All about National Logistics Policy 2022 and 10 facts

A national logistic policy is basically formulated by the government authorities. This policy will focus on critical areas, such as process re-engineering, digitalization, and multi-modal transportation nationally and internationally. It is a crucial step since high logistics costs hurt domestic goods’ ability to compete in the international market.

What is the National Logistics Policy? 

The national logistics policy was made so the logistics sector could become a key driver of economic growth. This will be done by doing businesses, government agencies, and society works together better and more closely. The goal of the NLP conference 2022 is to build a robust logistics ecosystem that includes all stakeholders from different sectors, such as industry, agriculture, trade and commerce, manufacturing, services, etc.  The national logistics policy also gives a plan for making it easier for goods to move around by improving the quality of traffic management systems and making it easier for goods to move around with modern infrastructure for all kinds of transportation, such as roads, trains, waterways, etc.

National logistics policy 2022

Aim of the NLP

This National logistics policy for 2022 will focus on three main areas: process re-engineering, digitization, and multi-modal transportation. It’s an important choice because high logistics costs hurt domestic products’ competitiveness in the international market. The national logistics policy 2022 was thought to be needed because logistics costs are higher than in most other industrialized countries. Logistics manages materials, supplies, hardware, consumables, foods, and other things that can be seen and touched. Logistics is a process that involves many different kinds of service, such as making, stocking, packaging, regular security, warehousing, and moving. Different kinds of logistics are essential to know about. This article will tell you a lot about the five most important types of logistics policy points. So let us dive in!

Inbound Logistics

With inbound logistics, strategic organizational tasks for working upstream are carried out. Under this type of logistics, information and products from suppliers are moved, transported, and stored before being sent to the warehouse and then to the production facilities for further processing and production. Inbound logistics is how companies and their suppliers move things back and forth. The national logistics management plan uses order-fulfillment systems or automatic ordering to handle incoming logistics more efficiently. With this integration, you can expect to improve the things that make your organization successful. For example, if you make car parts in your factory, you will need to ship them to businesses or recipients like manufacturers so they can put them on the finished cars. The job of inbound logistics is to get the raw materials to the proper departments or manufacturers so they can be worked on further. Most of the time, these rough raw materials are moved by big trucks. National logistics management has an extensive network of people and big trucks that can safely move goods without spending much money. It is the first step in the logistics value chain, and it is essential to try to improve the flow of the process so that it does not slow down the other efforts. 

Outbound Logistics

Outbound logistics is moving products or finished goods from where they are made to the following link in the supply chain. Then, these items are moved from the warehouse to where they will be used or to the customers. Therefore, order fulfillment is another name for outbound logistics. Through this process flow, end users will be shipped under outbound logistics. Inbound logistics is used to get the raw materials to the manufacturer. Outbound logistics is then used to get the finished product to the people who will use it.

Reverse Logistics

As the name suggests, reverse logistics moves goods or products from the end users back to the supply chain. Reverse logistics is needed when products need to be changed out or sent back to be fixed, exchanged, thrown away, or recycled. Reverse logistics is mainly done after a sale has been made. It is primarily used in the electronics and auto industries, but it is also used for products in all other sectors. Let’s say you send out a product that doesn’t do what it’s supposed to or is made wrong. You will have to send it back to the seller so they can fix it or give you a new one. It takes reverse logistics to get the job done well in these situations.

Third-Party Logistics 3PL Logistics

Third-party logistics, or 3PL, is when operational or e-commerce logistics are outsourced to a third-party logistics company. This company then takes care of everything, from managing the inventory to delivering the products. This lets business owners focus on their business while a 3PL provider takes care of order fulfillment smoothly. A 3PL company offers a wide range of services that help with the supply chain’s logistics. The benefits include shipping, storing, managing inventory, picking and packing, freight forwarding, and returns/reverse logistics. Read more about saas solution for inventory management

Fourth Party Logistics 4PL

Companies use 4PL, or fourth-party logistics, to give all their logistics tasks to a single logistics partner. The logistics provider would manage the whole supply chain, which includes evaluating, designing, building, running, and keeping track of the client’s supply chain solutions. This is why a 4PL logistics partner is a better way for the client to manage the supply chain.

10 facts about the National Logistics Policy

• In the next five years, the policy is expected to cut logistics costs, which comprise about 15% of GDP, to about 8%. It must considerably cut its logistics costs to make its exports and domestic goods more competitive. When logistics costs go down, efficiency increases in many areas of the economy, encouraging value creation and entrepreneurship. 
• The government wants to raise the country’s Logistics Performance Index (LPI) score so that by 2030, the country will be among the top 25.
• The government plans to build the Unified Logistics Interface Platform as part of the NLP conference 2022. It would put all digital services related to transportation on one platform, saving exporters from several time-consuming and hard-to-understand steps. Ease of Logistics Services (e-logs), a new digital platform, has just been released. Businesses can talk directly to government agencies about questions and concerns, which will help them get answers quickly.
• The logistics business is big, but it is not well organized. Through the policy, the government hopes to encourage the use of blockchain and AI in the country and help manage the mega-market.
• One of the logistics policy’s main goals is to make data-driven Decision Support Systems (DSS), which will help build a solid logistical ecosystem.
• Every state needs to set up a State Logistics Coordination Committee. The Logistics Ease will judge each state’s performance across the Different States (LEADS) index every year. The central government will make a plan for improving the efficiency of logistics. This will also let states set up their own logistics systems.
• This industry comprises about 20 leading government agencies and 40 smaller government agencies. There are also 37 export promotion committees, 200 shipping companies, 36 logistics services, 129 inland container depots, and 168 container freight terminals. There are also 50 IT hubs, banks, insurance companies, 37 export promotion committees, and 200 shipping companies.
• To put the Policy into action, a Comprehensive Logistics Action Plan (CLAP) will be used. This plan will focus on the following key areas:
• In 2018, which has a big economy, it was ranked 44th on the World Bank Logistics Performance Index list with a score of 3.18.

Highlights of the National Logistics Policy for 2022

Policy Implementation

A Comprehensive Logistics Action Plan will be used to put the policy into action (CLAP). The CLAP has eight key action areas that are broken up into eight types of interventions: National Logistics Policy 2022 Highlights Multi-modal integration: Diversification: NLP will make it easier for logistics to move from relying too much on roads (over 60 percent) to relying more on rails and waterways. Synergy: Flagship projects will work better because of this policy.

Use of Technology and Digitization

Use of technology and digitization: The Integration of Digital System (IDS) will connect 30 different systems from seven different departments, such as the customs, aviation, road transport, railways, international trade, and commerce ministries. National logistics policy ensures that cargo movement is continuously tracked.

Ease of Doing Business

The Ease of Logistics (ELOG) Dashboard would try to make things easier and make business more accessible. The System Improvement Group (SIG) would keep an eye on all logistics projects and make sure that problems in the sector were fixed. Under PM Gati Shakti, a group of secretaries called the Empowered Group of Secretaries (EGoS) has been set up to keep an eye on and review how the NLP is implemented. Many experts in the business world have taken over social networking sites to praise the national logistics policy. From what people have said so far, it seems likely that this is a great idea. However, it is still not clear if the policy will work to meet the long-term goals. Therefore, if you run a business that involves shipping and delivering products to customers’ front doors, you need to find the right logistics company to give you a wide range of services at a reasonable price. For more information contact us.