“Contracts for implementation of Multimodal Logistics Parks at four locations through PPP mode will be awarded in 2022-23”, announced Union Budget 2022. This is going to provide a much needed solution towards reducing logistics costs in India. It is well documented that as a proportion of the total value of goods, logistics costs are almost double in India (around 14%) as compared to developed nations( around 7%), hence there is a lot of room for improvement. This underlines the need and power of Modern logistics mechanisms, which is a lot systematic and integrated. It offers a full range of one-stop service through using IT and industry expertise extensively to support the entire supply chain, from transport, to warehousing management, to order processing, to delivery and customer service.
Multi-Modal Logistics Parks or MMLPs, a key policy initiative of the Government of India, is being led by NHAI and the National Highways Logistics Management Ltd under Ministry of Road Transport and Highways (MoRTH). It may be defined as a freight-handling facility with a minimum area of 100 acres, with various modes of transport access, mechanized warehouses, specialized storage solutions (such as cold storage), facilities for mechanized material handling, bulk and break-bulk cargo terminal, etc. In 2017, the Government of India launched a program to develop 35 MMLPs across the country. This was followed by India securing rank 44 in the World Bank’s Logistics Performance Index (LPI) 2018, wherein it competed with 160 other countries.
India has been able to climb up in the Logistics Performance Index riding on massive capacity investments made since last 4-5 years, in transport, in major policy reforms like GST and measures supporting Ease of Doing Business. Mega projects like the ambitious Bharatmala, Sagarmala, UDAN, Dedicated Freight Corridors, and other relief measures in transportation mechanisms have largely contributed in churning the Logistics and supply chain cycles.
In India, each segment of logistics encounters tricky challenges which lead to low efficiency and high cost. In order to bring this cost down MMLPs can facilitate freight aggregation and distribution, integrated storage and warehousing, seamless multimodal freight transfer, tech support, and value-added freight services. MMLPs aim to improve India’s freight logistics sector by lowering overall freight costs and time, reducing warehousing costs, cutting vehicular pollution and congestion, improving the tracking of consignments and more.
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