New Delhi [India], Nov 24 (ANI): With the logistics sector being granted infrastructure status recently, the Confederation of Indian Industries (CII) opined that this would speed up growth and create more employment opportunities.
"The logistics sector in India is still very fragmented and has suffered from lack of investments and a proper recognition. Now with this recognition as Infrastructure status to the logistics sector, it will not only help bring in more investments in to this sector but most importantly bring down the overall logistics cost by one to two percent. We expect the sector, which already provides over 17 million jobs, to grow at even faster rate going forward and provide even higher employment opportunities than before," said R. Dinesh, Chairman, CII Institute of Logistics and Chairman for Sector Skill Council.
The logistics sector on Monday was granted "Infrastructure" status, after it was deliberated upon in the 14th Institutional Mechanism (IM) Meeting held on November 10, recommended by the Institutional Mechanism and subsequently approved by Union Finance Minister Arun Jaitley.
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.
Development of logistics would give a boost to both domestic and external demand thereby encouraging manufacturing and 'job creation'. This will in turn be instrumental in improving country's GDP.
"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 Depot (ICD) with minimum investment of Rs. 50 crore and minimum area of 10 acre, Cold Chain Facility with minimum investment of Rs. 15 crore and minimum area of 20,000 sq ft, and/or Warehousing Facility with investment of minimum Rs. 25 crore and minimum area of one lakh sq ft, a Ministry of Finance release noted.
It will 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 the India Infrastructure Financing Company Limited (IIFCL). (ANI)
This story has not been edited. It has been published as provided by ANI