National Freight Index: by Rivigo Logistics
Rivigo, a Gurgaon-based tech-enabled logistics start-up has launched National Freight Index (NFI) that will provide live freight rates for different lanes and vehicles across the country. Rivigo is a technology enabled logistics company, that owns a fleet of over 3,000 trucks, which works on ‘Relay Model’.
About National Freight Index
NFI is barometer of road freight market in India and is based on Rivigo rate exchange. It will provide live spot rates on more than 7 million lane and vehicle type combinations in India. This will be a step towards easing logistics sector crisis and also streamlining sector.
NFI offers a combined picture of both live rates and historical trends of spot price movements in India’s road freight industry.
Index is represented in two main forms-
- In terms of actual freight rates condensed to Rupees per tonne-km
- In terms of relative movement with respect to a base month.
Rates on both index and exchange are based on Rivigo’s economics powered pricing algorithms and machine learning, which uses factors such as millions of data points from historical transactions, current market dynamics, micro market insights etc. for computing thus are continuously improving on accuracy.
This is done with ultimate purpose of giving a fair and precise representation of the state of the spot market in India.
Need: There are high rate of inefficiencies in existing freight market, which in turn leads to a great loss of value. Thus using NFI will ensure unrestricted access by giving a fair and precise representation of state of country’s spot market and will bring transparency in road-freight marketplace.
It will also bring a pricing transparency, in a system where demand traditionally flows from transporters, brokers, fleet owners and then to drivers.
NFI will give historical spot price movements of country’s road freight industry. In India actual freight rates are in Rupee per ton-km and in terms of relative movement with respect to a base month, and this would be updated by NFI in real time.
Efficiency of spot freight marketplace will determine how the growth is compounded and National Freight Index will empower all stakeholders to realise its full potential. The NFI can be visited at nationalfreightindex.com.
India’s Logistic Sector
Even though logistics sector account for about 14% of India’s GDP and 70% of its contribution comes from road transportation but still there is no pricing transparency and working conditions of drivers is deplorable in the sector.
Due to such conditions willingness to join sector is decreasing and due to this India could face a 50% shortage of truck drivers by 2023.
Challenges: The Indian road freight market size is estimated to be worth $150-$160 billion out of this $130-$140 billion is full-truck load (FTL) market, but India’s freight market has been facing a growing challenge of shortage of truck drivers.
Month: Current Affairs - June, 2019
Category: Economy & Banking Current Affairs