Page 14 - ITLN Jan-Feb 2023 for Magzter

Industry Report
Multimodal
Logistics Parks
MMLPs

India’s opportunity

to hack its logistics

Multimodal Logistics Parks is one of the most ambitious
infrastructure policy initiatives from the Indian government
to completely overhaul the country’s logistics from the point-
to-point movement to the hub-and-spoke model. But is that
enough? Aren't we missing something? Are there any gaps left?

Libin Chacko Kurian
n November 2022, the ministry of Management (NHLM), which has the
road transport & highways (MoRTH) mandate to develop these 35 MMLPs,
awarded the contract for setting up had to float a fresh tender for MMLP
IIndia’s first multimodal logistics Bengaluru. The earlier bid had resulted
park (MMLP) near Chennai at Mappedu in a single bid scenario with RIL only
to Reliance Industries (RIL) after it won entity qualified and was scrapped.
the bid in which Adani Logistics also Thus MMLPs come with their own
participated. challenges and gaps. MMLPs are
MMLP Chennai is being developed not the one-stop solution for all but
on 184.27 acres and has an estimated they can solve many inefficiencies in
project cost of ₹1424 crore. The MMLP the system. Starting from the lack of
will be developed in three phases with private players' participation to the be at least three to four players to
an estimated developer investment of lack of rail networks, the cumbersome ensure healthy competition,” he said.
₹783 crore. approval process to connecting the He is not sure how MMLPs will
“Phase-1 development is targeted by existing infrastructure and from time it reduce the logistics costs in the country.
2025 leading to commercial operations. may take to the level of collaboration it “India has high logistics costs primarily
MMLP at Chennai which is located 52 demands from the industry. due to its dependency on road against
km from Chennai Port, 80 km from rail. Unless and until we build enough
Ennore Port, and 87 km from Katupalli MMLPs: a reality check rail networks, the logistics costs are not
Airport will be a focal point of logistics Vikash Khatri, founder of the logistics going to come down.”
in the southern region. It is estimated & supply chain advisory and execution While asked about the lack of
to cater to 7.17 million metric tonne support firm Aviral Consulting pointed participation from logistics companies,
(MMT) cargo in a horizon period of 45 out the lack of participation from Srideep Sen, an independent marketing
years,” reads the MoRTH release. logistics companies in the development consultant, pointed out the huge capital
The government of India is developing of MMLPs. He also raised the concern investment needed to build big projects
35 MMLPs across the country, out that if all the MMLPs go to two or three like MMLPs.
of which 15 MMLPs are prioritised players then the market will be tilted “As the infrastructure and investment
in the next three years, which are and competition will go for a toss. are so huge, you will not find many private
huge facilities with no comparison “These are mega projects that players coming into this market. MMLPs
to warehouses or facilities currently require huge Capex. MMLPs will have are ten times the size of normal logistics
available in the country. rail terminals, road connectivity and parks in India. Technically, the investment
The Indian government has already all warehousing facilities. For Adani goes into billions of rupees. MMLPs
shown its intention to complete the Group it makes real sense because they did not just accommodate one part of
bid processing and awarding of three can connect their existing business in logistics but every mode, which brought
MMLPs at Bangalore, Nagpur, and seaports and rail with MMLPs for the in connectivity, convenience and time
Indore by March 2023. free flow of goods. But there should management. We will only see very few
Meanwhile, in December 2022, be more players coming into the real estate or big corporates working in
The National Highways Logistics development of MMLPs. There should tandem with the government for MMLPs.”
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