Integration of Various Transport Modes and Its Role in Enhancing India’s Trade Competitiveness

The integration of various transport modes, such as railways, roads, airways, and waterways, is crucial for improving logistics efficiency and enhancing India’s trade competitiveness. By creating a seamless and coordinated transport network, India can reduce logistics costs, improve supply chain efficiency, and make its exports more competitive in the global market. Recent government initiatives have focused on promoting multi-modal transportation, fostering connectivity, and modernizing infrastructure.

1. Reduction in Logistics Costs:

One of the primary benefits of integrating transport modes is the reduction in logistics costs, which currently stands at around 13-14% of GDP in India—higher than developed countries. The National Logistics Policy (NLP), launched in 2022, aims to reduce this to 8%. Multi-modal transport allows for efficient movement of goods by leveraging the strengths of different transport modes (rail for bulk, road for last-mile connectivity, and air for speed). The Gati Shakti National Master Plan is a key initiative to enhance logistics infrastructure and reduce transportation costs through the development of multi-modal corridors.

• Example: The Eastern and Western Dedicated Freight Corridors (DFC), aimed at streamlining rail freight movement, are expected to reduce the time and cost of transporting goods across the country by reducing road dependency.

2. Improved Supply Chain Efficiency:

Integrated transport networks facilitate faster and more reliable movement of goods, improving overall supply chain efficiency. The Bharatmala Pariyojana focuses on building economic corridors and multi-modal transport infrastructure to enhance connectivity between production hubs and ports, thereby making supply chains more predictable and efficient.

• Example: The development of the Mumbai Trans Harbour Link and the Delhi-Mumbai Expressway integrates road and sea routes, reducing travel time for cargo to reach ports and boosting export potential.

3. Enhanced Port Connectivity:

Ports are vital gateways for international trade, and integrating them with road, rail, and inland water transport enhances their efficiency. The Sagarmala Project focuses on improving port connectivity through the development of coastal shipping, inland waterways, and dedicated rail lines, reducing cargo transit time and costs.

• Example: The Chennai-Kolkata Dedicated Freight Corridor will significantly enhance the movement of goods between major industrial hubs and ports, making exports more competitive.

4. Facilitating Cross-Border Trade:

Efficient multi-modal transport is critical for boosting cross-border trade and regional cooperation. The development of border infrastructure and multi-modal logistics parks in key trading areas is facilitating smoother trade with neighboring countries like Bangladesh, Nepal, and Bhutan, which rely heavily on India’s transportation network.

• Example: The India-Myanmar-Thailand Trilateral Highway project aims to integrate road and port infrastructure to promote trade across Southeast Asia.

5. Technological Integration for Seamless Coordination:

The integration of digital technologies is crucial for optimizing multi-modal transport networks. The Unified Logistics Interface Platform (ULIP), under the NLP, is designed to bring together different modes of transport on a single platform, enabling real-time tracking, better coordination, and more efficient cargo movement.

• Example: The Logistics Data Bank (LDB) project, implemented at major Indian ports, uses RFID technology to track container movements, improving transparency and reducing delays in the supply chain.

6. Promotion of Sustainable Transportation:

Integration of green and sustainable transport modes, such as inland waterways and electric vehicles, is helping reduce the environmental impact of trade logistics. The Jal Marg Vikas Project (JMVP) aims to enhance the use of India’s extensive river network for cargo transportation, offering an eco-friendly alternative to road and rail transport.

• Example: National Waterway 1 (NW-1) on the Ganga River has been developed as part of JMVP, facilitating the movement of cargo from Haldia to Varanasi, reducing road congestion and fuel consumption.

Conclusion:

The integration of various transport modes in India is a game-changer for enhancing trade competitiveness. By reducing logistics costs, improving supply chain efficiency, and enhancing port connectivity, multi-modal transport systems are making India’s exports more competitive on the global stage. Key initiatives like Sagarmala, Gati Shakti, and Dedicated Freight Corridors demonstrate the government’s commitment to building an efficient and sustainable logistics ecosystem. However, continued investments in infrastructure and technology are required to fully unlock the potential of these systems.