India's vision to become a $30 trillion economy by 2047 by focussing on multimodal logistics across road, rail, port and air networks on a single digital platform
Dr. Prashant Prabhakar Deshpande has post-graduated in Economics with a Gold Medal in 1976 and was awarded a Ph.D in Social Sciences from Nagpur University in 2007.
Introduction
The high cost of logistics due to poor infrastructure and efficiency is said to be on the radar of the Indian Policy makers for the past few years.
Taking note of this concern, Budget 2025 underlined that Supply Chain & Logistics are fundamental to all the 4 major engines of growth viz. Agriculture, MSME, Investment & Exports. Higher cost in this sector has been considered the biggest hurdle in India's aspirations to become a hub of global manufacturing. Changes are therefore being planned to further fuel India's growth re-affirming India's position as the fastest growing major economy in the world.
India's vision to become a $30 trillion economy by 2047
With an aim to become a $30 trillion economy by 2047 Indian government has been laying the groundwork for an ambitious transformation of its logistics ecosystem with a focus on reimagining infrastructure development to create a smart, interconnected logistics network that can:
Dramatically reduce transport costs;
Enhance supply chain efficiency, and;
Support sustainable and equitable economic growth.
Nations's current freight logistics scenario
Current Scenario:
Road transport:
India's freight logistics model is heavily skewed towards road transport accounting for nearly 60% of the cargo movement. Although the model is critical for last-mile connectivity, it is considered economically and environmentally inefficient for long-haul freight.
Rail Transport
Rail transport, although inherently safer and more cost-effective for bulk goods, carries just 25% of the total cargo;
Inland Waterways:
Inland waterways although offer vast untapped potential, at present remain grossly underutilised.
The government feels this scenario keeps the logistics costs in the country at a staggering 14–18% of GDP, almost double that of the developed economies, the resulting inefficiency acting as a drag on the manufacturing competitiveness and export agility.
Government's National Master Plan envisioning multimodal logistics
The government in response is reportedly driving a Policy and Infrastructure Overhaul anchored by the PM Gati Shakti National Master Plan envisioning multimodal logistics. It must be noted that it is for the first time that National Infrastructure Planning is being executed in a coordinated, data-backed manner:
Minimising overlap, and;
Enabling targeted investments where they are needed most.
Progress under the National Master Plan
Railways:
Indian Railways, one of the largest players in the transformation, has accelerated capacity expansion along high-density corridors since 2014 fast-tracking strategic projects linking ports, manufacturing clusters, and mining belts. The commissioning of Dedicated Freight Corridors (DFCs) on both the Eastern and Western routes is said to be already delivering results:
Improving freight speed, and;
Freeing up existing tracks for faster passenger train movement.
Simultaneously:
Multi-modal logistics parks are being developed to serve as integrated hubs for road, rail, and port connectivity.
These centres are envisioned as the future-ready logistics engines of the economy:
Cutting down cargo handling time;
Optimising warehousing, and;
Streamlining inventory flow.
Additional features include:
Digital freight tracking;
Automated customs processes, and;
Climate-resilient infrastructure.
Technology too is said to be reshaping logistics with:
Artificial Intelligence with the computational systems to perform tasks typically associated with human intelligence such as, learning, reasoning, problem solving perception & decision making, predicting freight flows;
with the computational systems to perform tasks typically associated with human intelligence such as, learning, reasoning, problem solving perception & decision making, Blockchain , a distributed ledger with growing lists of records that are securely linked together via cryptographic hashes transforming cross-border documentation, and;
, a distributed ledger with growing lists of records that are securely linked together via cryptographic hashes and; GPS-based cargo tracking standardising visibility and accountability across the value chain.
It seems, it has been realised, digitisation no longer is a choice but is the backbone of efficient, sustainable logistics.
Importance of Reform in human capital & governance
However, human capital and governance reform are considered equally vital to maintain momentum ensuring:
A skilled logistics workforce;
Uniform rules across states, and;
Faster digital approvals.
Epilogue
The government's stated goal is to bring logistics costs down to 12% of GDP by 2030 and aligning it with the global standards of 8% or less by 2040.
It is opined, achieving this, will not only reduce operational costs for businesses, but also:
Support exports;
Improve the ease of doing business, and;
Enable inclusive employment generation in Tier-II and Tier-III cities.
