Tuesday, January 19, 2016

The Indian Logistics 'potential'


In the emerging economies India has overtaken China as the market with the most logistics potential.
As documented in the article India continues to face immense problems like the GST Bill which a recalcitrant opposition continues to block with their unreasonable other political demands. The media doesn't find this news 'sexy' enough to shout hoarse about it and expose the criminal apathy of the political classes

Legislation of such bills is one such issues. Many other crippling issues will ensure that India's 'potential' will remain unchanged, since there will be no actual improvement, for years to come.


  • Bad roads: While some road networks have improved in the past decade the overall state of the road infrastructure can only support an average truck speed of about 20 km/hr and the despicable condition of the ageing truck fleets allow them to be on the road for 20 days in a month (while the international avg is 25)
  • Killer streets: the long hours, high stress and fatigue of the drivers who drive vehicles with an average age of , coupled with the horrible conditions of the Indian roads and perennially clogged traffic lead to in excess of 140,000 fatalities annually
  • Venal officialdom: Survey data shows that bribes paid to Government officials and traffic police, amount to on an average of 15 per cent of total trip expenses. It is not only the expense, the delays caused due to constant stoppages and demands for money with time consuming pretexts of checking papers hurts the entire supply chain and negatively impacts the total costs of all the goods
The condition of the Indian Rail networks, which is a Govt monopoly, is a similar story beset with ineptitude and corrupt management. The utilization rates, travel times, average costs, losses etc all the parameters need a major re haul if this more efficient mode of transport is to be fully utilized to power the growing Indian economy

The current administration does understand the importance of Logistics networks for the Indian economy and has planned massive investments in the rail and road (75 B USD) and shipping sector (75 B USD) by 2019. 

Until then the Indian commuter and consumer will continue to pay a heavy price in terms of money, time and health. 




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