India bats for Improved Logistics Performance Index Ranking

  • April 12, 2024
  • News

India has intensified its efforts to improve its position on the International Logistics Performance Index (LPI) in a bid to bolster its global logistics reputation. The World Bank, which compiles the index, is now set to incorporate more data into its evaluation process to achieve a more precise assessment of trade facilitation worldwide.

Despite making notable progress from its previous rank of 44th, India currently holds the 38th position in the LPI 2023. However, concerns persist regarding the methodology of the index, with the Indian government advocating for a more objective assessment that accurately reflects ground realities.

Sources closely involved in the matter reveal that the World Bank is transitioning towards a data-driven approach, engaging in discussions with nations to reduce reliance on subjective perceptions and increase reliance on concrete data points in the upcoming index.

Dr. Surendra Ahirwar, Joint Secretary (Logistics Division) at the Department for Promotion of Industry and Internal Trade (DPIIT), shed light on India’s logistics landscape and recent developments in a recent interview. Dr Ahirwar emphasized the importance of a rational evaluation of India’s logistics costs, highlighting the release of the Logistics Cost Framework by the Ministry of Commerce and Industry. Developed in collaboration with the National Council for Applied Economic Research, this framework provides comprehensive insights into India’s logistics expenses, estimated to range between 7.8% to 8.9% of the GDP, aligning closely with global benchmarks.

Discussing the government’s vision, Dr. Ahirwar elaborated on initiatives such as the Unified Logistics Interface Platform (ULIP) and the Cargo Tracking App, aimed at streamlining logistics operations and enhancing transparency across the supply chain. He also outlined the need for strategic interventions to optimise expenditure without compromising industry viability.

Further, Dr. Ahirwar emphasized the government’s commitment to fostering a conducive environment for the logistics sector while maintaining sustainability. He stressed the importance of periodic assessments through the Logistics Cost Framework to gauge cost dynamics and inform policy formulation.

Looking ahead, Dr. Ahirwar expressed optimism regarding India’s positioning in the global supply chain, citing synergies between initiatives like the National Logistics Policy, PM Gati Shakti, and the LEADS Report. These concerted efforts, underpinned by competitive federalism, are poised to bolster infrastructure development, enhance logistics efficiency, and elevate India’s stature as a key player in the global value chain.

As India embarks on its journey towards logistics excellence, collaborative endeavours between the government, industry stakeholders and international partners are set to chart a transformative course for the nation’s logistics landscape.