Building upon transformational initiatives like the PM Gati Shakti, the National Logistics Policy (NLP), Logistics Efficiency Enhancement Programme (LEEP), development of Dedicated Freight Corridors (DFCs), Bharatmala Pariyojana, Sagarmala programme, formulation of the National Rail Plan (NRP), Multi-Modal Logistics Parks, National Infrastructure Pipeline and Jal Marg Vikas Project, the Government has been introducing cohesive policies that are aimed at reducing logistics costs.
It is opined this strategic focus demonstrates government's stronger commitment to tackling long-standing challenges such as:
Fragmented networks;
Underdeveloped infrastructure, and;
Underuse of technology.
Aligning logistics reforms with economic planning is said to make Budget 2025 a crucial turning point in India's effort to boost global competitiveness and drive sustainable growth.
As India charts its path towards its Centennial economic vision, logistics infrastructure will be the foundation. It is however opined, to truly realise this vision, the infrastructure:
Must be smart;
Sustainable, and;
Synchronised.
It is opined the Policy & government's resolve in its implementation are steering India in the right direction.
Facebook Twitter Linkedin Email Disclaimer
Views expressed above are the author's own.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Hindustan Times
18 minutes ago
- Hindustan Times
India-US trade talks need political push for final leg
The fine print of a preliminary trade deal between India and the US has mostly been worked out by negotiators from both sides but the ball is now in the court of the political leadership to break a stalemate, people aware of the parleys told HT, disclosing two of the topmost sticking points that remain. Trade experts said an interim trade deal between India and the US is possible by July 9, provided both respect practical and political sensitivities of each other. (AFP File) According to these people, these issues are: an unequivocal assurance that New Delhi seeks from Washington that all punitive levies will be repealed, and a freer access to India's politically sensitive agriculture sector that the American side has sought. 'The two-day deliberation that started in Washington on Thursday will likely stretch over to next week,' one of these people, who has direct knowledge of the talks, told HT. Both sides are in a sprint to announce a breakthrough, which will be a preliminary deal covering some portion of the trade between two nations, with a larger bilateral trade deal expected to be signed by October. Once the deal is done, India wants America to withdraw all existing and potential retaliatory tariffs, including the 26% reciprocal tariff — this comprises a 10% baseline tariff imposed from April 5 and an additional 16% country-specific levy set to trigger from July 9. India also wants the US to revoke all safeguard duties disputed at the World Trade Organisation—50% on Indian steel and aluminium and 25% on automobiles and auto parts—and to reciprocate New Delhi's move by proportionately slashing its most favoured nation tariffs. 'Washington has not yet given any unequivocal commitment on these matters, which are crucial for Indian interests,' another person said. American negotiators have been suggesting India replicate the US-UK Economic Prosperity Deal model, where Britain accepted continued 10% baseline tariffs on most goods while securing relief from additional sectoral tariffs. However, Indian negotiators have rejected this approach. The other sticking point is the US insistence on India opening its agriculture and farming sector. While the American side is open to tariff rate quotas (TRQ) — a mechanism under which concessional duty or duty-free access of any specified item applies to a limited quantity — their insistence on some sensitive sectors is a challenge. 'The problem lies in wanting India to also open its sensitive sectors. Dairy imports are restricted for two reasons. First, India's dairy farming is at a subsistence level with one or two cows or buffaloes. The livelihoods of millions of farmers are at stake as they could not compete with America's commercial-scale dairy farms. Secondly, the US cattle feed includes non-vegetarian products, something against religious sentiments of Indian consumers,' a third person said. Similarly, India is unable to accept the US demand to allow unrestricted access to American agricultural items such as corn and soybean because Indian law does not permit genetically modified crops. 'America is unwilling to accept an institutional mechanism which would certify that its India-bound agriculture produce are not genetically modified, saying there is a practical problem in segregating GM and non-GM products,' this person said. This person added that solving such issues now require a political directive from the highest levels of the government. 