India’s Logistics Sector Progresses towards NLP Goals, Eyes Global Competitiveness

 The sector has already demonstrated tangible results, with India climbing to the 38th position among 139 countries on the World Bank’s Logistics Performance Index in 2023, reflecting enhanced efficiency and infrastructure advancements. The Economic Survey 2023-24 highlighted pivotal reforms and initiatives driving this transformation. Anchored by the NLP and the PM Gati Shakti National Master Plan introduced in 2021, India’s logistics sector has embraced digitalization to streamline operations. Tools such as the Unified Logistics Interface Platform (ULIP) and the Logistics Data Bank have been instrumental in optimizing processes and lowering costs.

The ULIP platform has emerged as a cornerstone of logistical reform, with 614 entities registered as of September 2023. Additionally, 142 companies have submitted 382 use cases, focusing on data exchange, document digitization, and process automation. These advancements have simplified cross-border trade, enhanced last-mile delivery, and introduced reverse logistics solutions. Parallel to digital transformation, physical infrastructure has seen notable upgrades. The Land Ports Authority of India (LPAI) electrified short railway lines linking inland container depots and freight stations, significantly reducing wagon movement times. On the maritime front, the NLP Marine policy and initiatives such as the Coastal Shipping Bill and the Sagar Sethu national maritime portal have streamlined port operations. 

The Goods and Services Tax (GST) has played a crucial role in slashing logistics costs, and implementing the “one nation, one tax” approach. This reform has reduced truck wait times at state borders, cutting travel times by nearly 30% and increasing the average truck distance from 225 km to 300–325 km per day. A National Council of Applied Economic Research study from December 2023 revealed a reduction in logistics costs by 0.8–0.9 percentage points of GDP between FY14 and FY22.

At the state level, logistics performance continues to improve, driven by enhanced warehousing capabilities and better multimodal connectivity. These developments position logistics as a robust pillar of India’s economic framework, with experts forecasting further gains from ongoing government initiatives.

The evolving global trade landscape, spurred by the China Plus One strategy, has elevated India’s prominence in international supply chains. Government-led programs like the One Network for Digital Commerce (ONDC) and ULIP have further equipped the logistics sector to meet shifting consumer and business demands.

The rise of e-commerce and the push for faster deliveries have injected dynamism into the sector. Additionally, the productivity-linked incentive (PLI) program has boosted exports, driving demand for efficient logistics services. Experts predict that combined investments in infrastructure, technology, and workforce development will reduce logistics costs by 4–5%, significantly enhancing India’s competitiveness in global markets.

Government initiatives under the NLP have not only focused on cost reduction but also on improving sector transparency and efficiency. The development of portals such as Sagar Ankalan, to monitor port inefficiencies, and the introduction of metrics to gauge logistics costs have laid the groundwork for data-driven policy interventions…With sustained government support and industry collaboration, India’s logistics landscape is poised for a transformative decade.