The National Highways Authority of India has constituted a subsidiary for logistics movement across the country to streamline its logistics business. It has decided to transfer the existing nine contracts to the arm and allocate the future logistics projects to this subsidiary as well.
NHAI has rechristened Cochin Port Road Private Ltd as National Highways Logistics Management Company to oversee multimodal logistics parks and port connectivity projects.
“We don’t have individual SPVs (special purpose vehicles) for each port connectivity project. They now come under the umbrella company National Highways Logistics Management Company,” an executive said.
NHAI proposed to make the firm a holding company for all logistics SPVs for the first time in November 2020. Now with this move, all the previous SPVs have been merged into this subsidiary and also the new ones will be formed by the entity.
The centre believes that having a dedicated entity for cargo movement between ports and roads will lead to revenue and fuel savings and will also provide enhanced connectivity for goods movement and improve first mile connectivity.
“We often say last-mile connectivity (for link between land and port), but it is essentially the first mile because if that part is not covered it will hamper the overall supply chain,” the executive added.
The centre ensures that the roads will be built in such a manner that they won’t impact city traffic despite all-day truck movement. This, in turn, will reduce turnaround time for the transporters and improve their revenue.
To improve port connectivity, the ministry of road transport and highways plans to develop multi-modal logistics parks under its logistics efficiency enhancement programme (LEEP) in 15 locations all over India at a cost of Rs 33,000 crore.
Further, in 2016 the ministry had said it will take up 82 road projects, along with the NHAI, under the Bharatmala scheme, to improve port connectivity.
The projects are part of the broader highway expansion plans for connecting economic hubs to major and minor ports, via road and rail.
Around 1,500 major bridges and 200 rail bridges are part of this, as is connectivity to district headquarters and the Char Dham (Kedarnath, Badrinath, Yamunotri & Gangotri).
Source: Business Standard