• 01-03-2022

Union Budget expectations 2022-23 towards global freight and logistics

India needs to reduce its vulnerability due to over-dependence on foreign cargo carriers. India should have its healthy ocean and air carriers owned and operated by Indian corporates. Covid-19 pandemic exposed the exposure of Indian trade being totally at the mercy of the foreign carriers and the opportunistic price hikes in freight rates to benefit certain countries.

The government should develop a policy document that will encourage large private companies to own and operate ocean and air shipping lines out of India. Since these are highly capital intensive and complex business operations, the govt of India should play the role of a facilitator and extend all possible help to private corporates to set up shipping lines and airlines.

Another area is the production of ocean containers which saw a massive shortage due to these containers getting held up at various ports and delivery centers. As a part of "Make in India," the government of India should offer all possible incentives and tax breaks to those who are manufacturing containers in India. Containerization should be encouraged for Domestic cargo movements, which will revolutionize the cargo movement within the country resulting in faster turnaround of vehicles, reducing dwell time, and eliminating damage and pilferage of cargo.

The logistics cost increases due to the dwelling time of the cargo. One of the ways to reduce dwell time is to increase automation and mechanization of cargo handling. So, industries that manufacture cargo handling and lifting equipment should be given special concessions and interest subsidies. This will also help in "Make in India."

The government of India is promoting the use of solar energy in a big way. Extending these other cold storage warehouses run on solar energy should be given incentives and subsidies. This will help better utilization of farm and dairy products and increase farmers' yield, and at the same time, it is environmentally friendly.

The government of India should also encourage the use of electric vehicles in cargo transportation and should give various incentives and subsidies.

The government of India should further push digitalization and paperless processing of all cargo-related documentation. E-Way bill and E-Sanchit of Indian customs should be further expedited and fast-forwarded.