India's logistics cost estimated at 7.8-8.9% of GDP in 2021-22
WAREHOUSING & LOGISTICS

India's logistics cost estimated at 7.8-8.9% of GDP in 2021-22

In the fiscal year 2021-22, India's logistics cost has been determined to be in the range of 7.8-8.9% of the gross domestic product (GDP), which is lower than previous private survey estimates exceeding 10%. The National Council of Applied Economic Research (NCAER) conducted this calculation as assigned by the Department for Promotion of Industry and Internal Trade (DPIIT). The World Bank has reviewed the methodology and recognised its appropriateness as a baseline, with the potential for future fine-tuning, according to government officials.

The logistics cost encompasses various components such as transportation, warehousing, storage, auxiliary support services, packaging, insurance, and other operational costs. DPIIT Secretary Rajesh Kumar Singh introduced the report titled "Logistics Cost in India: Assessment and Long-Term Framework," emphasising its pivotal role in optimising logistics efficiencies and enhancing India's global competitiveness. Singh highlighted the ongoing investments in physical and digital infrastructure, creating an enabling environment for obtaining reliable data for data-driven planning and policymaking.

Poonam Munjal, a professor at NCAER, described the calculation as a quick estimate and expressed the intention to refine the numbers further using more granular data. The government, currently relying on certain estimates, suggests that India's logistics cost is at 13-14% of GDP. The report aims to establish a credible framework for logistics cost estimates, capturing detailed data on an origin-destination (O-D) pair-wise, commodity-wise, and geography-wise basis.

DPIIT Special Secretary Sumita Dawra emphasised the serious implications of logistics cost on the country's manufacturing sector, export competitiveness, and global positioning. The government's effort is to move away from past estimates lacking a conclusive and scientific calculation framework and focus on a more data-driven approach for effective policymaking.

In the fiscal year 2021-22, India's logistics cost has been determined to be in the range of 7.8-8.9% of the gross domestic product (GDP), which is lower than previous private survey estimates exceeding 10%. The National Council of Applied Economic Research (NCAER) conducted this calculation as assigned by the Department for Promotion of Industry and Internal Trade (DPIIT). The World Bank has reviewed the methodology and recognised its appropriateness as a baseline, with the potential for future fine-tuning, according to government officials. The logistics cost encompasses various components such as transportation, warehousing, storage, auxiliary support services, packaging, insurance, and other operational costs. DPIIT Secretary Rajesh Kumar Singh introduced the report titled Logistics Cost in India: Assessment and Long-Term Framework, emphasising its pivotal role in optimising logistics efficiencies and enhancing India's global competitiveness. Singh highlighted the ongoing investments in physical and digital infrastructure, creating an enabling environment for obtaining reliable data for data-driven planning and policymaking. Poonam Munjal, a professor at NCAER, described the calculation as a quick estimate and expressed the intention to refine the numbers further using more granular data. The government, currently relying on certain estimates, suggests that India's logistics cost is at 13-14% of GDP. The report aims to establish a credible framework for logistics cost estimates, capturing detailed data on an origin-destination (O-D) pair-wise, commodity-wise, and geography-wise basis. DPIIT Special Secretary Sumita Dawra emphasised the serious implications of logistics cost on the country's manufacturing sector, export competitiveness, and global positioning. The government's effort is to move away from past estimates lacking a conclusive and scientific calculation framework and focus on a more data-driven approach for effective policymaking.

Next Story
Infrastructure Urban

USA Mortgage Rates Reach 6.95%

In July 2024, the average mortgage rate in the USA rose to 6.95%, marking a significant increase and impacting homebuyers nationwide. This upward trend in mortgage rates is attributed to several economic factors, including inflationary pressures, shifts in the Federal Reserve?s monetary policy, and broader market dynamics. The rise in mortgage rates presents challenges for potential homebuyers, making borrowing more expensive and potentially slowing down the housing market. Higher rates can lead to increased monthly payments for homeowners, reducing affordability and potentially deterring new ..

Next Story
Real Estate

Toronto Home Sales Increase 4.2%

In June 2024, home sales in Toronto experienced a notable rise, increasing by 4.2% compared to the previous month. This growth highlights a positive trend in the Toronto real estate market, indicating robust buyer activity and a favorable environment for sellers. Several factors contribute to this uptick, including attractive mortgage rates, strong demand for housing, and a stable economic backdrop. The Toronto Regional Real Estate Board (TRREB) reported this increase, pointing to heightened buyer confidence and competitive market conditions. Despite rising interest rates in other parts of Nor..

Next Story
Real Estate

New Zealand Boosts Home Construction

New Zealand is set to implement regulatory changes aimed at boosting home construction to address the nation's housing shortage. The government plans to streamline building consent processes, reduce construction costs, and increase the supply of affordable housing. This initiative is part of a broader strategy to make housing more accessible and alleviate the pressure on the housing market. Key elements of the regulatory overhaul include simplifying the approval process for new housing projects and reducing bureaucratic hurdles that often delay construction. By cutting red tape, the government..

Hi There!

Now get regular updates from CW Magazine on WhatsApp!

Click on link below, message us with a simple hi, and SAVE our number

You will have subscribed to our Construction News on Whatsapp! Enjoy

+91 81086 03000

Join us Telegram