Change Policy To Lower Logistics Costs

Even as country’s first national Time Release Study (TRS) is conducted to measure the efficiency and effectiveness of international trade flows, the Express Industry Council of India has demanded a change in National Logistics Policy to ensure reduction in air cargo delivery costs, reports Tirthankar Ghosh

- Tirthankar Ghosh

The Express Industry Council of India (EICI), the apex body comprising Blue Dart, DHL, FedEx, Aramex, UPS, DTDC, First Flight and GATI among others, is concerned with the high logistics costs. In a recent move, the body has justifiably pointed out to the government that logistics costs would not come down if the policy was not amended. The National Logistics Policy, 2018, was drafted by the government’s Department of Commerce’s Logistics Division in February this year. The department also simultaneously decided to create an ‘IT backbone’ to develop the National Logistics Information Portal which would serve as an online marketplace for logistics service providers, buyers, government agencies (Customs, railways, ports, waterways, coastal shipping) etc. The draft policy maintains that “an efficient and reliable logistics network coupled with a transparent and consistent cross border trade facilitation process is a key driver of export competitiveness in the country”. It goes on to point out that an efficient logistics ecosystem would also encourage investments in the country, especially Foreign Direct Investment and would in turn positively impact international trade.

The draft national logistics policy aims to reduce the logistics costs from 13-14 per cent of GDP to 10 per cent “in line with best-in-class global standards”. And, since EICI represented both national and international express entities, it wanted the logistics department of the government to focus specifically on reducing logistics costs in air cargo delivery.