Before the imposition of the strict lockdowns and the spread of COVID-19, the disruptions in China caused a ripple effect on the global supply chains. Emphasis has been laid on minimisation of costs and timely delivery of essential products.
In India, as the situation worsens due to the outbreak, we have seen disruptions in the logistics supply chain. There are several reasons attributed to the increase in demand and slowing of the supply. There are several workable solutions available to look into this situation. We should work towards promoting Indian markets and amend policies to help the local workforce lessen the inter-dependencies of imports on other countries. This will help in strengthening the logistics supply chain in India. This will create employment opportunities and increase the GDP growth.
Logistics is the backbone of an economy, as it ensures free flow of goods and services required for the functioning of industries and the economy. India’s logistics sector is rapidly evolving despite facing enormous challenges (PYMNTS, 2020). Inadequate logistics infrastructure has created several bottlenecks in the growth of the economy. The biggest challenge faced by the Indian industry today is the lack of integration of transport, distribution of warehouses, different regulations imposed at the national, state and district levels and trained and efficient workforce’s. This makes the sector unorganized. Today, we are facing an unprecedented crisis which has made us look into the vulnerabilities of our logistics supply chain.
The Chinese economy is the manufacturing powerhouse and is also known as the world’s factory. One can see its products everywhere, with the label ‘Made in China’. Therefore, China being the epicenter of COVID-19, it went under a lock down and extensive measures were put into action quite early, causing supply from the manufacturing facilities being reduced, affecting the exports from China and imports to the other countries. Before this pandemic, China used to produce half the world’s masks. However, as the infection rate in China increased, the systems of manufacturing came to a halt. Now that the infection rate has slowed in China, it has started exporting products to all over the world. The problem that remains is of the substandard products being shipped to countries worldwide.
As the COVID-19 pandemic continues to spread, it has exposed vulnerabilities of supply chains and logistics. It has disrupted health supply chains, affecting active pharmaceutical ingredients, shipping, procurement’s, finished healthcare products and more.
Logistics supply chain means much more than the movement of pharmaceuticals and other products between countries. It definitely deals with problems at the grassroots level, including the migration of labourers working in industrial units, ban on transportation activities, especially trucks, lack of cooperation between different administrations and transporters and couriers not functioning timely. All these factors cause delays and hamper the supply chain, causing issues in supplies of vaccines, hand sanitizers, testing kits, protective healthcare equipment (PPE), medicines, medical equipment, raw material and much more.
While things are still better in metro cities, the situation remains grim in the districts. Trucks carrying coal are not allowed to pass through borders, and the suspension of flight services has led to goods being stuck in different corners of the country. This has primarily affected chemists and eco-retailers in distributing products to the community.
Moreover, the World Health Organization reported that serious and escalating damage to the global supply of PPE, N95, sanitisers and testing kits is triggered by rising competition, panic purchasing, hoarding and abuse, which is placing lives at risk from the latest coronavirus and other infectious diseases. An approximate 89 million medical masks are required per month for combating COVID-19, based on WHO modelling. The number goes up to 76 million for examination gloves, while overseas demand for goggles is 1.6 million a month.
Many companies across the globe are working to make their supply chain leaner. Their emphasis on minimisation of costs and timely deliveries has left no room for adequate buffers and has led to a reduction in the inventory buffers. These situations have worsened the impact on the supply chains, exposing the fragility of logistics management.