Logistics sector in India gets infrastructure status
The new status is expected to enable the logistics sector to avail of lending at easier terms with enhanced limits and also access to larger amounts of funds
The government has accorded the logistics sector Infrastructure status with a view to accelerating development, thereby giving a boost to both domestic and external demand.
The need for integrated logistics sector development has been felt for quite some time in view of the fact that the logistics cost in India is very high compared to developed countries. High logistics cost reduces the competitiveness of Indian goods both in domestic as well as export market
The inclusion of the logistics sector in the Harmonised Master List of Infrastructure Sub-sectors was considered in the 14th Institutional Mechanism Meeting held on November 10, 2017. It was recommended by the Institutional Mechanism and subsequently approved by the Union Finance Minister, Arun Jaitley.
Logistics Infrastructure is included by insertion of a new item in the renamed category of ‘Transport and Logistics’, with a footnote stating that Logistics Infrastructure means and includes Multi-modal Logistics Park comprising Inland Container Depots (ICDs) with minimum investment of Rs 50 crore, 10 acres, cold chain Facility with minimum investment of Rs 15 crore and minimum area of 20,000 square feet, and/or warehousing facility with investment of minimum Rs 25 crore and minimum area of 100,000 square feet.
The new status is expected to enable the logistics sector to avail infrastructure lending at easier terms with enhanced limits, access to larger amounts of funds as External Commercial Borrowings (ECB), access to longer tenor funds from insurance companies and pension funds and be eligible to borrow from India Infrastructure Financing Company Limited (IIFCL).
Photographs courtesy TVS Logistics
RELATED ARTICLES
JSW MG Motor India confident of selling 1,000 M9 electric MPVs in first year
The 5.2-metre-long, seven-seater luxury electric MPV, which will be locally assembled at the Halol plant in Gujarat, wil...
Modern Automotives targets 25% CAGR in forged components by FY2031, diversifies into e-3Ws
The Tier-1 component supplier of forged components such as connecting rods, crankshafts, tie-rods, and fork bridges to l...
VinFast’s second plant in Vietnam goes on stream ahead of India factory
Vietnamese EV maker’s second plant in its home market, which has a 200,000 EVs-per-annum capacity, will focus on produci...