LOGISTICS PERFORMANCE INDEX (Syllabus: GS Paper 3 – Economy)

Context: Recently, a crucial meeting was convened under the chairpersonship of Special Secretary (Logistics), DPIIT, MoCI, focusing on Measures Taken and Action Plan to enhance India's Logistics Performance Index (LPI) ranking, bringing together nodal officers from the LPI dedicated cell established in eleven Stakeholder Ministries/Departments.

Logistics Performance Index (LPI)

• About: It is an interactive benchmarking tool that helps countries identify the challenges and opportunities they face in their performance on trade logistics.
• Released by: World Bank
• LPI 2023 Total Countries: 139
• Parameters: (i) Customs., (ii) Infrastructure (iii) Ease of arranging shipments (iv) Quality of logistics services (v) Tracking and Tracing, and (vi) Timeliness
• India’s Rank in 2023: 38th by jumping 6 places in 2023.

India’s Logistics Sector

• Contribution to GDP: 15%
• Logistics Cost: 13-14% of GDP (compared to 7-8% in developed countries).
• Impact on Exports: A 10% decrease in logistics cost can increase 5-8% of exports.
• Sub-National level: The Department for Promotion of Industry and Internal Trade (DPIIT) has been conducting LEADS (Logistics Ease Across Different States) study since 2018 which helps to identify and resolve logistics inefficiencies and improve trade facilitation across supply chains.