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Public Sector and Governance

India: A logistics powerhouse in the making?

Karla Gonzalez Carvajal's picture
Photo: Daniel Incandela/Flickr
The numbers are in: India now ranks 44th in the latest edition of the World Bank’s Logistics Performance Index, a relatively high score compared to other countries at similar income levels. This number matters not just to the logistics sector, but to India’s economy as a whole. Indeed, logistics can directly impact the competitiveness of an entire market, as its ability to serve demand is inextricably linked to the efficiency, reliability and predictability of supply chains.

Broadly defined, logistics covers all aspects of trade, transport and commerce, starting from the completion of the manufacturing process all the way to delivery for consumption. To say that it is a complex business is an understatement.

First, there is always a delicate balance between the public arm, which provides the roads, railways and waterways, and lays down the rules and regulations, and the private sector, which has responsibility for carrying out logistics operations in a smooth and seamless manner. This fine interplay is further complicated by the globalization of manufacturing which—with many more ports of call in the logistic chain—is putting ever-increasing pressure on the sector. In addition, there are very practical challenges in integrating different modes of transport, in speeding up border crossings, and in dealing with trade protections–all of which impact external trade.

But as difficult as it might be, creating a well-functioning logistics sector is essential to any nation looking to compete in the global economy. India is a case in point. To fuel its global ambitions, the country has taken active steps to up its logistics game.

Three ways governments can create the conditions for successful PPPs

Lincoln Flor's picture
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A healthy Public-Private Partnership (PPP) has several defining features: strong competition, bankability with low financial costs, lower risk of renegotiations, secure value for money, and efficiency gains.

What does it take for countries to develop PPPs that can fit this description? Why is it that some countries such as India, Colombia, Turkey, and Egypt have been able to develop strong and successful PPP programs while others have not been able to award any projects under special-purpose PPP legislations? 

Our experience with infrastructure PPPs across the globe suggests that three institutional pillars are needed to increase the probability of PPP success.

Engaging citizens in local development: The story of the Tocantins Road Project in Brazil

Satoshi Ogita's picture
Also available in: Português
 

Miranorte is a small town in the State of Tocantins, northern Brazil, well-known for its pineapple production. During the rainy season, the production cannot reach the markets due to the obstruction of the roads with the water flow. In many places, the roads lack bridges and culverts, jeopardizing both safety and accessibility.

In order to address these challenges, the World Bank’s Multisector Project in Tocantins (2012-2019), which  includes a rural road component, decided to hear firsthand from the community about their priorities for development and inputs in the selection of roads that needed improvement. Aside from a practical and transparent approach, the consultations compensated for the lack of information required for conventional planning.

Tocantins, as many places in the world, doesn’t have any traffic data, information on road conditions, or even maps of the rural road network available. Although IT technologies are emerging and the importance of these data for management of road assets is evident, it is often time-consuming and costly to survey all the rural road network, especially in a state like Tocantins, which is larger than the United Kingdom.

How can Indonesia achieve a more sustainable transport system?

Tomás Herrero Diez's picture
Photo: UN Women/Flickr
Indonesia, a vast archipelago of more than 17,500 islands, is the fourth most populous country in the world, with 261 million inhabitants, and the largest economy in Southeast Asia, with a nominal Gross Domestic Product of $933 billion.

Central government spending on transport increased by threefold between 2010-2016. This has enabled the country to extend its transport network capacity and improve access to some of the most remote areas across the archipelago.

The country has a road network of about 538,000 km, of which about 47,000 km are national roads, and 1,000 km are expressways. Heavy congestion and low traffic speeds translate into excessively long journey times. In fact, traveling a mere 100 km can take 2.5 to 4 hours. The country relies heavily on waterborne transport and has about 1,500 ports, with most facilities approaching their capacity limits, especially in Eastern Indonesia. Connectivity between ports and land infrastructure is limited or non-existent. The rail network is limited (6,500 km across the islands of Java and Sumatra) and poorly maintained. The country’s 39 international and 191 domestic airports mainly provide passenger services, and many are also reaching their capacity limits.

Maximizing finance for safe and resilient roads

Daniel Pulido's picture


Around the world, roads remain the dominant mode of transport and are among the most heavily-used types of infrastructure, accounting for about 80% of the distance travelled for individuals and 50% for goods.

Despite this intensive use, the funding available for road maintenance has been inadequate, leaving roads in many countries unsafe and unfit for purpose.

To make matters worse, roads are also very vulnerable to climate and disaster risk: when El Niño hit Peru in 2017, the related flooding damaged about 18% of the Peruvian road network in just one month.

It is no surprise then that roads are the sector that will require the most financing. In fact, the G20 estimates that roads account for more than half of the $15 trillion investment gap in infrastructure through 2040.