'While majority of issues have been resolved with near consensus, including on removing tariff and non-tariff barriers on most of the items of interest for both countries, certain sensitive matters require political directives from the two leaders. An interim India-US trade deal, mainly involving goods, is possible to conclude before July 9, depending on political resolution of the stalemate,' the second person said. The Indian negotiating team could extend its stay in Washington next week and the two parties would discuss contentious issues, depending on any political directive, according to the first person. The Indian negotiating team led by chief negotiator and special secretary-commerce Rajesh Agrawal was still in Washington on Saturday, indicating that talks may extend into next week. Trade experts said an interim trade deal between India and the US is possible by July 9, provided both respect practical and political sensitivities of each other. Global Trade Research Initiative founder Ajay Srivastava outlined a likely scenario: 'The more likely outcome is a limited trade pact—styled after the US-UK mini trade deal announced on May 8. Under such a deal, India is expected to cut MFN tariffs on a wide range of industrial goods, including automobiles, a persistent demand from Washington. In agriculture, India may offer limited market access through tariff reductions and TRQs on select US products such as ethanol, almonds, walnuts, apples, raisins, avocados, olive oil, spirits, and wine.' 'However, India is unlikely to budge on sensitive sectors. No tariff cuts are expected for dairy products or key food grains like rice and wheat, where farm livelihoods are at stake. These categories are politically and economically sensitive, affecting over 700 million people in India's rural economy,' he added. Srivastava warned that 'the talks may collapse' if the US continues to insist on opening India's core agriculture sectors or allowing entry of GM products. The prudent move for Washington would be to respect Indian sensitivities and forge a deal for stronger strategic cooperation in future, he said, noting that 'agricultural goods account for less than 5% of US exports to India.' Another expert working in a multinational consulting firm said: 'Now it is the time for America to act as India has already given several concessions, making its intent clear for stronger and everlasting economic cooperation with the US.' After a week where tariffs took a back seat to the US strike on Iran's nuclear facilities and the massive tax and spending bill in the US Congress, the Trump administration's trade negotiations have picked up. News agency Reuters reported Washington had sent a new proposal to the EU on Thursday and held talks with Japan on Friday. Both India and Japan are in advanced negotiations.
Time of India
19 minutes ago
- Time of India
My government committed to freeing India from colonial mindset: PM Modi
NEW DELHI: PM Modi asserted that his government is committed to freeing the nation from the colonial mindset and advancing it with equal emphasis on development and heritage, while safeguarding the enduring vitality of Indian languages. He was addressing the centenary celebrations of Jain saint Acharya Vidyanand Maharaj at Vigyan Bhawan on Saturday. "We are promoting mother tongues in higher education. And that is why I said from the Red Fort that we must free the country from the mentality of colonialism. We must move forward with development and heritage together," he said countering opposition from some states to the Centre's three-language formula and accusation of Hindi imposition. Modi highlighted the govt's recent recognition of Prakrit as a classical language in Oct 2024, alongside efforts to digitise ancient Jain scriptures and promote mother tongues in higher education. On the occasion, the PM was conferred with the title of 'Dharma Chakravarti', to which he said, "I do not consider myself worthy of it, but our tradition teaches us to accept what is given by saints as prasad. Therefore, I humbly accept this prasad of yours and dedicate it at the feet of Mother India." he also referred to the preceding speech of a Jain seer, noting that he was blessing " Operation Sindoor ". PM's mere mention of "Jo humein chhedega (those who trouble us)" brought massive cheers from the audience, but he did not dwell any further on the issue. Before Modi's address, Acharya Pragya Sagar Maharaj endorsed "Operation Sindoor", saying the PM demonstrated unprecedented leadership, conveying the message that India doesn't believe in conflicts but is capable of giving a befitting reply in case someone throws a challenge. Modi said Acharya Vidyasagar Maharaj used to say, "life can become imbued with dharma only when life itself becomes service." "This thought is connected to the essence of Jain philosophy and India's consciousness. India prioritises service (and) humanity. When, for thousands of years, the world was trying to quell violence with violence, India taught the power of non-violence. We placed the spirit of serving humanity above all. "
Indian Express
27 minutes ago
- Indian Express
Behind Mazagon Dock's Lanka deal: Eye on China, Colombo bailout plea
