AIR CARG O WEEK


WEEKLY NEWS


REDRAWING THE TRADE MAP


BY Ajinkya GURAV


05


INDIA’S logistics costs remain high—about 13 percent of GDP, compared to the OECD average of 8 percent. Lowering these costs is vital to meeting the country's goal of becoming a $1 trillion export economy by 2030. “Infrastructure


expansion must be matched by institutional


coherence,” Dr Jivisha Joshi Gangophadhyay, deputy secretary at the Department for Promotion of Industry and Internal Trade (DPIIT). “The National Logistics Policy provides the framework, but efficiency will ultimately come from the interfaces—where rail meets road, where ports meet airports, and where systems must speak to each other.” India’s PM Gati Shakti Master Plan, covering over 1,500 infrastructure


projects, is central to this vision. The initiative focuses on co-locating logistics assets—airports, special economic zones (SEZs), dry ports, and inland terminals—while linking them through digital platforms like the Unified Logistics Interface Platform (ULIP), which now connects over 160 systems across public and private sectors via real-time, API- enabled data sharing. Despite this progress, integration is uneven. While Delhi and Mumbai


handle more than half of India’s airfreight volumes, many smaller cities still lack effective multimodal connections.


Air-rail integration India’s rail network—already the fourth-largest in the world—handles just 27 percent of total freight volume. The Ministry of Railways aims to raise that to 45 percent by 2030. But integrating air and rail cargo remains a largely untapped opportunity. “We are yet to institutionalise rail-air intermodalism in a meaningful


way,” Dr Surendra K. Ahirwar, executive director at the Ministry of Railways, said.


www.aircargoweek.com


He highlighted the potential of the Western and Eastern Dedicated


Freight Corridors (DFCs) to support this shift. “Our long-term strategy is to pilot ‘air-rail transfer nodes’ near major cargo airports,” he said. These hubs would allow high-value, time-sensitive cargo—like e-commerce goods, perishables, and electronics—to transition swiftly between air and rail, cutting both costs and emissions. Dr Ahirwar also advocated for an “open access” model, allowing


multiple logistics service providers to share rail and cargo infrastructure. This approach could prevent unnecessary capital duplication and foster competitive neutrality in dense freight regions.


Aligning with global trade Logistics corridors are not only physical pathways—they are strategic tools shaped by geopolitics. India’s involvement in the India-Middle East-Europe Economic Corridor (IMEEC), along with broader efforts to diversify supply chains away from China, is altering trade flows. Yet, experts cautioned that airfreight is too often overlooked in “Trade with the EU—currently over €88 billion—is


these plans.


increasingly dominated by electronics, pharmaceuticals, and high- value textiles, where air cargo plays a pivotal role. If corridor designs ignore airborne freight, we risk misaligning our logistics investments with our trade profile,” said a senior consultant from a global trade advisory firm. To correct this, stakeholders called for cargo-focused SEZs near


airports, featuring integrated customs handling, bonded warehousing, and smart logistics systems tailored to the needs of airfreight.


Green corridors Climate policy is fast becoming a cornerstone of global trade strategy. Corridor performance will soon be judged not only by cost and speed, but by emissions. “Freight operators may gain preferential access to corridors based


on their emissions profile,” Dr Joshi said. “This aligns with global trends, especially in the EU, where border carbon adjustment mechanisms are under active development.” Carbon tracking is already being embedded into platforms like ULIP.


Some multimodal terminals are trialling solar-powered operations, electric vehicle fleets, and smart energy management systems. Emerging “green access scores” could influence fast-tracked customs clearance and preferred port access for low-emission providers.


Legal and regulator coherence Physical and digital integration must be backed by legal harmonisation. Despite widespread adoption of digital tools like e-air waybills and blockchain-enabled bills of


lading, legal enforceability across


jurisdictions remains inconsistent. Stakeholders highlighted the need for mutual recognition frameworks


based on UNCITRAL’s Model Law on Electronic Commerce. While India has made progress through bilateral digital economy agreements with the UAE and Singapore, broader frameworks for data sovereignty, e-documentation, and customs pre-clearance are still developing. “We need an institutionalised digital corridor governance model—


akin to air services agreements—tailored for trade documents, data sharing, and compliance protocols,” said a former trade official during a discussion on regulatory gaps.


23 JUNE 2025 ACW


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