Sustainable mobility and citizen engagement: Korea shows the way

Julie Babinard's picture
Suwon's EcoMobility Festival. Photo: Carlos Felipe Pardo
The discussion on climate change often tends to ignore one critical factor: people’s own habits and preferences. In urban transport, the issue of behavior change is particularly important, as the transition to low-carbon mobility relies in large part on commuters’ willingness to leave their cars at home and turn to greener modes such as public transit, cycling, or walking.
 
Getting people to make the switch is easier said than done: decades of car-centric development, combined with the persistence of the private car as a status symbol, have made it hard for policymakers to take residents out of their vehicles.
 
Against this backdrop, I was inspired to learn about the example of Suwon, Gyeonggi Province, a city of 1.2 million some 45km south of Seoul I visited on my last trip to the Republic of Korea.
 
Officials in Suwon have realized that, although awareness of climate change is becoming widespread, behavioral engagement hasn’t quite caught up. To overcome this challenge, the city decided to make sure residents could be directly involved in the design and implementation of its urban transport strategy.

Railways are the future—so how can countries finance them?

Martha Lawrence's picture
Photo: Kavya Bhat/Flickr
As a railway expert working for the World Bank, I engage with many client countries that are looking to expand or upgrade their railway systems. Whenever someone pitches a railway investment, my first question is always, “What are your trains going to carry?” I ask this question because it is fundamental to railway financing. 

Railways are very capital intensive and increasingly need to attract financing from the private sector to be successful. That is why the World Bank recently updated its Railway Toolkit to include more information and case studies on railway financing. Here, in a nutshell are the key lessons about railway financing from this update. 

Maximizing finance for sustainable urban mobility

Daniel Pulido's picture
Photo: ITDP Africa/Flickr

The World Bank Group (WBG) is currently implementing a new approach to development finance that will help better support our poverty reduction and shared prosperity goals. This crucial effort, dubbed Maximizing Finance for Development (MFD), seeks to leverage the private sector and optimize the use of scarce public resources to finance development projects in a way that is fiscally, environmentally, and socially sustainable.
 
There are several reasons why cities and transport planners should pay close attention to the MFD approach. First, while the need for sustainable urban mobility is greater than ever before, the available financing is nowhere near sufficient—and the financing gap only grows wider when you consider the need for climate change adaptation and mitigation. At the same time, worldwide investment commitments in transport projects with private participation have fallen in the last three years and currently stand near a 10-year low. When private investment does go to transport, it tends to be largely concentrated in higher income countries and specific subsectors like ports, airports, and roads. Finally, there is a lot of private money earning low yields and waiting to be invested in good projects. The aspiration is to try to get some of that money invested in sustainable urban mobility.

How can we enhance competition in bus passenger urban transport?

Shomik Mehndiratta's picture
Photo: EMBARQ Brasil/Flickr

Também disponível em português.

While bus services are often planned and coordinated by public authorities, many cities delegate day-to-day operations to private companies under a concession contract. Local government agencies usually set fares and routes; private operators, on the other hand, are responsible for hiring drivers, running services, maintaining the bus fleet, etc. Within this general framework, the specific terms and scope of the contract vary widely depending on the local context.

Bus concessions are multimillion-dollar contracts that directly affect the lives of countless passengers every day. When done right, they can foster vigorous competition between bidders, improve services, lower costs, and generate a consistent cash flow. However, too often the concessions do not deliver on their promise and there is a perception across much of Latin America that authorities have been unable to manage these processes to maximize public benefits.

As several Latin American cities are getting ready to renew their bus concessions—including major urban centers like Bogotá, Santiago de Chile, and São Paulo—now is a good time to look back on what has worked, what has not, and think about ways to improve these arrangements going forward.

Transforming Transportation 2018: To Craft a Digital Future for All, We Need Transport for All

Jose Luis Irigoyen's picture



Exponential progress in how we collect, process and use data is fundamentally changing our societies and economies. But the new digital economy depends fundamentally on a very physical enabler. Amazon and Alibaba would not exist without efficient ways to deliver products worldwide, be it by road or ship or drone. The job you applied for through Skype may require travel to London or Dubai, where you’ll expect to get around easily.

In fact, as the backbone of globalization, digitization is increasing the need to move people and goods around the planet. Mounting pressure on transportation as economies grow is leading to unsustainable environmental and safety trends. Transport needs are increasingly being met at the cost of future generations.

Can the digital revolution, which depends so much on efficient global and local mobility, also help us rethink transportation itself? To be a part of the solution to issues such as climate change, poverty, health, public safety, and the empowerment of women, the answer must be yes. Transport must go beyond being an enabler of the digital economy to itself harnessing the power of technology.

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