Amar More, Director, Kale Logistics Solutions, stresses on the importance of good physical infrastructure and equally good digital infrastructure. He also talks about developing North America’s first next-generation air cargo community platform at the world’s busiest airport in Georgia.
What is the current status of the logistics and cargo industry?
The global logistics industry reached a value of US $4,730 billion in 2018, as per industry reports. In this, the Indian logistics industry is worth about US $160 billion in 2018, as per industry estimates and is riding a growth tide. Some of the drivers for growth in India are — a surge in the private equity activity due to relaxed FDI regulations, the impact of GST, rising consumer demand, boom in e-commerce, and boost in manufacturing. There are several regulatory factors such as diesel de-regulation, big thrust on building infrastructure, dedicated freight corridor and Make in India initiatives that are also influencing the industry. By far, these government-led initiatives have potentially redefined the logistics business in India. The Indian government’s focus on logistics is evident from the move to create a separate logistics ministry. The future looks promising for the industry in the long run. Having said this, in terms of creating efficiencies and adopting technology, logistics had traditionally been the last dark continent. However, it’s good to see the technology adoption and level of digitisation going up in the industry.
Where does the Indian logistics industry stand vis-a-vis the international market?
The logistics costs in India constitute approximately 13-14 per cent of GDP as against the 7-8 per cent in developed countries. This has also constrained the growth of the logistics industry in the country. On a positive note, India’s e-AWB ranking has risen significantly and is currently ranked sixth. The much-needed push for digitisation has been effective for the country, although there is still a long way to go. GST and its impact on the tax reforms of the logistics industry, although disparately received, has been positive overall. India has consistently been growing in strength with respect to the Ease of Doing Business Index and the Logistics Performance Index. We are optimistic about the latent potential of the Indian logistics industry.
What is the role of the government and the industry to bring about efficiency at work?
The government and industry have been quite proactive with respect to addressing the systemic challenges in the Indian logistics industry. The GST reforms, the focus on improving ease of doing business and the Indian customs’ participation in the AEO programme of the World Customs Organization (WCO) SAFE Framework of Standards to secure and facilitate global trade, and the push towards 24/7 customs clearance, are all examples of this commitment to bring about efficiency in the Indian logistics industry. The Indian government’s initiatives in civil aviation, the National Air Cargo Community Portal and the industry’s focus on community systems that nudge them forward in a collaborative and efficient push towards digitisation, are testament to their commitment to the growth of the industry. I personally believe that the government has great power in bringing about changes that can bring in the requisite efficiencies. We have seen this globally, that whenever there is a regulation that requires the industry to digitise, the industry laps up digitisation. The best examples are the customs declaration filing processes. In India, we have almost 100 per cent of this process completely automated. Similarly, GST, e-waybill nudged a lot of industry players to automate. I believe if the government can work closely with the industry to strike a balance between regulation and ease of operations and comes up with policies that require digitisation; our industry can levitate to much higher levels of efficiencies through technology adoption.
What are the changes that you would like to see about in making the industry more efficient?
To make the industry more efficient, we need good physical infrastructure and equally good digital infrastructure. The logistics industry could vastly benefit from investments in physical infrastructure such as better roads and inland waterways. Digitisation and connecting supply chain through electronic means is another way to ensure swifter and agile logistics ecosystems. Next-generation digital trade corridors, community systems and regulatory single windows are some of the solutions to the legacy challenges of the logistics industry and we would love to see the industry embrace these and flourish exponentially. India has pioneered some of these systems e.g. the community system at Mumbai airport is being emulated by several airports globally, the air cargo agents of India’s community platform UPLIFT helped India climb up to the sixth rank globally in e-air waybill rankings, the port user community system CODEX (Container Digital Exchange) in Tuticorin has enabled 100 per cent of exporters in receiving the IGST refunds within three days. We just need a formal approach in taking these initiatives nationwide to make our industry more efficient.
How would you like to contribute towards making these changes?
Kale Logistics Solutions has been at the forefront of contributing to the digitisation and trade facilitation initiatives of the logistics industry. Some of the feathers in our cap include – being cited in publications of KPMG as one of the top 10 innovations in the Indian logistics industry, being featured as a case study in the book written by professors of Kellogg Business School for our innovations in the logistics industry and being awarded e-Project of the Year at United Nations, Geneva.
Our collaboration platforms are accepted as global leaders and are being used worldwide. In fact, we are also developing North America’s first next-generation air cargo community platform at the world’s busiest airport in Hartsfield-Jackson Atlanta International Airport in Georgia. We wish to work even more closely with the Indian logistics industry and the government in ensuring that we proliferate these platforms across the country. With all our global successes and experience, we are sincerely working towards accomplishment of our PM’s vision of making our country feature in the top 50 in World Bank’s ease of doing business rankings.
How do you ensure that your company stays on top of its game?
The way to ensure that we stay on top of the game is to anticipate the changes and challenges that are coming to the industry and be the first ones to address the same. We participate and partner with several industry associations, in India and globally, to lobby with global regulators to effect transformation of the global logistics industry by effectively harnessing technology. We are constantly innovating and upgrading our software solutions to cater to the real-world challenges facing the logistics industry. Kale Logistics Solutions is a Microsoft Gold partner and we stay abreast of the latest technological updates, slog over meticulously on Proof of Concepts (POC) – such as Blockchain POC – and harness other futuristic technologies like Artificial Intelligence (AI), the Internet of Things (IoT), Machine Learning, Big Data and so on, that will likely prove to be a game-changer in their impact on the global logistics industry. Last but not the least, our strength is our team and our customers, through lasting partnerships with them we stay on top of the game.