The Commerce Ministry is considering replacing the Multi-Modal Transportation of Goods Act (MMTG) with a full-fledged national logistics law with a view to promote growth of the sector, a senior government official said on Saturday.
Special Secretary in the logistics division of the Ministry, Pawan Agarwal said a National Logistics Efficiency and Advancement Predictability and Safety Act (NLEAPS) is under consideration and this law tends to define various participants of the logistics space and create a light regulatory ecosystem.
“What the logistics sector is all about is not very clear to us as of now and in that direction, we need to clearly define what the logistics sector is and what the various elements in it are... We are considering replacing it with a full-fledged national logistics law.” NLEAPS is under consideration, he said at a webinar organised by industry chamber PHDCCI.
Multimodal transportation refers to a combination of more than one mode of movement, such as rail, road or sea, for end-to-end delivery of goods.
“We are working towards finalising a national logistics policy. We will be having consultations once the draft is finalised,” he added.
The move assumes significance as high logistics cost impacts the competitiveness of domestic goods in the international market. Effective implementation of the policy would help provide an impetus to trade, enhance export competitiveness, and improve India’s ranking in the Logistics Performance Index.
India’s logistics sector is highly fragmented and the government aims to reduce the logistics cost from the present 14% of the Gross Domestic Product to less than 10%.
According to an earlier statement from the Ministry, the sector is complex, with more than 20 government agencies, 40 partnering agencies, 37 export promotion councils, 500 certifications and 10,000 commodities.