Strengthening Multimodal and Integrated Logistics Ecosystem Program

Recently, the Asian Development Bank (ADB) has approved a $250 million policy-based loan to support the Government of India’s wide-ranging reforms that aim to strengthen and modernize the country’s logistics infrastructure, improve efficiency, and lower the cost in the logistics sector.

• The loan will finance the first sub-program of the Strengthening Multimodal and Integrated Logistics Ecosystem Program.

Strengthening Multimodal and Integrated Logistics Ecosystem (SMILE) Program: It is programmatic policy-based loan (PBL) to support the government undertake wide-ranging reforms in the logistics sector in India.

• It aims to strengthen the institutional and policy framework for inter-ministerial coordination and planning for incentivizing private sector participation in multimodal logistics projects, improve efficiencies in external trade logistics, and encourage the use of smart and automated systems for improved service delivery.
• The proposed programmatic PBL modality with two subprograms of $250 million each, in FY2022 and FY2024.

Impact: Strengthening Supply Chains: The program 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.

• Rationalize Cost: This will rationalize India’s high cost of logistics and reduce greenhouse gas emission.