Economic Survey 2023: PM Gati Shakti and National Logistics Policy to support domestic manufacturing, export competitiveness

The Economic Survey 2023 noted that the infrastructure expansion has come at a time of crisis when the capital expenditure by the private sector has been subdued. (Representative Image)

India's domestic manufacturing and export competitiveness will be driven by the likes of the Production-Linked Incentive (PLI) scheme, PM Gati Shakti and National Logistics Policy (NLP), the Economic Survey, tabled by Finance Minister Nirmala Sitharaman in Parliament on January 31, said.

"Further support to economic growth will come from the expansion of public digital platforms and path-breaking measures such as PM GatiShakti, the National Logistics Policy, and the Production-Linked Incentive schemes to boost manufacturing output," the survey said.

Union Minister for Finance, Nirmala Sitharaman on January 31 tabled in Parliament the Economic Survey 2022-2023, which reviews how the economy performed in this fiscal year and the road ahead for the next year.

The survey added the government's aim to reduce logistics cost through the NLP and improve coordination between ministries will be key in boosting domestic manufacturing in the country.

The boost in domestic manufacturing will then attract foreign direct investment in the country as countries look to diversify their supply chains, the survey said.

According to the survey, Rs 1,458 crore has been spent as capital expenditure for the development of the PM Gati Shakti digital platform.

The GatiShakti Sanchar portal was launched on May 2022.

ECONOMIC SURVEY 2023: Catch all the updates here

Around 1,950 data layers of 22 ministries/departments and 36 states/union territories were mapped up to the village, district, and taluka levels on the national master plan portal which is being developed.

The survey also noted that following the announcement of the NLP and the first Logistics Ease Across Different States (LEADS) survey conducted in October 2022, 13 states/union territories have prepared and notified their logistics policies.

The survey also said that 12 states/union territories ranked in the 90 percentage under the LEADS survey conducted under NLP. Another six states ranked in the 80 percentage to 90 percentage and only 10 ten states had a score lower than 80 percentage.

The Economic Survey also said there has been 'unprecedented' infrastructure expansion in the last eight years with ports and airports having been substantially upgraded.

It noted that the infrastructure expansion has come at a time of crisis when the capital expenditure by the private sector has been subdued.

The centre’s outlay (target) for capital expenditure in 2022-23 (BE) was increased sharply by 35.4 percent from Rs 5.5 lakh crore in the previous year (2021-22) to Rs 7.5 lakh crore, of which approximately 67 percent has been spent from April to December 2022.

The economic survey also said that implementation of the NLP will be carried out through a Comprehensive Logistics Action Plan (CLAP).

The PM Gati Shakti - National Master Plan was announced in 2021 to break departmental silos and bring in more holistic and integrated planning and execution of projects to address the issues of multi-modal and last-mile connectivities.

The projects pertaining to seven engines (roads, railways, airports, ports, mass transport, waterways and logistic infrastructure) in the National Infrastructure Pipeline (NIP) will be aligned with PM Gati Shakti framework.

NLP was launched on September 17, 2022, addressing the components of improving efficiency in logistics through streamlining processes, regulatory framework, skill development, and mainstreaming logistics among others.

The aim of the NLP was to reduce logistics costs in India from the range of 14-18 percent of GDP currently to the global benchmark of 8 percent.

The targets for achieving the vision of the NLP are to reduce the cost of logistics in India to be comparable to global benchmarks by 2030, improve the Logistics Performance Index ranking - the endeavour is to be among the top 25 countries by 2030 and create a data-driven decision support mechanism for an efficient logistics ecosystem.