New Delhi, Sept. 4 -- The GST Council's decision to reduce the levy on goods carriers from 28% to 18% is likely to reduce the country's logistics costs, a key factor in improving the country's total economic output and reducing prices.

A reduction in the cost of logistics would have cascading effects, such as making the manufacturing sector more competitive, something that's especially important amid global economic uncertainty and a 50% tariff from the US.

Union minister of road transport and highways Nitin Gadkari has said several times that while India's logistics costs have fallen over the years, they need to be lower still. His goal is to reduce India's logistics costs to 9% of gross domestic product (GDP), he told Mint in July. At...