Despite having a geographical advantage, Madhya Pradesh has failed to tap its potential as the country’s logistics hub although some private sector investment has started trickling in, say experts.
In 2003, the state government unveiled a blueprint for making Madhya Pradesh a warehousing and logistics hub for perishable goods moving from north to south India.
Similarly MP was envisaged as a transit point for fast moving consumer goods (FMCG) moving from the point of manufacturing for further distribution in other states.
“It was a grand idea based on the concept that 90% of the population of India could be reached from Madhya Pradesh by road transport within 24 hours, but that plan has failed to materialise so far,” says Pithampur industry association president Gautam Kothari.
While the Madhya Pradesh Warehousing Development Corporation has been providing subsidies for building warehouses and cold storages at block levels, the integrated warehousing and logistics hub is yet to come up on a big scale.
In May 2015, the state government in a joint venture with a private company opened a composite logistics hub at Pawarkhera in Hoshangabad district.
“We need more composite hub and on a far bigger scale that could be used for storage of not only perishable goods but also the FMCG products,” Kothari says.
The DMIC Development Corporation (DMICDC) has conceived a multimodal logistics hub at Pithampur as part of development of Pithampur-Dhar-Mhow investment node to improve logistics-integration of the region, says a report prepared by a DMICDC-appointed consultant.
“The new railway line between Tihi (near Pithampur) and Indore is expected to be operational soon and this further boost the connectivity of Pithampur with Mumbai and other cities where ports are located,” says an official of the Madhya Pradesh Audyogik Kendra Vikas Nigam.
The hub, however, will only be used for export purpose and at present the project has been delayed due to delay in the land acquisition.
In 2012, the state government came out with a warehousing and logistics policy that aims to develop the state as a warehousing and logistics hub of the country and to enhance warehousing capacity through private investment to promote agriculture and industry.
Though investments have started trickling in with a private company developing an integrated warehousing complex near Bhopal, the MP government’s objective of turning the state into the country’s warehousing and logistics hub remains unfulfilled.
Before the BJP came to power in the state, the then chief minister Digvijaya Singh tried to pitch Madhya Pradesh as the most preferable state in the country due to its geographical location. A Logistics meet was organized in 2001 in Indore.
Fifteen years on, Madhya Pradesh is still struggling to develop itself into a preferred logistics hub of the country.
The Madhya Pradesh Trade and Investment Facilitation Corporation Ltd that showcases the prospects of the state as a composite logistics hub, says: “…Central location of the state gives it inherent potential to become the logistics hub of the country.
“Land is available in MP in ample at lesser rates than other regions in India…There are 16 national highways passing through the state with total length of 4670 km…MP is well connected with the rest of India through railways with almost 425 trains passing through the state on a daily basis...There are 5 operational airports in MP.”
Industrialists, however, say that the government has to do a lot to change the ground reality and improve the scenario in the state.
“I have to spend approximately rs 40,000 to transport a container of goods from Mandideep or Govindpura to Mumbai, which has the nearest port, whereas I have to spend approximately $200 (Rs 13,348) to transport goods to Hong Kong or Singapore,” says an industrialist, who did not wish to be named.
“I gave up a major deal with a US company after getting through several rounds of talks when I calculated and realized that given the exorbitant transportation cost in getting the raw materials from Mumbai would hardly leave any profit to me,” he tells Hindustan Times. “There cannot be any logistics hub without a robust infrastructure in place. This is where Gujarat, Maharashtra and other states score over Madhya Pradesh.”
HOW THE STATE SHAPES UP
Monthly container movement
4,000: Pithampur (Indore)
2,500: Mandideep (Bhopal)
400: Malanpur (Gwalior)
Note: All units in TEUs (Standard size shipping container)
How can MP be the logistics hub?
MP is strategically located in the centre of the country
DMIC project includes Madhya Pradesh areas
16 national highways pass through the state
Availability of land
One international airport each in Indore and Bhopal and Mumbai port not far away
Want of robust infrastructure
Poor air connectivity
Want of hassles free environment in power corridors
No adequate skilled manpower
No coordination among different wings of govt