Water and Energy International
SCOPUS
  • Year: 2023
  • Volume: 66r
  • Issue: 2

National logistics policy and its impact on the power sector logistics

  • Author:
  • Mohammad Siddiqur Rahman1, Anil Kumar2, Rohit Gupta3
  • Total Page Count: 6
  • Page Number: 48 to 53

1The Tata Power Company Limited, Jojobera Power Plant, Jamshedpur, Jharkhand

2Department of General Management, School of Business, University of Petroleum and Energy Studies, Dehradun

3The Tata Power Company Limited, Jojobera Power Plant, Jamshedpur, Jharkhand

Online published on 14 June, 2023.

Abstract

India's logistic sector is highly fragmented and unorganised resulting into high logistics cost. India's logistics cost is around 14% of its GDP which is way higher than the global average of 8%. According to World Bank Logistics Performance Index (LPI-2018), India is ranked 44th out of 160 countries in the logistics cost with a score of 3.09 out of 5. This score indicates that India's logistics sector has room for improvement, but it also highlights the potential for growth and improvement in the country's logistics infrastructure and services. Currently India's logistic market is $160 billion which is expected to be $215 billion in next two years. The Ministry of Commerce and Industry stated that more than 22 million people in India depend on the logistics industry for their livelihood. Improving the sector will enable a 10% reduction in indirect logistics costs, which will result in an increase of 5 to 8% in exports and a considerable reduction in Power Generation Cost. To address the concerns and improve the efficiency of logistics sector, PM GatiShakti also known as National Master Plan for multimodal connectivity (PMGS-NMP) was launched on 13th October 2021 to implement infrastructure connectivity among various economic zones and synergise between various government agencies. On 17th September 2022, National Logistics Policy was launched, the objective of which is to improve India's trade competitiveness, create more jobs, improve India's performance in global rankings and pave the way for India to become a logistics hub. The Policy shall be very useful for the National Infrastructural Development and Growth in General and for the transportation of coal in the country as India is one of the largest producer of coal with an estimated production of 729.10 million tonnes in 2021 as majority of the coal consumption is used in power sector. With improved supply chain efficiency it shall help in lowering the coal transportation cost, thereby improving the efficiency and reliability of fuel supply to power plant.