What Is The National Logistics Policy (NLP)?
Introduced in September 2022, the National Logistics Policy’s goal is to drive economic growth and enhance the country’s business competitiveness by developing an integrated, efficient, green, and sustainable logistics network with the help of top-tier technology, optimised processes, and skilled manpower.
The government hopes to increase the competitiveness of Indian products in both the Indian and the international markets. Further, the government aims to boost efficiency efforts across all sectors of the economy, which encourages value addition and enterprise.
What Are The Goals Of The NLP?
The National Logistics Policy (NLP) has the following goals:
- Reduce the logistics cost from 16% of GDP to a global average of 8% by 2030.
- Improve efficiency across all sectors of the economy.
- Create a modern infrastructure system with a world-class standard.
- Make the logistics industry more efficient.
- Boost economic growth.
- Provide employment opportunities.
- Make Indian products more competitive in the global market.
What Are The Key Components Of The NLP?
The National Logistics Policy outlines the following components
- Integration Of Digital System (IDS): The policy aims to digitally integrate different systems of road transport, railways, aviation, commerce ministries and foreign trade to create a consolidated, centralised system.
- Unified Logistics Interface Platform (ULIP): The NLP aims to create the ULIP, a UPI-like framework for logistics companies. The ULIP seeks to ensure shorter and smoother cargo movement and enables the exchange of information confidentially on a real-time basis. The government also aims to leverage the National Industrial Corridor Development Corporation (NICDC) Logistics Data Bank Project to develop the ULIP.
- Ease Of Logistics (ELOG): The policy also stipulates ease of logistics business through transparency and accessibility.
- System Improvement Group: Finally, the new logistics policy aims to monitor all logistics-related government projects regularly and make improvements to help the government achieve its stated goals in the NLP.
How Will The National Logistics Policy Benefit The Indian Economy?
The National Logistics Policy is expected to benefit the Indian economy in several ways, including:
- Reducing Logistics Costs: The current logistics costs in India are 13-14% of GDP, which is high compared to other developed countries. The NLP aims to bring this cost down to 8% by 2030, improving the competitiveness of Indian products both domestically and internationally.
- Increasing Efficiency: The NLP includes several initiatives to improve efficiency in the logistics sector such as digital integration of different systems and better coordination between stakeholders. This is expected to save time and money for businesses and boost overall economic growth.
- Creating Jobs: The logistics sector is already a large employer in India, and the NLP is expected to create even more jobs. As the sector grows, new industries and businesses will be supported by the improved logistics infrastructure, creating more job opportunities within logistics.
- Boosting Exports: By reducing logistics costs and improving efficiency, the NLP is expected to make it easier and cheaper to export goods from India. This could lead to a significant increase in Indian exports, which would benefit the overall economy.
- Making India A Global Manufacturing Hub: The NLP is part of a broader government effort to improve India’s infrastructure and connectivity. This will make it easier and more efficient to move goods, which is essential for manufacturing. As a result, the NLP is expected to help India become a more competitive global manufacturing hub.
