Multimodalism as a concept is the movement of cargo from the origin to destination using multiple modes of logistics under a single contract. Each mode might be operated by a single carrier or multiple carriers. The company or the agency overseeing the contract is responsible for moving the cargo from the origin to destination.1 Cement in India is currently transported using multimodal logistics through all principal modes, ie, roads, rail and waterways. Being a hygroscopic material, cement needs to be delivered to the end consumer in a time bound manner.2 Considering the high volume of cement that is transported each year across the Country, efficient transportation and reliable storage are crucial elements of the Cement Industry value chain.
The Indian logistics market is currently valued at USD 215 billion and is growing at a CAGR of 10.5%.3 The needs of a rapidly growing market are constantly evolving and multimodal logistics can offer a solution to enhance logistics efficiency. The multimodal transport operators who provide multimodal logistics services, take care of all modes of transport, handling, warehousing and distribution from the origin to the destination. This can optimise resource utilisation and drive efficiencies across the supply chain.4
Government initiatives are also suggestive of transition toward multimodal logistics. The recently launched Prime Minister Gati Shakti Scheme offers a National Master Plan for driving multimodal connectivity across the Country. It will bring together 16 Ministries including Ministry of Railways and Ministry of Road Transport and Highways (MoRTH) for integrated planning and coordinated implementation of infrastructure connectivity projects. The Mumbai Port Trust has taken a lead under the scheme. It is undertaking a number of cargo and sea tourism projects to promote multimodal connectivity. The Indian Railways is also considering creation of nearly 500 multimodal cargo terminals in 4-5 years under the PM Gati Shakti scheme.5
The National Logistics Policy, which is expected to be launched shortly, has a significant focus on multimodal logistics as well. Under the Policy, the current modal mix of roadways (60%), railways (31%), and waterways (9%), will be optimised to roadways (25-30%), railways (50-55%), and waterways (20-25%), in line with international benchmarks.6 According to the Policy, MoRTH and the National Highways Authority of India (NHAI) will set up a network of 35 Multimodal Logistics Parks on a Public Private Partnership (PPP) basis.7 The Department of Commerce is also considering introducing a National Logistics Efficiency and Advancement Predictability and Safety Act to streamline and modernise the logistics sector by promoting digitisation and reduce the logistics cost. The Act is expected to provide the necessary push to trade, improve India’s export competitiveness, and help India improve its ranking in the World Bank’s Logistics Performance Index and Ease of Doing Business.8
Multimodal transport offers a number of advantages such as the ability to serve a wider range of markets, increased handling and delivery time efficiency, enhanced security, optimised transport costs, one contract allowing easier freight tracking etc.9 A single company agent managing the entire chain from the origin to destination can also help optimise resource utilisation and drive efficiencies across the supply chain.10
In addition, multimodalism offers a number of environmental benefits. Roads have the highest air pollution and greenhouse gas emissions11 at INR 0.202 per tonne per km (ptpk) and INR 0.0031 ptpk respectively. In comparison, rail (INR 0.0366 ptpk and INR 0.0006 ptpk) and waterways (INR 0.03 ptpk and INR 0.0006 ptpk) have lower air pollution and greenhouse gas emissions respectively. Considering that a single inland waterways vessel or a full Indian Railways rake can carry over 2,000 tonnes of cargo, which is equivalent to 125 trucks carrying 16 tonnes each, optimising movement across all the three logistics modes can significantly reduce air pollution and greenhouse gas emissions. 11 These advantages make multimodal transport suitable for driving energy efficient operations and promoting environmental conservation. This will also help India align with the United Nations Sustainable Development Goals.
Multimodal transport offers an efficient and optimised mix of rail, road and waterways movement. Multimodalism can unlock an environment friendly, energy efficient and economically optimised mode of moving cargo, including cement. The benefits accruing from the various modes can be unlocked especially at the interfaces. Under an ideal scenario, rail and waterways could be considered for long distances while roads could be considered for shorter distances.12 This would provide win-win solutions for all the stakeholders involved. Under such a scenario, regular stakeholder consultation become crucial to develop a holistic perception in the matter.
