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Business

India to expand cargo-location service using wireless tech

Hopes to repeat success of Delhi-Mumbai corridor in other industrial areas

A palm-size RFID tag, shown on left, is poised to change logistics operations in India.

NEW DELHI -- India is planning a nationwide expansion of a logistics visualization service using radio-frequency identification tags, in line with the government's efforts to make the country more business-friendly.

The program, which has been used for cargo transportation in the northwest part of the country, will broaden to the south, Alkesh Sharma, CEO of Delhi Mumbai Industrial Corridor Development Corp., or DMICDC, said in a recent interview with The Nikkei. This will mark the first time the developer's successful project is introduced to other regions.

Lessons learned from the region connecting India's capital and its commercial hub will be put to use as the service makes its way to other industrial corridors such as the Chennai-Bangalore route, Sharma noted. The Indian government owns 49% of DMICDC, while the Japan Bank for International Cooperation holds a 26% stake.

The logistics visualization service, run by a 50-50 joint venture of DMICDC and Japanese information technology company NEC, automatically logs the times that cargo passes ports and inland customs checkpoints by reading RFID tags attached to shipping containers. The system not only enables real-time tracking of cargo location, but also spurs ports and customs checkpoints to bolster efficiency in order to stay competitive. The average duration of port processing shrank by 10% under the system and that for customs screening by 25%, according to the developer, which expects comparable or greater effects in other regions as well.

Ports in Mumbai, the state of Gujarat and elsewhere adopted the service between July 2016 and this past May. DMICDC plans to bring it to five more ports, including Chennai and Kattupalli, between January and April of next year. Sharma indicated that the service will not be limited to container shipments, which are mainly handled by trucks, with potential applications including bulk cargo shipping and waterway transportation on the Ganges River.

The government led by Prime Minister Narendra Modi has been working to make India more accommodating to business, in order to attract more direct investment from abroad. Although India is targeting a top-50 listing in the World Bank's ease of business index, its most recent ranking was 130th -- trailing such countries as No. 46 Thailand and No. 91 Indonesia. The sub index on cross-border trade, which covers customs handling and costs, ranks especially low, at 143th, dragging down India's overall position. By applying elements of competition to public facilities like ports and customs sites, the South Asian nation seeks to boost efficiency and raise its standing.

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