Reduction of logistics cost by 10 per cent will help boost the country's exports by about 5-8 per cent, exporters body FIEO said Thursday.
Federation of Indian Export Organisations (FIEO) President Ganesh Kumar Gupta said that implementation of the Goods and Services Tax (GST) has helped growth of the logistics sector, which is very critical in increasing international trade.
High logistics cost impacts competitiveness of domestic goods in the international markets. The cost of logistics for India is about 14 per cent of its GDP and it is far high as compared to other countries.
"It is estimated that a 10 per cent decrease in indirect logistics cost can increase 5-8 per cent of exports," Gupta told reporters here.
He said this while addressing media over LOGIX-India 2019 programme.
The commerce ministry is working on a national logistics policy, which is aimed at promoting seamless movement of goods across the country and reducing high transaction cost of traders.
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He also said that to develop this sector in an integrated way, it is important to focus on new technology, improved investment, skilling, removing bottlenecks, improving inter modal transportation, automation, single window system for giving clearances, and simplifying processes.
Talking about the programme, Gupta said logistics companies from about 27 countries are participating in the three-day show in the national capital.
"LOGIX India 2019 is an initiative to improve India's trade with regions like Africa, ASEAN, Afghanistan, Iran, and Iraq," he said.
Over 130 International delegates representing logistics and freight forwarders professionals are attending the event.
FIEO DG Ajay Sahai said that through this, the federation will seek foreign investments and joint ventures in the sector.
Currently, India is ranked 44 in the World Bank Logistics Performance Index 2018 out of 160 countries.
The Indian logistics market, which is worth around USD 160 billion, is expected to reach about USD 215 billion by 2020, as per Economic Survey 2017-18.
The domestic logistics industry provides employment to more than 22 million.