What ails the Goan logistics sector?

NLP & Goa: State drastically lags behind in basic logistics infra

PANAJI: While the standard of living in Goa may be higher than other States, it drastically lags behind in terms of basic and essential infra for logistics and transportation.

Goa fares very poorly on the logistics front and ranks only 18 among the 21 states (which were surveyed) in the country, according to the 2021 LEADS survey (Logistics Ease Across Different States).

It is just above the last 3 states on the LEADS list and shares space with Bihar, Himachal Pradesh and Assam.

Besides, Goa has scored as low as 2.84 in 2021, compared to Bihar’s 2.77, Himachal’s 2.75 and Assam’s 2.63.

Which means in terms of logistics and transportation, Goa is among the last 4 States in India, which is a crying shame, given the fact that in the Standard of Living index, Goa is among the top 3.

While other States are concentrating on the planning and implementation of the National Logistics Policy (NLP), Goa lags terribly behind even in basic logistics infrastructure.

As a precursor to the implementation of the NLP, India has pumped in nearly Rs 15 lakh crores to improve roads, rail, ports and airports – critical infrastructure for logistics over the last 5 years.

Digitization of all records and automation of all processes is also moving quickly giving the country the right atmosphere and ambience for the NLP implementation.

A noticeable increase in efficiency and reduction in transportation expenses which the National Logistics Policy promises will greatly benefit businesses by making products available at appreciably lower cost.

The NLP seeks to address challenges facing the transport sector and bring down the logistics cost of businesses from 13-14 per cent to a single digit with the target being around 6 to 7 per cent.

This will greatly benefit the hospitality and tourism industry in Goa which heavily depends on logistics and reduce input costs and inventory and make procurement streamlined and cost effective.

When it comes to infrastructure related to rail, road, multi-modal and uni-modal transport, warehousing, power, communications and logistics services, including the capability and expertise of logistics service providers unfortunately Goa is at the bottom of the list.

Goa as a State drastically lacks cold chains, food parks, APEDA and MPEDA approved labs (for product testing) and pack houses, besides other basic infra required to make a state logistics’ friendly. Further time and cost of cargo offload in Goa is a major cause for concern.

Other issues that the plague the State include the security at terminals and warehouses, internet and statewide fiber connectivity, reliable power supply and the capability of local or last mile logistics service providers. Road freight rates, manpower costs and prices of terminal services are unreasonably high in the State, making it the least preferable in terms of an interstate logistics hub.

Goa has miles to go when it comes to making it a good logistics destination. Local resistance to change and development is another factor that has inhibited progress in the coastal state that is lagging behind others.