DPIIT working towards better clarity on India’s logistics cost: Dawra

India's logistics cost

The Department for Promotion of Industry and Internal Trade (DPIIT) has been making continuous strides in the past few months towards identifying the Indian supply chain sector’s opportunities, challenges and the root causes of those challenges. During the past couple of months, the DPIIT conducted many workshops for various regions, a part of which was the regional workshop conducted last month on logistics cost framework. A task force has been set up to formulate a framework to determine the cost in the country, which is currently estimated to be between 13% to 14% of the GDP.

According to a senior official of the DPIIT, they aim to get a clear picture of the country’s logistics costs in the next four months. While the NCAER estimates the cost to be around 8%, and another estimate based on the Economic Survey puts it around 13-14%. The DPIIT appointed task force will submit their report in the next 2 months and in another 2 months or so, India’s logistics cost estimates will be revealed.

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“We have recognised the fact that we need more clarity on what are the components that will go into the logistics costs calculation. Not many countries have calculated their logistics costs. So, we are trying to bring objectivity to the calculation rather than a perception-based approach,”

Sumita Dawra, Special Secretary, DPIIT

The task force’s report will provide details about the components that are used to calculate logistics cost, post which the experts will be able to calculate the exact cost. The parameters will also be worked upon for improvement.

The task force members include representatives from Niti Aayog, the Ministry of Statistics and Programme Implementation (MOSPI), the National Council of Applied Economic Research (NCAER), academic experts and other stakeholders.

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