PM Gati Shakti National Master Plan could accelerate an inclusive, digitalised and decarbonised economic transformation of India. As multimodal connectivity ought to improve resilience of domestic supply chains, giving infrastructure projects a green, inclusive and digital focus at the planning and implementation phases will boost national efforts for such a transition.
- With 18 ministries in collaboration, the Gati Shakti National Master Plan for Multimodal Connectivity comes on the back of a massive push towards building ports, inland waterways, railways, roadways, gas pipelines, metros and network of fibre optics cables etc., across the nation.
- Silos-based infrastructure planning and implementation has by far been a major obstacle undermining India’s economic potential. Negligible integration of logistics nodes has continued to create an unfavourable logistics environment for small businesses, famers, entrepreneurs and women, in particular.
- India has made remarkable strides in digital trade facilitation measures, evident from single window and digital trade compliance provisions to encouraging logistics players to provide trackability and traceability features. Going further, blockchain technology could help streamline intermodal logistics operations with use of mechanisms like smart contract.
- There is a substantial progress on integrating different passenger logistics nodes in many cities in India but largely across the passenger segment. There is a need to give attention to providing adequate interconnections between freight and passenger logistics nodes, as well.
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PM Gati Shakti National Master Plan (NMP) for Multimodal Connectivity is a tremendous step taken to break silos to integrated planning and execution of connectivity infrastructure projects in India. At its launch on October 13, 2021, Prime Minister Narendra Modi stressed upon the need of reducing logistics cost and turnaround time, and increasing cargo handling capacity as one of its objectives to boost economic growth and competitiveness.
With 18 ministries peddling this initiative together, the NMP promises the speed (Gati) and the power (Shakti) to accelerate India’s multimodal logistics transformation. This comes on the back of a massive priority accorded to building ports, inland waterways, railways, roadways, gas pipelines, metros and network of fibre optics cables etc., across the nation.
The NMP is also followed by the launch of a National Infrastructure Pipeline (NIP) in August 2020 that is a live repository of around 9,000 and growing number of infrastructure projects. NIP estimates worth US$ 1.4 trillion in investments needed during FY 2020-25 across transport, logistics, energy, water & sanitation, communication, social and commercial infrastructure and their sub-sectors. The NMP is an accelerator of NIP, in general, and multimodal logistics projects, in particular, to steer India towards a US$ 5 trillion economy by 2025.
Silos-based infrastructure planning and implementation has by far been a major obstacle undermining India’s economic potential. Negligible integration of logistics nodes has continued to create an unfavourable logistics environment for small businesses, famers, entrepreneurs and women, in particular. Excessive dominance of road freight has led to expansion of roads & highways and diesel engine vehicles contributing to heavy rise in congestion and pollution. Not only has that, among others, affected assets utilisation (ports, trucks etc.), but also contributed to the continued worsening of living conditions (e.g. road safety, air pollution, and traffic).
Moreover, benefits such as last mile connectivity and reasons such as lack of intermodal integration continue to compel the trading community to still prefer roads. A number of intermodal logistics junctures such as inland waterways terminals and dedicated freight corridors are emerging in India. However, they are either unpopular or commercially unviable despite being cost, service and environment competitive.
Inclusive, digital and green supply chains
In view of this year’s Glasgow climate talks, UNGA and G20 mandates, PM Gati Shakti NMP could accelerate an inclusive, digitalised and decarbonised economic transformation of India. As multimodal connectivity ought to improve resilience of domestic supply chains, giving infrastructure projects a green, inclusive and digital focus at the planning and implementation phases will boost national efforts for such a transition.
An integrated approach could ensure that a domestic or cross border logistics hub is well-integrated with intermodal nodes while being serviced with renewable energy and high bandwidth digital networks etc. A recent report by United Nations encourages countries to make climate-smart trade and investment a priority for sustainable development. The report underlines ‘’the linkages between trade, investment and climate change and discusses the degrees to which regional trade and investment policies address climate change using a newly constructed index.’’
