[Answered] Increased adoption of the railways for cargo movement is crucial to improve the country’s logistics competitiveness. In the light of the statement, highlight the significance of the railways for India’s logistics.

Logistics includes all activities of the supply chain such as transportation, warehousing, packaging, inventory management, the flow of information, order processing and customer service. To increase the share of the railways in freight movement from 27% to 45% and increasing freight movement from 1.2 billion tonnes to 3.3 billion tonnes, by 2030, PM Gati Shakti provides the right platform to address the infrastructural challenges that have hampered the movement of freight by rail.

Significance of the railways for India’s logistics:

• Trains are not just the safest way to transport freight – they are also green and among the most energy-efficient mode of transportation. Because they generate up to 80% less CO2 and consume 75-90% less energy for freight traffic than road transport.
• Currently, Indian roadways handle 70 per cent freight when compared to 18 per cent by railways. So an increased burden on roads causes significant congestion, increased pollution, and resultant logistics cost escalations.
• Freight movement cost is the highest in the road sector- nearly twice the rail cost.
• A robust rail network will augment the transportation system that will attract more investment in India. This will aid in enhancing the current manufacturing capacity of the nation.
• A commodity mix that has a high share of bulk goods is suitable for rail’s bulk-handling capabilities.
• Freight travel is often over longer distances which is suitable to rail’s economies of scale relative to road transport.
• India has a low coast-to-landmass ratio. Between the two low carbon freight modes, rail and coastal, India’s geography makes rail more feasible in many areas of the country as compared to coastal.

The Railways offer an efficient and economic mode of logistics movement given their pan-India network, and can play an important role in enabling a coordinated and integrated logistics system.