Can In­dia leave China be­hind?

The In­dian cargo in­dus­try is see­ing signs of growth with the coun­try’s jump to third rank in the Agility re­port. But the re­port places China on the top. So what can In­dia do to rise faster? Some ex­perts share their views.

Cargo Talk - - Front Page -

Eco­nomic growth means growth in the coun­try’s trans­porta­tion and lo­gis­tics in­dus­try. While In­dia ranked third in the emerg­ing mar­kets lo­gis­tics in­dex for 2016 by Agility which rates coun­tries based on business en­vi­ron­ment, China and the United Arab Emi­rates were first and sec­ond re­spec­tively.

China has good port in­fra­struc­ture fa­cil­i­ties. In­dia, be­ing a penin­sula coun­try, has the po­ten­tial to utilise its lo­ca­tion and reap ben­e­fits of the wa­ter­ways. Also, there is a need for bet­ter in­fra­struc­ture for sea trans­porta­tion for growth of the in­dus­try. So what can In­dia do to go be­yond China? Ac­cord­ing to the Agility re­port nearly 42 per cent op­ti­mists and lo­gis­tics pro­fes­sion­als sense In­dia needs more struc­tural re­form to sus­tain its cur­rent growth and more than 21 per cent be­lieve the coun­try needs more than eco­nomic re­form if it is to un­lock its po­ten­tial. in­vestors, which in re­sult would ac­cel­er­ate the growth rate and help lo­gis­tics com­pa­nies op­ti­mise their op­er­a­tions to re­duce costs and ex­pand their business.”

“The rel­a­tive suc­cess of China lies in its abil­ity to pro­vide bet­ter phys­i­cal in­fra­struc­ture and easy avail­abil­ity of cheap credit. Within in­fra­struc­ture fund­ing, the con­tri­bu­tion of In­dia’s Ra­jen­dra Singh Rao, ASR Lo­gis­tics In­dia. Di­rec­tor, “Lower trans­ac­tion costs have also given Chi­nese ex­ports a much-needed com­pet­i­tive edge. For ex­am­ple, it takes around 40 days to book a con­tainer for ex­ports in In­dia as com­pared to just one day in China,” adds Rao.

“Ma­jor rea­son for China be­ing on first po­si­tion is be­cause they have in­vested heav­ily and in­deed taken ut­most care of lo­gis­tics in­fra­struc­ture be­cause the key to higher ex­port is a smooth in­fra­struc­ture to sup­port,” notes GS Chawla, Man­ag­ing Di­rec­tor, Ocean King Ship­ping.

Ac­cord­ing to Cauchy, In­dia has a vast land­scape and the de­mog­ra­phy here is favourable as com­pared to China. He adds, “How­ever, to match up to the global stan­dards, In­dia needs to adopt newer tech­nolo­gies, in­no­va­tion and bet­ter fun­da­men­tal in­fra­struc­ture in the lo­gis­tics in­dus­try. A bet­ter con­nec­tiv­ity via air, road and sea is re­quired as it poses a hin­drance and min­imises the out­reach cur­rently. The de­ploy­ment of a ro­bust in­fra­struc­ture will pro­vide panoramic ad­van­tage for the fu­ture both in terms of skill devel­op­ment, business fa­cil­i­ties and con­sump­tion.”

Echo­ing sim­i­lar views, Rao points in­fra­struc­ture as an ob­sta­cle to growth. “In­fra­struc­ture in In­dia’s met­ros is in­ad­e­quate for serv­ing ex­ist­ing trade needs. Chal­lenges range from the avail­abil­ity of as­sets to con­ges­tion, reg­u­la­tion and mon­i­tor­ing. In fu­ture, in­dus­trial clus­ters will need Ded­i­cated Freight Cor­ri­dors (DFCs) such as the Delhi-Mum­bai In­dus­trial Cor­ri­dor with high-speed con­nec­tiv­ity to key ports and urban cen­tres,” he says.

When asked about the lo­gis­tics tac­tics and strate­gies that should be used in mak­ing the coun­try’s lo­gis­tics in­dus­try stronger across the world, Cauchy says, “First of all, there is a need for a more ma­ture mind­set of this in­dus­try in the sup­ply chain mar­ket. Se­condly, we also strongly feel that In­dia def­i­nitely needs to ac­cel­er­ate the im­ple­men­ta­tion of the GST bill which in turn will favour the global lo­gis­tics devel­op­ment and pre­pare In­dia to be the lo­gis­tic hub of the world.”

Ac­cord­ing to Chawla, “In­dia has two sides of large coastal line which can strate­gi­cally be utilised for world class ports if east coast ports (Vizag, Chennai, Kolkata) could be de­vel­oped and con­nected with hin­ter­lands via ded­i­cated rail­way freight cor­ri­dors and road in­fra­struc­ture could be im­proved. With this east bound in/out ma­rine traf­fic do not need to call at western ports that are Nhava Sheva, Mun­dra or Pi­pava. Let all con­tainer traf­fic run on in­land rails and con­nect with East­ern In­dia ports. Sim­i­larly with west bound ma­rine traf­fic to be op­er­at­ing from western ports. This way we would be op­ti­misti­cally util­is­ing do­mes­tic freight ser­vices and also de­con­gest the ports.”

Ac­cord­ing to Ajay Khosla, DGM, Jaipur Golden Trans­port, “In­dia has al­ready cre­ated a showground for global busi­nesses to in­vest here with chang­ing gov­ern­ment poli­cies. There is gi­gan­tic in­vest­ment and plans in our present bud­gets to to­tally re­vamp In­dian ground trans­porta­tion to reach ev­ery inch and cor­ner of the coun­try. Although In­dian lo­gis­tics

In­dia has two sides of large coastal line which can strate­gi­cally be utilised for world-class ports if east coast ports could be con­nected with hin­ter­lands There is gi­gan­tic in­vest­ment and plans in our present bud­gets to to­tally re­vamp In­dian ground trans­porta­tion to reach ev­ery inch and cor­ner of the coun­try

sec­tor has come a long way but still lot to at­tain to face global mar­kets. To­day where world over­all econ­omy en­vi­ron­ment is slow­down, In­dian econ­omy is grow­ing with steady speed, al­ready recorded 7.3 per

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