India’s logistics sector is undergoing a transformative phase with the Strengthening Multimodal and Integrated Logistics Ecosystem (SMILE) Program, funded by the Asian Development Bank (ADB). This initiative is aimed at enhancing logistics efficiency, reducing costs, and developing multimodal infrastructure, thereby improving India’s global trade competitiveness. Under the visionary leadership of Prime Minister Narendra Modi, logistics reform has become a crucial component of India’s economic strategy, aligning with initiatives like the National Logistics Policy (NLP) and PM Gati Shakti National Master Plan.
Key Objectives of the SMILE Program
The SMILE program focuses on four key pillars to revolutionize India’s logistics landscape:
- Strengthening Institutional Frameworks – Establishing governance structures at national, state, and city levels for integrated logistics planning.
- Standardizing Warehousing and Logistics Assets – Improving supply chain efficiency by ensuring uniformity in warehousing practices, thereby attracting private sector investment.
- Enhancing External Trade Logistics – Boosting India’s performance on the Logistics Performance Index (LPI) through digital trade facilitation.
- Adopting Smart and Green Logistics Solutions – Implementing low-emission logistics systems to support sustainable supply chain practices.
Impact on India’s Logistics Performance
Efficient logistics are critical to economic growth, and India has been making significant progress:
- India’s rank in the World Bank Logistics Performance Index (LPI) improved from 54 in 2014 to 38 in 2023.
- Logistics costs currently stand at 12-14% of GDP, compared to 8-9% in developed economies. The Modi government aims to bring this down to 8% by 2030, making Indian industries more competitive globally.
- The implementation of NLP and Gati Shakti has reduced port dwell time from 100 hours to 48 hours, facilitating smoother trade logistics.
Aligning with Atmanirbhar Bharat and Make in India
By fostering an efficient logistics ecosystem, the SMILE program directly supports Atmanirbhar Bharat and Make in India by:
- Strengthening domestic manufacturing – A streamlined supply chain reduces production bottlenecks, improving output efficiency.
- Enhancing export competitiveness – Better logistics mean reduced lead times, improving India’s position in global trade.
- Attracting private investment – Standardized logistics infrastructure encourages public-private partnerships (PPPs), leading to a more robust logistics network.
Digital Transformation in Trade Logistics
The Modi government has emphasized digitalization as a key enabler for logistics efficiency. The SMILE program promotes:
- Unified Logistics Interface Platform (ULIP) – Integrating all logistics-related digital services under a single framework.
- E-Logistics Marketplaces – Facilitating real-time tracking of shipments, leading to 30% improvement in delivery efficiency.
- Paperless Trade Facilitation – Enabling faster customs clearance and reducing administrative bottlenecks.
Gender Inclusion in Logistics
A significant and progressive aspect of the SMILE program is its commitment to gender inclusion. The initiative includes:
- Gender audit of land ports to ensure women-friendly trade infrastructure.
- Assessment of Integrated Check Posts (ICPs) to improve gender responsiveness.
- Encouraging female participation in logistics workforce, aligning with the National Trade Facilitation Action Plan (2020-23).
Long-Term Benefits and Economic Resilience
The SMILE program is expected to:
- Create millions of job opportunities across warehousing, supply chain management, and trade logistics.
- Reduce logistics costs by up to 5%, improving India’s cost competitiveness in global trade.
- Increase private sector participation in infrastructure development, further strengthening the economy.
- Enhance India’s status as a global manufacturing and supply chain hub, boosting GDP growth.
The Narendra Modi government has demonstrated an unwavering commitment to transforming India’s logistics ecosystem, and the SMILE program is a testament to that vision. By integrating infrastructure development, digital innovation, and sustainable practices, India is set to emerge as a global leader in logistics efficiency. With initiatives like PM Gati Shakti, NLP, and SMILE, the government is not only improving trade logistics but also fostering economic growth and global competitiveness for Viksit Bharat 2047.
