Integrated infrastructure, a reality?

Transreporter - Integrated infrastructure, a reality?

Infrastructure continues to be weak and a big challenge area in India which has impeded the growth of logistic sector.  Of late the pace of infrastructure growth in India is visible with the increasing number of road constructions and highways that resonates with the government’s vision to drive economic growth. This growth has been propelled with a new integrated infrastructure programme, which aims to connect major modes of transportation roads, railways, waterways and airways.

However, the Indian logistics sector is largely skewed towards roads as an essential transportation mode with other modes like rail, air and water remaining largely unutilised, resulting in an adverse modal mix.  According to reports, logistics costs in India constitute about 14 per cent of the GDP, much higher than as compared to nations like the US, Europe, and Japan. Cargo movement is heavily dependent on its roadways. Nearly 60.2 per cent of the cargo is moved by road, 32.1 per cent by rail, and rest by the coastal shipping, airways, and inland waterways. Pipelines constitute a very minor proportion. While National Highways constitute only about 2 per cent of the road network of India, they carry 40 per cent of total traffic. As a result, most of these highways are severely congested resulting in delayed deliveries.

The government aims to bring the logistics cost by 10 per cent of GDP until the end of 2022. With state barriers now moving out, road transport is becoming simpler and faster as roads have improved a lot and normal turn-around-time (TAT) has reduced considerably. In case of railways, it is still not a preferred choice for logistics operations. 

Though rail is energyefficient, structural and manpower challenges make it not so preferred mode of transport. “Railways also introduced roll-on-roll-off (RoRo) trains, but even that could not take off on electrified routes because of the lack of clearance from overhead traction wires. As far as inland waterways are concerned, though the network is in place it has not been promoted well. Also, till the time, commodities start moving on the inland waterways, it is difficult to achieve economies which today make this mode of transportation a little expensive no matter that it is the most efficient and cleanest way of transportation,” said Sandeep Sharma , Founder & CEO , Cogent Transware Solutions.

Besides this, interoperability infra also comes as a major challenge in leveraging these modes of transport. “To reduce touch points for higher loads, RoRo services can work wonders as it will reduce TAT and make movement highly fuel efficient, and thus resulting in lower transport costs,” added Sharma.

While the issue with roads and highways revolve around tolls and uniformity of roads. “We have a heterogeneous road infrastructure (national  highways) ranging from less than two lanes (77 per cent)  and remaining are 4-6-8 lane roads.  The road network capacity remains less across some major trade hubs.  If we look at some of the major ports, the issue continues to be road connectivity around ports to the hinterland. The existing road connectivity across major ports is inadequate,” points out Ashish K Nainan, Research Analyst, Industry Research, Care Ratings.

Railways has been facing a capacity constraint in terms of railway line that could be dedicated to transport goods, adds Nainon. However, the country is witnessing freight corridors coming up across major trade routes, but this has to be ushered in on an urgent basis in terms of implementation.

Experts suggest Dedicated Freight Corridor Corporation of India (DFCCIL) should develop logistics parks as points for aggregation/desegregation of cargo for movement by DFC. These planned logistics parks would also be ideal points for interface of cargo between road, rail and inland waterways modes.Other challenges include inadequate and low quality modal and terminal infrastructure, limited availability of multi-modal terminals, ill-designed storage facilities for cargo and containers, poor adoption of technology, lack of visibility of in-transit shipments, high fragmentation in the trucking industry, multiple checkpoints etc.

“There is an urgent need to shift the traffic off roadsby developing a robust multimodal infrastructure network to enable the use of different modes of transportation to seamlessly transfer cargo. Such a network will ensure that freight is moved through the most efficient mode for faster, safer, cost-effective movement,” says Kushal Nahata, CEO and Co-founder, FarEye.

The government has taken initiatives and launched several projects and schemes to strengthen the infrastructure for logistics movement.

Velvex