Prime Minister Narendra Modi-led government has signed a USD 350 million policy-based loan with the Asian Development Bank (ADB) under the second subprogram of Strengthening Multimodal and Integrated Logistics Ecosystem (SMILE) program.
The loan agreement was signed between the Department of Economic Affairs (DEA), Ministry of Finance; Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry; and the ADB.
What is SMILE program
The SMILE program is a programmatic policy-based loan (PBL) to support the government in undertaking wide-ranging reforms in the logistics sector in India. The programmatic approach comprises two subprograms, which aim to expand India’s manufacturing sector and improve the resilience of its supply chain.
The program establishes and operationalises a comprehensive policy framework to enhance logistics efficiency through
(i) Strengthening the institutional bases for multimodal logistics infrastructure development at the national, state, and city levels.
(ii) Standardising warehousing and other logistics assets to strengthen supply chains and incentivise greater private sector investment.
(iii) Improving efficiencies in external trade logistics.
(iv) Adopting smart systems for efficient and low emission logistics.
Critical role of logistics
The development of India’s logistics sector is vital to enhancing the competitiveness of its manufacturing sector. Through strategic policy reforms, infrastructure development, and digital integration, ongoing reforms are poised to transform the logistics landscape.
This transformation is expected to reduce costs, improve efficiency, generate substantial employment opportunities, and promote gender inclusion—driving sustainable economic growth.
“The collaboration between the government and ADB reflects a shared commitment to fostering growth and innovation in the logistics sector, supporting India’s broader economic development goals,” the Ministry of Commerce and Industry said.