A special emphasis should be accorded to women’s economic empowerment. For that, making gender main-streaming integral to the development of logistics infrastructure and mobility networks while ensuring enabling technology, finance, training, skills and operations will be essential. That needs to be ensured at policy, planning and execution levels. This could be impactful provided inputs for micro infrastructure planning are sought from women groups and other marginalised economic actors.
For such community consultations, support from local chapters of business chambers, civil society and non-government organisations could be prioritised. Such consultations can provide grassroots perspectives for ensuring a green, inclusive and digital multimodal logistics focus, while bolstering commercial viability and addressing political sensitivities. An equally important step is to optimise utilisation of established and emerging inter-modal logistics nodes in India by providing targeted policy and financial incentives for private sector to prefer intermodal routes.
Furthermore, the NMP could ensure that exporters and importers get convenient labelling, packaging, and testing & certification facilities in and outside of ports for cross-border trade. There should be efforts to identify commercially viable opportunities including for independent private testing & certification investment opportunities that can provide regulatory approvals with ease, speed and transparency with use of technology.
India has made remarkable strides in taking digital trade facilitation measures. It is evident from single window and digital trade compliance provisions to encouraging logistics players to provide trackability and traceability features on the back of a robust public digital ecosystem. GST, VAHAN and ICEGATE are just a few examples towards enabling trade digitalisation.
Going further, blockchain technology could help streamline intermodal logistics operations with use of smart contract, for example, within the country. India could expedite joining the Framework Agreement on Facilitation of Cross-border Paperless Trade in Asia and the Pacific to implement digital trade facilitation measures i.e. electronic exchange of trade-related data across borders. Bangladesh, among others, has acceded to the treaty in the country’s immediate neighbourhood. .
There is a substantial progress on integrating different passenger logistics nodes in many cities in India but largely across the passenger segment. There is a need to give attention to providing adequate interconnections between freight and passenger logistics nodes, as well. Many overland ports, for example, do not even have safe and reliable mobility services.
This is while cost of commuting by private taxi or personal vehicle to a dry port or seaport, that is usually in the outskirts of a city, remains very high. That also contributes to already exacerbated congestion and pollution problems. Interconnections e.g. by metro/bus rapid transit system could thus facilitate businesspersons’ visits to ports e.g. for a trade compliance purpose in a safe, cost effective and less carbon footprint manner.
Attracting logistics infrastructure investments in that context can be a force multiplier for a green, inclusive and resilient multimodal connectivity. Involving people and private sector will build collective (public, private and people) strengths in the interest of a common cause, while breaking infrastructure silos in reality. Furthermore, the proposed digital platform under the NMP could be linked with NIP and ensure that enlisted projects are benchmarked as commercially and financially viable as well as remain inclusive, digital and green in accordance with globally aligned principles.
As the Prime Minister has indicated, the NMP should aim to get Indians rid of wasteful practices of digging a road again and again for other utilities, and instead ensure well-integrated quality infrastructure with zero cost- and time- overruns. A huge problem this is likely to face is from vested interests.
A vegetable farmer who travels 70 kilometres every day to sell his visibly meagre produce in Jaipur’s largest Muhana Mandi told me once that his village is well connected by roads. But still construction and maintenance of roads are preferred instead of reviving the Ramgarh Lake – close to where he lives and has enough land. He says there are lobbies that are interested in building roads because that means commission.
Reviving a lake or river also means greater availability of water for irrigation purposes that can potentially encourage a small famer to grow better crops or set up a food processing unit to expand into domestic and even global markets through improving logistics. Such interests, therefore, also need to be navigated to keep people’s prosperity at the heart of PM Gati Shakti NMP for multimodal connectivity.
Prashant Sharma is a Jaipur-based global economic and strategic affairs analyst. Views expressed are personal.
