In our previous blog, we explained How good is India’s road infrastructure?. Here we will focus on the Limitation of the mode of transport affecting the last mile delivery- connectivity between road and rail infrastructure. We write a separate blog about this as it is one of the popular question asked by foreign companies who import goods in India, sell in India, developing & managing distributor network in India. This particular blog helps you understand the limitation of the mode of transport affecting the last mile delivery in India.
Limitation of the mode of transport affecting the last mile delivery- connectivity between road and rail infrastructure
In India, the movement of goods happens through air, rail, and road. Transportation of goods by air is not only expensive but also has a limited presence (plagued by limitations of the frequency of flights, airport locations, and connectivity). Indian railways provide a better transport solution for organizing deliveries at cost-effective prices to every nook and corner of the country. If none of this works, then movement by road is the most preferred option of corporate.
“The most crucial aspect of the delivery of goods is safety.”
In the case of air and road transport, the claims process of insured goods is straightforward. The insurer identifies the risk and negotiates the loss value with the supply-chain defaulter. While in the case of train, it becomes challenging as railways in India is a state-owned entity (a Government of India Enterprise). As a result, corporate avoid the movement of goods through railways.
A combination of air and surface transport gets employed for faster delivery of goods. The goods get picked up from the source by trucks and get delivered to the airport. From here its gets sent to the destination airport, and after which it is further distributed through road.
A similar combination is also possible via railways, but the real challenge is the scarcity of trucks/smaller vehicles in isolated areas. It hampers the government’s attempts to decongest cities and also affects development plans for logistics and warehousing hubs in the remote areas.
In the remote areas, developing infrastructure for surface transportation has been a challenge, but with government policies in support of promoting businesses in remote areas through the introduction of various incentive schemes (to generate local employment) and with extension of tenure of long term land lease for businesses for building logistics hubs of international standards, etc., will help develop combinations of rail and surface.
The day is not far when railways would be the most preferred option for local distribution. Streamlining of the process of insurance claims is being made through industry representations.
For the last 20 years, Maier+Vidorno has been addressing these business needs of overseas companies. Our registrations allow us to import a vast number of products into India. We have extensive distribution networks and warehousing options for all types of goods. We also offer support services in areas of sales, service, finance, accounting, and HR consulting. Contact us to know more.