THE LOGISTICS SECTOR NEEDS A BLUEPRINT FOR SUSTAINED GROWTH ACCORDING TO THE UNION BUDGET: INDUSTRY

In addition to laying out a plan for the logistics sector's sustainable growth, the 2019 Union Budget should also provide incentives for the sector to embrace sustainable practises, operators said on Thursday. On February 1, the Lok Sabha will hear the Union Budget 2023–24 from Finance Minister Nirmala Sitharaman.

In a statement, Kami Viswanathan, senior vice president of operations for FedEx Express Middle East, Indian Subcontinent, and Africa (MEISA), said, "We urge the establishment of zero rating of Goods and Services Tax for all international transportation services. 

"Most international GST/VAT laws "zero-rate" services for transporting overseas freight. This would lower the cost of logistics while also facilitating trade and bringing India into compliance with international tax standards."

According to Yogesh Patel, chief financial officer of Mahindra Logistics, the government may also take into account enacting concessions for the installation of EV infrastructure, such as charging stations, in addition to concessions for new EVs. This could hasten the adoption of EVs for commercial use and help accelerate their presence in last-mile delivery services.

According to Patel, the Union Budget should continue to give priority to enhancing the logistics infrastructure in ports, warehouses, and roadways.

The National Logistics Policy's introduction clearly outlined the direction to take in order to increase the effectiveness and transparency of operations. The National Logistics Policy identifies a number of interventions that need to be made throughout the logistics ecosystem. These interventions need to be sufficiently financed by the budget so that their impacts can be felt in the years to come.

"Improving openness and visibility can be one of the budget's emphasis areas, and this can be done through the Unified Logistics Interface Platform as and when it is integrated into the system," he said.

Budget 2023: Increased government spending on logistics infrastructure and special freight lanes

In comparison to the Rs 15,710.44 crore allotted for FY23, Finance Minister Nirmala Sitharaman has granted Rs 27,482 crore to the Dedicated Freight Corridor Corporation of India (DFCC) for the financial year 2023–24 (FY24).

According to Budget documents, the central government will contribute Rs 12,241 crore of the overall budgetary support while the DFCC will fund the remaining Rs 15,241 crore through internal accruals.

The government has so far in 2022–23 given the DFCC financial support totaling Rs 14,897 crore, exceeding the allocation of Rs 12,134.73 crore established in the 2022–23 budget against the central government.