 8.1 per cent.
The task force constituted for the purpose comprises senior officials from the economic ministries concerned, academics, and experts from industry and think tanks. They are using secondary data available in the public domain, primarily of the Ministry of Statistics & Programme Implementation. It is developing a long-term survey-based framework for logistics cost calculation.
Once the logistics cost is available, it will be used as a baseline for carrying out comprehensive trend analysis in future, the sources said, adding that this long-term survey-based study will help in arriving at robust logistics cost estimates at a disaggregated level so that targeted interventions across sectors and modes can be undertaken.
The Narendra Modi government has been promoting infrastructure building quite determinedly. In 2021, it launched the PM GatiShakti, a GIS-enabled National Master Plan (NMP) for multi-modal connectivity. Last year, it came up with the National Logistics Policy. While the PM GatiShakti NMP addresses integrated development of the fixed infrastructure and network planning, the NLP addresses the soft infrastructure and logistics sector development aspects like process reforms, improvement in logistics services, digitisation, human resource development, and skilling.
