Commerce Ministry’s Logistics Division unveils plans for ‘Freight Smart Cities’

Need for Freight Smart Cities

• With growing urbanisation, requirements of rapid economic growth including e-commerce and associated first and last mile freight movements; increasing congestion, noise and sound pollution in the Indian cities is a menace affecting both public health and local economies.
• The Logistics Division under the Ministry of Commerce and Industry has decided to work in a planned manner to improve the city freight movement.
• This is all the more relevant as the demand for urban freight is expected to grow by 140 per cent over the next 10 years.
• Final-mile freight movement in Indian cities is currently responsible for 50 per cent of total logistics costs in India’s growing e-commerce supply chains.
• Improving city logistics would also enable efficient freight movement and bring down the logistics costs boosting all sectors of the economy.
• A shift from regulatory to a more organic approach making use of the enabling technologies is required to be adopted by the policy makers and city planners taking into account the aspirations of citizens and plan for their requirements.

Features of ‘Freight Smart Cities’

• The roadmap envisions the concept of ‘Freight Smart Cities’ to improve the efficiency of urban freight and create an opportunity for reduction in the logistics costs.
• Center also urged the State Governments to identify ten cities, to begin with, to be developed as Freight Smart Cities and also to set up institutional mechanism for the same involving the Government as well as Private stakeholders like Logistics services providers, users and citizens.
• States/City Governments are also asked to focus on the quick-wins like developing peri-urban freight centres, night-time deliveries, developing truck routes, using Intelligent Transportation Systems & modern technologies, Promoting electrification of urban freight , Parcel delivery terminals etc.
• Under the Freight Smart Cities initiative, city-level logistics committees would be formed.

1. These committees would have related government departments and agencies at the local level, state and from the reacted central ministries and agencies.
2. These would also include private sector from the logistics services and also users of logistics services.
3. These committees would co-create City Logistics Plans to implement performance improvement measures locally.

• On the Freight smart city initiatives, the Logistics Division is working closely with GIZ (Germany) under Indo-German Development Cooperation, Rocky Mountain Institute (RMI) and RMI India.

Way forward

• From the ten cities to be identified on immediate basis, it is planned to expand the list to 75 cities in the next phase before scaling up throughout the country including all state capitals and cities that have more than one million population.