ADB approves $250 million loan to strengthen logistics sector

“The loan will finance the first sub-programme of the Strengthening Multimodal and Integrated Logistics Ecosystem Program, which supports the government’s efforts to create a comprehensive policy, planning, and institutional framework at the federal, state, and city levels,” an ADB statement said.

This will rationalise India’s high cost of logistics and reduce greenhouse gas emission, the statement added.

The programme will help to strengthen supply chains by simplifying external trade logistics and domestic cargo movements, modernizing warehouses, improving business processes with integrated digital platforms, and stimulating private investments in the sector.

India’s recently approved National Logistics Policy and the Prime Minister Gati Shakti–National Master Plan provide transformative institutional and regulatory frameworks for holistic development of the logistics ecosystem in the country and lays the foundation for building a modern and efficient logistics sector.

“Efficient movement of goods from production and distribution centres to both domestic and external markets is critical to lowering costs and enhancing productivity and competitiveness. Manufacturing, services, and trade in India stand to benefit immensely from the significant reforms in the logistics undertaken by the government,” said ADB South Asia Department Director of Public Management, Financial Sector and Trade Sabyasachi Mitra.

To facilitate multimodal logistics, the sub-programme promotes reforms that reduce cumbersome processes that businesses face to obtain approvals for cargo clearance as well as the creation of digital systems that integrate regulations, processes, and logistics data. The programme promotes the facilitation of cargo movement through coastal shipping and inland waterways to strengthen multimodal transport.

The programme also supports the Ministry of Commerce and Industry’s initiatives to issue standards for warehousing, which would encourage operational efficiency and private sector investment.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members — 49 from the region.