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about freight smart cities

Need for Freight Smart Cities

Freight vehicles contribute disproportionately to city air and noise pollution. Ten percent of India’s freight-related CO2 emissions are due to urban freight. Freight vehicles were responsible for 10% of road fatalities in Million-Plus cities in 2019. They also cause traffic congestion issues and delays in cities due to improper parking and driving. Overall, the public health issues posed by urban freight are considerable. This is exacerbated when a city’s urban freight system is inefficient due to uncoordinated deliveries that generate excessive trips and vehicle kilometres.

India’s economic growth is closely tied to the prosperity of its cities, which collectively contribute over 63% to national GDP. Urban freight ensures that residents and businesses in all sectors receive the products needed to carry out daily tasks, and thus has become critical for the modern Indian city. Total demand for urban freight is estimated to increase by 140% in this decade.

Moreover, India is witnessing a rapid rise in e-commerce demand, which is further increasing the overall urban freight demand. The e-commerce market particularly is expected to grow to a market size of INR 11 lakh crore by 2022.

Despite being a core component of the urban economy, freight is also associated with multiple negative externalities.

10-18% of total vehicle kilometres in a city is from freight vehicles.

19mt CO2 emissions in 2020-21 were emissions from urban freight

50% of total logistics cost is accounted by the first/last mile delivery

21% of road fatalities in 2019 were due to heavy duty vehicles


Efficiency improvements in freight movement can have far-reaching effects on the economic competitiveness of a city, while providing opportunity to lower emissions, improve public health, road safety and traffic flow, and create jobs within the city. To realize these benefits, it’s important to encourage cities across India to start thinking about efficient urban freight movement, planning infrastructure assessment, and implementing the right set of measures for efficiency improvement. Implementing efficiency measures will require effective planning by cities, alongside effective collaboration between private and public sector stakeholders

Reduction in Costs of last mile delivery

Creation of Jobs

Reduction in GHG Emissions

Improvement in local air quality

Improvement in traffic flow and road safety


The Government of India (GoI) aims to support cities in achieving freight smart status.

Goals and Targets
Encourage cities to set targets and prioritise urban freight efficiency improvements in their policy and regulatory framework

Build adequate, efficient, sustainable, and green logistics infrastructure

Institutional Structures
Leverage cross-collaboration among public and private sector players for faster and effective adoption of efficiency measures

City Logistics Plans
Cities formulate and implement City Logistics Plans (CLPs), which will help cities map their current freight performance, define their present and future needs and identify reform areas

Use latest technologies, digital and cost-effective measures for urban freight standards and certification systems

Through the Freight Smart Cities initiative, India’s urban freight ecosystem can become cleaner and more efficient while contributing to city vitality and competitiveness. At a national scale, the initiative has the potential to improve India’s rank in the Logistics Performance Index (LPI) while promoting strong economic development across its urban areas.


STEP 1 : Identification of Cities

A State governments will be requested to identify cities for being developed as Freight Smart cities. It is suggested that these could be capital cities, cities covered under Smart Cities Programme of MoHUA, other priority cities of the State Governments or cities that have more than one million population.

STEP 2 : Establishing partnerships with academic institutions and CSOs

One of the pillars of the Freight Smart Cities initiative is formalizing the partnership of cities with academic institutions and civil society organizations (CSOs) such as think-tanks. Such institutions possess expertise and knowledge that can aid city governments in formulating and implementing a successful CLP. Based on ongoing projects, research, and geographical interest of institutions, they will be partnered directly with 1 or more cities. The institutions will be engaged in providing capacity building and technical support directly to partner cities.

STEP 3 : Formation of State and City level logistics committees

The urban freight ecosystem is complex and comprising various stakeholders with differing roles and priorities. In addition to e-commerce companies, carriers, logistics providers, and other private sector players, urban policymakers must work with state authorities, law enforcement agencies, vehicle regulators, and other public sector agencies to formulate effective policies.

Due to this multi-stakeholder nature of urban freight, efficiency improvements need to be identified and implemented in a collaborative fashion. State and City level logistics committees can effectively play this part by bringing together stakeholders from public and private sector.

These committees will provide support to the freight smart cities through advisory and planning, stakeholder coordination and progress assessment. Moreover, these committees can provide guidance, create an enabling environment for the formulation, implementation and monitoring progress of City Logistics Plans (CLP’s)

More details on the committee composition and functions can be read here.

STEP 4 : Identification of barriers and solutions

Following their formation, the logistics committees will help fast track data collection on freight movement in the city. Different categories of data can be collected by city officials under the guidance of the committee, such as vehicle location and travel data, business registrations, surveys, and manual traffic counts. Where already available, data can be collated with newer sources to develop an understanding of the city’s freight system. City officials can next forecast freight demand, ensuring that plans account for future needs of residents and businesses.

After data acquisition, forecasting, and conducting stakeholder consultations, the logistics committees can identify the specific barriers in a city and thus possible solutions. While some solutions for freight efficiency can be implemented within a year with limited additional resources in terms of capital, capacity, and infrastructure, other measures require more time and resources to plan and implement. Logistics committees can assess the same and help prioritize actions based on the resources available to a city.

Some of the possible high-impact measures that cities can implement can be read here.

STEP 5 : Formulation and Implementation of City Logistics Plans (CLPs)

All freight smart cities can utilize the above-mentioned strategies to develop the City Logistics Plans (CLPs). The main objective of the CLPs will be to improve the existing freight transport ecosystem and infrastructure in the cities, promote economic development, and improve the quality of life for the citizens. These plans will consider both short-term fixes and the long-term planning to resolve the existing barriers hindering efficient freight movement and implement the right set of measures. The plan will also focus on minimising the environmental impact of the freight transport activities and will promote automation and digitisation in freight movement and warehousing for increased efficiency.

The plans will be formulated via a step-by-step approach. As part of the plan, the city will work with respective state and city logistics committee to conduct data collection to understand key issues and barriers, forecast freight demand, set targets for improved freight efficiency, and outline specific solutions to achieve those targets.

Once the plans are put in place, cities will work their respective logistics committees and other relevant stakeholders to start implementing the plans. The plans will be updated on regular intervals post reviews by the city planners and committee members.

Guideline for National Sustainable Urban Freight Transport System can be accessed here

STEP 6 : Monitoring, Reporting and Verification

A monitoring, reporting and verification (MRV) framework will be set up to measure city’s freight performance. The goal of this framework will be to understand current performance of city with respect to urban freight and which areas it needs to improve upon.

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