India, Japan to set up Logistics Data Bank to expedite bilateral trade

LDB will ensure speedy movement of two-way merchandise trade by way of real-time tracking of container and cargo movement in DMIC region

In a first of its kind with any country , India and Japan are going to soon set up a logistics data bank (LDB) service that will ensure speedy movement of two-way merchandise trade by way of real-time tracking of container and cargo movement in the Delhi-Mumbai Industrial Corridor (DMIC) region.

The LDB will be operated by a special purpose vehicle (SPV), which will be jointly run by DMIC Trust from Indian side and Japan's NEC.Once in operation, the LDB is expected to save $3.2 billion annually by 2017 on the basis of real time tracking of container movement. The shareholders agreement (SHA) for the project is under discussion presently. The concept was basically developed to address the issue of tracking and viewing container movement across all ports to the ICDs and end-users.

“This is a smart community project in partnership with the Japanese government for introducing a paradigm shift in logistics and container movement in the DMIC by generating and analysing near real time data across all regulatory interface for diverse stakeholders,” Talleen Kumar, joint secretary, department of industrial policy and promotion (DIPP), ministry of commerce and industry told Business Standard. The LDB will consist of shipping line, port terminal operator, owner of rail infrastructure, container train operator, customs agent, truck operator and shipper or consignee.

The government plans to replicate the model for other industrial corridors as well if the service becomes successful in the DMIC region. The data bank, which will also be known as DMIC Logistics Data Bank, is aimed at improving competition, reducing transportation lead time and cost by sharing container movement information among all agencies in the supply chain using an IT-based platform. This was also discussed during a meeting between Minister of State (Independent Charge) for Commerce and Industry Nirmala Sitharaman and Japan’s Minister of Economy, Trade and Industry Yoichi Miyazawa held here last month, when both sides signed an ‘Action Agenda for the India-Japan Investment and Trade Promotion’.

In terms of revenue earning for the government, the data will be collected from all stakeholders for a fee with user charges collected from shippers based on mandatory user charge, which will be 0.2 per cent of the total transportation cost, Kumar said. Presently, almost 60 per cent of the container traffic is concentrated in the western corridor.

Besides, several stakeholders such as the railways, ports, customs and transporters operate their own IT-enabled systems without sharing the data with each other.

SMART PROJECT

• The service will ensure speedy movement of two-way merchandise trade by way of real-time tracking of container and cargo movement.
  

 

Once in operation, the LDB is expected to save $3.2 billion annually by 2017.
 

The LDB will consist of shipping line, port terminal operator, owner of rail infrastructure, container train operator, customs agent, truck operator and shipper or consignee.