Industry Expectations - Interim Budget 2009
Mr. D. P. Agarwal VCMD - Group TCI
Recommendations for the interim budget from Mr. D.P.Agarwal, Vice-Chairman & Managing Director, Group TCI, India’s leading integrated supply chain and logistics solutions provider:
1) Issue: Industry status for the logistics sector
The logistics sector has developed into a major service sector as all major businesses, including the automobile, FMCG, pharmaceutical sectors increasingly become dependent upon it. This helps companies concentrate on their core activities as their logistics requirements are taken care of by third party logistics companies like TCI.
Suggestion: TCI suggests setting up a separate regulatory authority for the logistics sector as a whole along the lines of the Insurance Regulatory & Development Authority and Telecom Regulatory Authority of India.
2) Issue: Toll Policy
Multiple toll points on highways reduce efficiency and impacts on the turnaround time of trucks. Moreover, the lack of uniformity in toll charges owing to different stretches on BOT basis creates irregularities in the cost structure.
Suggestion: A centralised toll mechanism is needed to ensure uniformity in the toll charges paid by trucker drivers at various check points. This would lead to reduction in stoppage time and create greater efficiency.
3) Issue: Cold Chain Service
There is a need to bring in uniformity in the sales tax structure on processed foods. There is also the need to bring down the high import duty on cold chain equipments.
- The government, should reduce sales tax and excise on processed value-added foods, remove Octroi, entry tax etc.
- Industry should be given exemption/subsidies to encourage investment in cold chain infrastructure
- Since time-definite delivery is critical, inter-state check-posts should have a clearance passage for refrigerated transportation
- In order to boost export business by road to countries like Bangladesh, Nepal, Bhutan, Pakistan and Afghanistan we need to ensure modern warehousing, cold storage and efficient equipment handling facilities at borders with all the securities system should be set up.
4) Issue: Modernization of Rail freight sector
Railways have become an important mode of transportation.
Suggestion: The Government must expedite the development of the rail-freight corridor to give a much-needed fillip to the rail freight sector. Modernization of rail terminals and handling facilities should be commissioned for a quicker turn-around of the non-container rakes. There must be time-scheduled freight trains on all major routes, on a daily basis.