Government initiatives and growth of Indian Logistics Industry
India’s logistics industry is currently undergoing a transformative phase. The government is also working on ways to attract greater investments in this segment. Grant of infrastructure status to logistics is a step in the right direction.
The economic survey 2017-18 presented in the parliament has contemplated that Indian logistics Industry to grow at a CAGR of 10.5% crossing the 200 billion USD mark in coming time. With presently 22 million people employed in the industry, logistics is expected to expand employment to over 40 million people by 2020. With such a bright future, the Indian logistics sector has become the new sensation encouraging Government to frame a dedicated IT backbone for this industry. Even the import-export systems have been upgraded reducing the cargo release time to only 2 or 3 days.
The expanding manufacturing base under the central government’s Make in India initiative, the entry of global players in the logistics industry, along with the introduction of the Goods and Services Tax (GST), and emerging avenues such as e-commerce and logistics parks infrastructure are changing the course and dynamics of the industry. The Central Board of Indirect Taxes and Customs (CBIC) under the Ministry of Finance also has brought new provision under CSB IV and CSB V to the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 providing people 100% GST refunds in the logistics services. Customers can easily move their shipments with minimal paperwork and faster delivery and customs clearances with the new policy changed by the government.
Moreover, government has included this sector in the Harmonised Master List of Infrastructure Subsector. Inclusion of logistics sector in the Harmonised Master List of Infrastructure Subsector will benefit the sector in many ways. It will facilitate the credit flow into the sector with longer tenures and reasonable interest rates. Adding the infrastructure status to this sector will simplify the process of approval for construction of multi modal logistics facilities that includes both storage and transport infrastructure. It will also encourage market accountability through regulatory authority and will attract investments from debt and pension funds into recognised projects. (https://www.financialexpress.com/budget/economic-survey-2018-indias-logistics-sector-to-reach-215-billion-by-2020/1034711/)
Apart from this, to promote the growth of logistics sectors many start-ups and established enterprises have entered the market with the latest technology, quality warehousing, and functional transport facility to provide world-class services in the Indian market. The recent entry of international logistics players has also ensured the boost of the Indian logistics industry. This will be a sight to behold the glorious rising of logistics industry in coming years, especially marking 2020.