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The Comptroller and Auditor General (CAG) has established an Integrated Audit Group to conduct a coordinated audit of India's key infrastructure sectors-railways, ports, shipping, and waterways-in collaboration with IIM Mumbai. The audit evaluates how effectively multi-modal transport and logistics systems support national economic goals, focusing on connectivity, infrastructure alignment, and performance under the National Rail Plan 2030. It will also review India's logistics costs, which currently stand at 7.97% of GDP, and identify areas for optimisation. Additionally, the CAG will assess the Indian Railways e-procurement system for governance and IT gaps. The findings are expected to inform future policy and strengthen India's logistics efficiency and competitiveness.
The CAG has formed an Integrated Audit Group to carry out a coordinated audit across major infrastructure sectors such as railways, ports, shipping, and waterways. In partnership with IIM Mumbai, the audit focuses on assessing the performance of multi-modal transport and logistics initiatives to determine how effectively India?s logistics ecosystem integrates various transport modes and supports national economic objectives. Advertisement
The audit's scope covers first-mile and last-mile logistics connectivity, origin-destination (O-D) movement, and the alignment of infrastructure and operational frameworks. A major area of attention is the National Rail Plan 2030, which targets an increase in the railways' freight modal share to 45 % and aims to boost average freight-train speeds to 50 km/h, thus creating capacity in line with projected demand up to 2050.
Findings from a recent NCAER study revealed that logistics costs accounted for 7.97 % of India's GDP in FY 2023-24, with the SME sector bearing a significantly higher burden of 16.9 %. The audit seeks to highlight areas where these costs can be optimised through improved governance, streamlined regulation, and technology adoption.
In addition, the report will assess India's regulatory and legal environment, digitalisation initiatives, and ease of doing business in logistics, comparing them with global benchmarks. The CAG has held consultations with key stakeholders, including the Railway Board, logistics-related public sector undertakings, and heads of port and transport authorities, to obtain practical insights.
The audit also includes a review of the Indian Railways e-procurement system (IREPS) to identify governance, IT control, and compliance gaps. It is expected to point out vulnerabilities in system security, process adherence, and tendering practices, offering corrective recommendations for greater transparency and efficiency.
The forthcoming CAG report represents a critical evaluation of India's logistics and transport landscape. By focusing on infrastructure integration, digitalisation, and regulatory efficiency, it aims to uncover systemic weaknesses affecting cost competitiveness and operational reliability. The insights from this audit are likely to guide future policy actions and investment strategies, enhancing the effectiveness of India's transport and logistics framework to support sustainable economic growth.
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