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Logistics policy to go to Cabinet for approval, aims to ease goods movement

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Indian industry pays a high logistics cost, hurting the competitiveness of domestic goods in the international market.

The commerce ministry will soon seek the Cabinet’s approval for the national logistics policy, which aims to promote seamless movement of goods across the country.

“The policy is at the near-finalisation stage. Consultations with all ministries, departments and other stakeholders have happened. All their views and comments have been factored in. It will soon go for the Cabinet approval,” Pawan Agarwal, special secretary at the commerce ministry’s logistics division, said on Wednesday.

A comprehensive institutional framework is also being set up to ensure the smooth implementation of the policy, Agarwal added. Towards this end, a national logistics council, a central advisory committee on logistics, and an empowered group of secretaries have been planned.

The council will be headed by Commerce and Industry Minister Piyush Goyal and the empowered group by the Cabinet secretariat.

A national grid of logistics parks and terminals is being planned for the coordinated development of intermodal facilities, promoting intermodal and multimodal logistics parks as a separate class of infrastructure. It is also looking to develop modern warehousing and is formulating guidelines and standards for warehousing, as a part of the policy. The high logistics cost in India has been a pain point for the industry, impacting the competitiveness of domestic goods in the international market. Over the next five years, the government aims to reduce logistics cost from 13 per cent of gross domestic product (GDP) at present to 8 per cent.

The proposed policy has been in the offing for the last few years. Finance Minister Nirmala Sitharaman had announced it in her Budget speech for 2020-21.

Goods and services worth Rs 1 trillion are expected to be procured from the Government e-Marketplace (GeM) portal by this month end.

“This year, the confirmed order value will be around Rs 36,000-37,000 crore. Last year, this figure was Rs 22,896 crore,” GeM Chief Executive Officer Talleen Kumar said. According to official data, the Centre and states procure goods and services worth Rs 5-7 trillion every year.

The government launched GeM over four years ago as an end-to-end e-marketplace to facilitate transparent, efficient, e-procurement of commonly used goods and services required by the Centre, states, and public sector undertakings. It is a government-to-business platform.


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