A strategic move to contain China's expanding footprint in the region, a Sri Lankan SOS for bailout, and a failing Japanese firm — these were among the factors that led to the Indian government-run Mazagon Dock Shipbuilders Limited's decision to acquire a controlling stake in Sri Lanka's Colombo Dockyard PLC under a US$ 52.96 million deal, officials have told The Indian Express. Announcing its decision on Friday, Mazagon Dock Shipbuilders Limited (MDL) had said: 'Located in the Port of Colombo, Colombo Dockyard PLC (CDPLC) gives MDL a strategic foothold in the Indian Ocean Region — a key maritime corridor.' CDPLC, listed on the Colombo Stock Exchange, is the flagship of Sri Lanka's maritime industry and serves a wide spectrum of commercial and governmental clients across Asia, Middle East and Africa. Officials from both the Sri Lankan and Indian governments worked overtime to conclude this strategic deal on Sri Lanka's largest shipyard, said sources. According to officials, CDPLC has been in dire straits for some time. 'Since it is 51% owned by Onomichi Dockyard Company Ltd, they initially sought relief from the Government of Japan, and thereafter from the Government of Sri Lanka. However, neither government could provide any financial relief to them,' an official said. At the end of November 2024, Onomichi Dockyard exited from CDPLC. At this point, officials said, the Sri Lankan government requested the Indian government to encourage Indian investors to look at Colombo Dockyard. 'A default by CDPLC would be serious for the Sri Lankan government as, out of the remaining 49% stake, around 16% is owned by their Employees' Provident Fund. Sri Lanka's insurance fund owns around 9%, Sri Lanka Ports Authority 5% and so on. A default would also have brought great financial distress and uncertainty for the workers employed in Colombo Dockyard,' the official said. 'A few companies, with strong credentials, expressed an interest in CDPLC. As per the due process followed for a listed company, MDL was shortlisted in view of its prowess in shipbuilding as well as its financial strength. Both these aspects are key for the turnover of Colombo Dockyard,' the official said. MDL's net worth, represented by its market capitalisation, is approximately $15.12 billion as of June 25, 2025. The company is almost debt-free. It has reported a turnover of approximately $1.13 billion, according to officials. MDL's decision is expected to significantly change the shipbuilding and ship repair landscape in the region. With CDPLC its first international venture, it is seen as a major milestone in the company's transformation from a purely domestic shipbuilder into a regional maritime player with global aspirations. 'It demonstrates the appetite by Indian industry, including PSUs, to acquire strategic assets overseas and to build investment-led partnerships,' the official said. On the other hand, MDL's controlling stake will serve as a force multiplier for CDPLC, said officials. MDL will bring an order pipeline for CDPLC from both domestic and international market for repairs, refits and new builds, they said. The move is expected to boost the existing revenue stream from the Indian sub-continent's ship repairs. A number of orders for which potential clients are approaching MDL can be diverted to CDPLC, the official said. On sharing of expertise, the official said both the shipyards possess enormous expertise garnered over the past decades. 'This strength can be leveraged for mutual benefit and can result in a win-win scenario,' the official said. The resources available at both the yards can be shared for mutual benefit. 'For instance, the detailed design capabilities possessed by both the yards can be leveraged for projects at MDL as well as at CDPLC,' the official said. CDPLC, which is currently under financial distress, can benefit from MDL's strong financial capabilities, thereby expediting the turnaround process. CDPLC will now be in a position to secure contracts which it missed earlier due to poor financial health, the official said. In a regulatory filing, the Mumbai-headquartered shipbuilder said the proposed acquisition would enable the company to strengthen its position in the ship repair and shipbuilding industry by unlocking operational synergies, enhancing research development capacities and expanding market reach. 'It supports the company's long-term growth vision in the shipbuilding and ship repair industry,' it said. The move comes amid concerns in New Delhi over Beijing's persistent attempts to expand its strategic influence in the island nation. China Merchants Port Holdings holds an 85% stake in Hambantota International Port Group (HIPG) and secured a 99-year lease on the Hambantota International Port (HIP) in Sri Lanka in 2017. In July 2024, CDPLC and HIPG signed an agreement to set up a full-fledged workshop at HIP. Shubhajit Roy, Diplomatic Editor at The Indian Express, has been a journalist for more than 25 years now. Roy joined The Indian Express in October 2003 and has been reporting on foreign affairs for more than 17 years now. Based in Delhi, he has also led the National government and political bureau at The Indian Express in Delhi — a team of reporters who cover the national government and politics for the newspaper. He has got the Ramnath Goenka Journalism award for Excellence in Journalism '2016. He got this award for his coverage of the Holey Bakery attack in Dhaka and its aftermath. He also got the IIMCAA Award for the Journalist of the Year, 2022, (Jury's special mention) for his coverage of the fall of Kabul in August 2021 — he was one of the few Indian journalists in Kabul and the only mainstream newspaper to have covered the Taliban's capture of power in mid-August, 2021. ... Read More
