How Indian logistics can revamp despite coronavirus pandemic

The last fortnight has been the most difficult time for the logistics industry. Fifty percent of the 12.5 million heavy, medium, and small commercial vehicles have shut their engines because of coronavirus.

There are no drivers, no loaders, and no unloaders to support the $200 billion logistics industry. However, technology firm LogisticsNow makes some recommendations on how Indian logistics should change immediately and carve out a new future. 

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This is perhaps the best time to create a National Registry of Truckdrivers, according to LogisticsNow. One of the major challenges today is that truck drivers who have gone home are difficult to trace and it is even more difficult to bring back them. This is likely to result in losses for the transporters and the nation at large. The registry will enable the government to request and arrange for safe passage of truck drivers in such times of need, to enable rapid mobilisation.

“COVID-19 is not going to go away and India should fix its supply chain if this problem persists and we can help this ecosystem go digital,” says Raj Saxena, Founder and CEO of LogisticsNow. 

Following are some of the observations and recommendations made by LogisticsNow:

The situation

1) 50 percent of India’s organised long-haul trucking fleet is now without drivers, who have gone home.

2) Local short-haul transport, though less impacted, is working with reduced capacities. 

3) Trucks, including those carrying essentials, are still stuck for reasons including want of labour to load/unload.

4) Railways is stepping up and can serve on some sectors, but the gap is large; First-mile and last-mile may be a challenge with rail.

After talking to business leaders in Amul and Godrej, the LogisticsNow team believes that letting trucks pass only helps if they are unloaded, can return, and load again.

“While the government has moved fast by constituting a logistics committee, we need actions that can help scale the logistics response to COVID-19 in the days and weeks to come,” says Raj Saxena.

Need a nation in sync with supply chain

The entire chain is being impacted. From raw materials and packaging material supply to manpower at manufacturing plants (to load/unload/operate) to logistics, and transport to retail. The imbalance in the supply and demand networks is likely to reach alarming proportions unless emergency measures and strong public-private sync is created immediately, on a regular basis. 

This sync could span national leadership from Central, State, and local leadership and other key stakeholders, including civil society and NGOs. 

“Now, more than ever, there is a need for a tightly-knit mechanism to ensure that the nation and its key assets and allies in this war are in sync,” says Raj Saxena. 

Scale-up manufacturing of essentials

No country can afford its manufacturing capacity for essentials like food and medicines to be less than optimally utilised in this time of need. Supply chains and manufacturing have to be supported throughout, while being in close sync with demand, with a joint effort from corporates and the government departments concerned.

Adhoc capacities for emergency demand of ventilators, testing kits, and essential medicines have to be created quickly. A few corporates have already started, but a lot more needs to be done given the projections of COVID-19 spread for April and May.

There is a need to rapidly scale up manufacturing capacity for every aspect of the COVID-19 response spanning medical supplies, ventilators and other related equipment, food, and FMCG and pharma distribution.

Unlock inventories for retail consumers

Inventories of essentials already in the chain need to be unlocked immediately so that while manufacturing and transport (inter-state) get back on track from the initial disruption, local inventories with distributors are made available to retailers as required. 

Secondary and last-mile transport capacity needs to pro-actively be kept ready to distribute all inventory to retailers. In some areas, the local administration may need to issue orders for all distributor inventories of essential items to be sent to retail, especially modern trade where anti-hoarding, rationing and MRP regime can be enforced.  

Build / re-build transport capacity

As transport capacities have been disrupted by stranded trucks, drivers going home etc. across the country, there is likely to be a need for thousands of trained drivers/trucks to move essential supplies. 

All options including the Army Supply Core (ASC), Indian Railways, CONCOR, Freight Marketplaces, and Freight Intelligence networks along with large fleet owners/truckers who can provide transport capacity from long-haul to last-mile, quickly, would enable an effective response.

A quick way to build last-mile transport capacity would be to partner with e-commerce companies and online pharmacies/other online delivery players which have built distribution capacity and focus this entire capacity on the distribution of essentials with permits/curfew passes etc. enabled by mobile technology and an orchestrator to centrally manage and coordinate this capacity. 

“It would be important to train e-commerce delivery teams to stay safe and execute deliveries of essentials rapidly to enable isolation/quarantine/care for those infected as also to service homes and hospital inventories,” says Raj.

Vaccine distribution capacity

The vaccine for COVID-19 will come. And transporting it in reefer trucks to the farthest districts in a country which already has a shortage of reefer trucks can only be accomplished by planning in advance and executing rapidly when the vaccine comes. An unprecedented level of planning and public-private partnership can perhaps create the fastest COVID-19 vaccination programme in the world to save lives.

Replenish pro-actively

Further, in sync with the modelled spread of COVID-19 in India, there is a need to stockpile (pro-actively, before community spread starts and thereafter) inventories of ventilators, testing kits and other essentials in each district which is likely to have large numbers of COVID-19 cases. Institutes like the National Institute of Virology, ICMR, AIIMS and IIT/NIT can collaborate to create this model which will be instrumental in saving lives in case our hospitals overflow and patients have to wait for ventilators and essentials.

Build AI-powered payment systems

India created the IndiaStack for payments, resulting in the digital payments revolution unprecedented in our history. A similar digital logistics revolution is required in our supply chains and transportation. 

(Edited by Javed Gaihlot)