The Indian Ministry of Commerce and Industry recently released the LEADS report for 2022, marking a significant step toward assessing logistics infrastructure, services, and human resources across all 36 states and Union Territories. The LEADS survey is an indigenously developed data-driven index that plays a crucial role in identifying areas for intervention to enhance logistics efficiency. Plus, its findings also influence other global indices, such as the Logistics Performance Index. The inaugural LEADS report was published back in 2018.
Examining the Key Conclusions from LEADS 2022
Unlike earlier versions that relied on ranking systems, the 2022 iteration used a classification-based grading system. It categorized states into four segments: coastal states, hinterland or landlocked states, north-eastern states, and Union Territories. A comparative performance assessment was conducted to determine how each state or Union Territory fares against the leading entity within their respective cluster.
In terms of performance, three categories were identified: Achievers (states or UTs scoring 90% or higher), Fast Movers (with scores ranging between 80-90%), and Aspirers (with scores below 80%). The Achievers category included Andhra Pradesh, Assam, Chandigarh, Delhi, Haryana, Himachal Pradesh, Karnataka, Maharashtra, Odisha, Punjab, Tamil Nadu, Telangana, Uttar Pradesh, Uttarakhand, and Gujarat. Accordingly, Maharashtra emerged as the top performer among Achievers.
The Implications of the LEADS Report for National Logistics Policy and PM Gati-Shakti National Master Plan
The findings in the LEADS 2022 report will aid in the formulation of the PM Gati-Shakti National Master Plan (PMGS-NMP) and the National Logistics Policy (NLP). These plans aim to map logistics infrastructure, services, and regulatory environments in order to help state governments identify potential gaps and establish data-driven multimodal connectivity.
With its potential to improve logistics efficiency, PMGS-NMP could result in annual savings exceeding Rs. 10 Lakh Crore, reducing logistical costs to single digits within the next few years. It is also expected to facilitate integrated infrastructure planning in remote areas, paving the way for development. As part of the PMGS-NMP, 197 critical infrastructure gap projects have been identified.
Understanding the Logistics Performance Index
The World Bank Group devised the Logistics Performance Index (LPI) as an interactive tool to assist countries in identifying their challenges and opportunities concerning trade logistics. The index measures six key aspects: efficiency of clearance process by border control agencies, quality of trade and transport-related infrastructure, ease of arranging competitively priced shipments, competence and quality of logistics services, ability to track and trace consignments, and timeliness of shipments. In 2018, India secured the 44th spot on the LPI.
Key Initiatives Relating to Logistics
Several initiatives are contributing to the enhancement of logistics services across India. They include the Multimodal Transportation of Goods Act (1993), the PM Gati Shakti Scheme, the establishment of Multi Modal Logistics Parks, release of LEADS Reports, the Dedicated Freight Corridor, Sagarmala Projects, and the Bharatmala Project. All of these measures aim to streamline and optimize logistics services, thereby improving connectivity and contributing to the country’s overall economic growth.
For reference, a previous year’s question from the UPSC Civil Services Examination was: “Discuss the need for meticulous coordination between the government and private sector to achieve the goal of connectivity under the Gati-Shakti Yojana.”
