Transforming the transport sector – Removing roadblocks for growth

Authored by Arshdeep Mundi, Executive Director of Jujhar Group

India’s economy enjoys a strong pillar in the form of the transportation sector which provides a link between the rural and urban landscapes as well as the support for trade and industries alike. It further consolidates the nation, promotes its advancement, and enhances the reach of social services like education, health, and jobs. The development and planning of efficient modes of transportation are fundamental in the enhancement of the quality of life standards for millions of people. Despite this, however, the significance of the matter has made this sector quite complicated with issues that can undermine the prospects of achievement of the country’s economic targets. India aspires to grow its GDP to $5.5 trillion by 2027, but the transport sector is facing significant roadblocks. Even with billions of dollars invested, infrastructure development lags behind the economy’s rapid expansion. The immediate question is whether the transport sector can meet the demands of this growth or if it risks coming to a standstill.

Access to infrastructure in India is only getting catastrophic. Poor rural roads that are neglected make markets inaccessible, thereby increasing isolation and stunting economic opportunities. In metropolitan cities, traffic is disastrous because people spend hours in traffic jams, resulting in the waste of resources for the economy. Even the railways, once India’s pride, now suffer because of poor systems and unfruitful expenditures. 

India’s logistics costs are excessively high, standing at 13% of the GDP, while this figure is only 8-10% in developed countries. This makes Indian goods economically unviable as firms try to compete in the international market. This situation is worsened due to excessive dependence on road transport, which is costly and ineffective, as other modes of transport like rail and waterways are not being fully used. This transportation mix disparity deepens the crisis, making long-distance freight expensive and thereby increasing the cost of goods.

Environmental ones complement the economic consequences since transport is among the main sources of pollution and climate change. Gasoline vehicles and inefficient mass transport have resulted in cities with dangerous air quality in India. The health implications of air pollution, especially in big cities caused by car engines, are severe, with millions suffering from airborne diseases, which warrants urgent rectification. There is a risk that if this situation is not changed, the damage to the environment might escalate and even worsen the country's problems.

Despite these challenges, there is hope as India has initiated measures to address them. Government projects like the Bharatmala Pariyojana aim to build extensive highways to improve accessibility and reduce travel time. Additionally, plans for Multimodal Logistics Parks (MMLPs) seek to integrate road, rail, air, and sea transport, minimising inefficiencies and enhancing cost-effectiveness.

There is also a rise in sustainability initiatives, with the adoption of EVs becoming an effective strategy for emission reduction and curbing air pollution. Also, the launch of the National Electric Bus Program (NEBP) is a milestone in promoting cleaner modes of transport. In addition to this, investments in charging infrastructure powered by renewable sources are also very important for the cause of a greener future.

To achieve this shift, skill development efforts are also being implemented. A variety of courses are being conducted to provide the necessary skills for the workforce to operate sophisticated technology and modern supply chain processes. These endeavours are particularly critical in ensuring that India’s transport industry can adapt to the structural changes within the industry to compete successfully in international marketplaces.

The country’s transport sector stands at a turning point. While there is no denying the challenges, the opportunities for change are equally clear. With the proper steps and speed, the country can fully transform the transport sector, enhance economic growth, and ensure environmental sustainability. Failing to address these concerns may exacerbate the ongoing crisis, leading to even greater costs in the long run. What today’s leaders decide on will define the future of the transport industry in India.

DISCLAIMER: The views expressed are solely of the author and Adgully.com does not necessarily subscribe to it.