Discuss the role of Indian Railways in achieving India's logistics cost-reduction targets under the National Logistics Policy.

The National Logistics Policy (2022) seeks to cut India's logistics cost — estimated at 13–14% of GDP — to levels comparable with global benchmarks by 2030 [1][7]. As the cheapest and least carbon-intensive bulk surface mode, Indian Railways is the structural lever for this target, though its contribution remains constrained by capacity and pricing distortions.

Enabling modal shift to cheaper transport

• The National Rail Plan targets raising rail's freight modal share from about 27% to 45% by 2030, directly attacking road-dominated, high-cost freight movement [2].
• Dedicated Freight Corridors have enabled higher-speed, higher-axle-load haulage and "trucks-on-trains" roll-on services, compressing transit time and inventory cost [3].

Demonstrated freight performance

• Railways crossed 1 billion tonnes of loading in FY 2025-26 [4]; monthly momentum continued with 137.9 MT in August 2026 (+5.4% YoY) and 9% growth in July 2026 [5][6].
• Freight revenue growth (6.27%) outpacing tonnage growth signals a better commodity mix — domestic containers (+9.2%) and iron ore (+12.1%) — i.e. a shift beyond traditional bulk into higher-value logistics [5].

Last-mile and digital integration

• 149 Gati Shakti Cargo Terminals (as of 31 August 2026) address the first-and-last-mile gap that historically pushed shippers to road [5].
• Integration with PM Gati Shakti and the Unified Logistics Interface Platform aligns rail capacity with multimodal planning and paperless documentation [7].

Persisting constraints

• Growth is uneven (May 2026: +1.3%; July: +9%), showing dependence on a narrow bulk commodity basket [5][6].
• Cross-subsidisation of passenger operations from freight tariffs keeps rail freight rates uncompetitive on some routes, while suburban demand (+9.02%) adds to the passenger burden [5].

Railways is therefore a necessary but not sufficient condition for logistics cost reduction: tonnage is rising, yet modal share must nearly double. Sustained DFC commissioning, rational freight tariffs and deeper terminal-level multimodal integration can convert this momentum into a genuine cost advantage — advancing both the NLP's competitiveness goal and India's SDG-9 commitment to resilient, sustainable infrastructure.