Unable to understand basis for assumption on logistic cost: EAC-PM official

Economic Advisory Council to the Prime Minister (EAC-PM) member Rakesh Mohan on Tuesday said he is unable to find the basis for assuming that logistics cost account for 14 per cent of India's GDP and the assumption forms the basis for government initiatives like production-linked incentive (PLI) schemes.

Addressing an event organised by economic think tank ICRIER, Mohan further said he failed to find out how 14 per cent logistic cost number was arrived at by think tanks or researchers.

"It seems to be generally accepted that India's logistics costs are significantly higher than global benchmarks. I have tried to look into this, but I can never find what is the basis of this data... this report (CRIER report) repeats the often used number of India's logistics costs being 14 per cent of GDP," former deputy governor of RBI said.

The government is going by certain estimates which suggest that logistics cost in India stands at about 13-14 per cent of the country's GDP. The government has