Indian Institute of Foreign Trade (IIFT), an autonomous body under the ministry of commerce and industry is developing a sector-specific index to estimate the logistics cost and bring it down to 10% of Gross domestic product (GDP) from 14%. The index that will be released early next year helps estimate the logistics cost in top nine export sectors including agriculture, leather, apparel and, gems and jewellery.
Manoj Pant, Director, Indian Institute of Foreign Trade (IIFT) told the media, “Internationally, no one has made sector-specific indices to estimate logistics costs. We have taken the top exporting sectors and will move on to domestic trade later.”
“We are getting to know about their problems such as biggest constraints in transportation and warehousing,” Pant further said.
The government is also aiming to make it to the list of top 30 countries in the World Bank Logistics Performance Index which, in 2018, ranked India 44 from 54 in 2014.
The data collection for the index which was initiated 3 months ago is collected via perception-based surveys through the respective export promotion councils.
Ajay Sahai, Director General, Federation of Indian Export Organisations said, “While the movement of goods is a major problem in most exports, temperature-controlled facilities are key for agricultural goods and pharmaceuticals. So, by and large, the issues are same for most exports.”
The index will also serve as a common measure of logistics performance for various industries and look at logistics issues of electronics, marine, chemical and engineering goods in India.
Apart from this, it will help identify cost-efficient ways of transporting goods.