Need of skills in LEADS
Logistics ease Across Different States (LEADS) Report, 2021 aims at gauging the logistics performance of States Union Territories and at the same time pinpointing the areas where they can make improvements with respect to the logistics. Actions are taken by each state to improve ease of storage and movement of goods and to improvise different elements of logistics.
The government’s step towards “Atma Nirbhar Bharat” has led the Central Governments to improve the logistics ecosystem across the country. Hence this ‘to be’ improved ecosystem, along with the federal structure, helps to improve trade competitiveness.
LEADS in the Past Years
In 2018, LEADS had the objective of ranking States and UTs on the efficiency of their logistics ecosystem. Here the Index evaluated the EXIM logistics ecosystem in States with perception-based feedback of stakeholders. In 2019, LEADS evaluated both – EXIM and the domestic logistics ecosystem based on a Perception-based survey of stakeholders. In 2021, LEADS has introduced Objective survey instruments, and the index is based on 21 indicators – out of which 17 are perception indicators and 4 are objective indicators. Additionally, statistical methodologies to build indexes have also been updated to get more robust results based on the changing framework.
Gujarat, Haryana, and Punjab have emerged as top performers in the LEADS 2021 index with well-developed infrastructure and services and Improved policies. The department of Commerce continuously engages with all the States and UTs to facilitate and promote improvements in the overall logistics ecosystem.
The OECD has projected certain global growth and new numbers which have helped us to look at the situation more clearly. With the resumption of the economic activities after the decline in the pandemic, the strong policy support, and the deployment of effective vaccines, a global growth recovery has been observed to be 5.7% and 4.5% in 2021 and 2022 respectively. Trade in Asia is expected to grow at 14.4% – this might lead to supply-side issues such as semiconductors scarcity and Port Backlogs straining the supply chains in the Trade. To overcome this, companies have implemented more focused strategies and networks with customers, suppliers, and stakeholders globally. India being the preferred investment destination, can come out as the perfect opportunity for global companies and for most of the countries.
As mentioned above, in 2021, LEADS have 2 major changes – First being the Objective Parameters (17 being perception indicators & 4 being Objective indicators) in order to evaluate the Index through objective survey instruments and the inclusion of data variables for logistics ease. The second was the new statistical methodologies for factor analysis.
LEADS 2021 continues to base along the 3 dimensions under the perception indicators – same as 2019 – Infrastructure, Services, and Operating and Regulatory Environment covering under 17 parameters
Under the objective indicators, there are binary questions and secondary data sets along with survey instruments such as sampling, Data collection, Data analysis, and statistical modeling.
To understand the dynamics of logistics in the 3 above-mentioned dimensions, an inter-cluster comparison was implemented on the basis of respective indicator scores amongst these clusters
State’s performance Index – 2021
Gujarat is the top performer of LEADS 2021 in an overall satisfaction for indicators of “Availability and Quality of Infrastructure, Extent of Facilitation and Ease of Obtaining all Approvals”.
Along with being the topmost performer, certain issues and challenges regarding Infrastructure, Services, and regulatory and operating environment are also discussed by the Industry stakeholders.
To deal effectively with such scenarios, actions have been taken based on the LEAD 2019 recommendations.
Suggestive initiatives for States and UTs
Overall logistics costs can be brought down by the states and UTs if they have an enabling policy, regulatory and institutional mechanism in place for the logistics sector. All three major sectors of economic activity agriculture, manufacturing, and services can be greatly impacted by the reduction in logistics costs.
Some of the ways by which States/UTs can play their part in supporting the integrated development of India’s logistics sector are given below:
- Framing State Logistics policy and State Logistics Master Plan
A progressive State Logistics Policy can provide proactive interventions to the challenges faced by the logistics sector. This policy can act as a guiding framework for the development of the logistics sector. The logistics Policy can help the State by boosting its economic competence along with helping the logistics sector by providing a sustainable, and integrated policy framework for strengthening the industry.
- Establishing a robust institutional mechanism
The fragmented approach to logistics of having multiple agencies is leading to constrained growth of the sector. States/UTs can appoint a Nodal Officer for the Logistics sector and constitute a State Level coordination committee who helps in providing direction to the efforts in pursuing the logistics policy and enabling coordinated efforts across State departments to improve logistics in the State.
- Establishing effective grievance redressal and dispute resolution mechanism
Fast-track resolution of grievances faced by stakeholders in logistics is the need of the hour. A common platform can be provided for logistics stakeholders to voice their grievances and facilitate the faster solution of issues.
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