India Plans to Elevate Global Logistics Standing through LPI Examination and Reform Advocacy

In a determined effort to enhance its standing in global trade logistics, India is intensively examining the World Bank’s Logistics Performance Index (LPI). Government officials, familiar with the development, reveal that the focus is on pinpointing weaknesses and advocating for changes, to better capture and acknowledge India’s reforms in the field of supply chain.

Concerns have been raised about the existing perception-based methodology, with officials contending that it inadequately captures India’s progressive reforms, including the Logistics Data Bank and Unified Logistics Interface Platform. Furthermore, crucial details like sample size and sub-indices are not publicly available.

To address these challenges, the Department for Promotion of Industry and Internal Trade (DPIIT) plans to engage a consultancy firm to collaborate with the World Bank. The objective is to refine the methodology, ensuring it comprehensively reflects India’s logistical reforms.

Sumita Dawra, Special Secretary (Logistics) at DPIIT, announced the planned onboarding of a dedicated team of 5-6 experts. Their mission is to conduct thorough research, identifying gaps and proposing interventions across the logistics ecosystem, focusing on the six parameters of the LPI: Customs, Infrastructure, Timeliness, Ease of Arranging Shipments, Quality of Logistics Services, and Tracking & Tracing. The officials ultimately aim to create a roadmap for effective on-ground implementation to elevate India’s performance.

Most recently, India challenged the world’s perception of the country’s logistics infrastructure and performance by releasing a scientific methodology-based Logistics Cost Framework, which estimated India’s logistics cost to be between 7.8-8.9% of GDP in FY22.

India, ranked 38th in the 2023 LPI, has steadily progressed from 54th in 2014. Noteworthy advancements include a five-notch rise in infrastructure to 47th in 2023 and a leap to 22nd for international shipments in 2023 due to modernization and digitalization.

With aspirations to break into the top 25 on the LPI covering 139 countries by 2030, New Delhi emphasizes the importance of capturing key reforms like the National Logistics Policy and PM GatiShakti National Master Plan.

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