Union Budget 2021: Digitisation key to solving stumbling blocks in logistics sector
There is a pressing need for a complete digital transformation of the industry to handle international shipments efficiently
When the pandemic struck in 2020, one of the few industrial sectors that were able to help the ecosystem was logistics. However, it faced stumbling blocks faced as the sector is not fully digitised. There is a pressing need for a complete digital transformation of the industry to handle international shipments efficiently. Logistics firms shared their concerns and wish list from Budget 2021 with Firstpost.
Dhruvil Sanghvi, Chief Executive Officer, LogiNext
Global and national supply chain is of paramount criticality in 2021 and beyond. Currently, there is a very high degree of compliance and paperwork which makes it difficult for technology companies to serve the global audience and forces companies to shift base outside the country. Urgent steps in this direction will help high growth companies keep base in India, generate employment across the spectrum and help revive the national economy after the shock of the pandemic.
Sanjay Bhatia, CO-Founder, Freightwalla
We hope the Union Budget will announce suitable investments towards the digitization of the shipping and logistics sector. A leap towards this initiative will bring in transparency, reduction in cost, and better cost management. Digitisation should also include implementing smart single-window clearance for smooth processing of shipments or approvals. Such initiatives will prepare us to tackle any untoward incidences in the future, like the current pandemic. Investments in Artificial Intelligence, Machine Learning, and BlockChain technologies can facilitate complete transformation. It can boost productivity in every sector. There is also an expectation that the proposed National Logistics Policy may be announced.
Sonesh Jain, EIR, WheelsEye
Some key expectations from the Budget are the implementation of uniform and subsidised diesel rates, especially for transporters with less than five vehicles; lowered GST slabs for small businessmen to boost profitability; allowing NETC and NPCI to solve toll or traffic-related payment disputes in real-time; empowering software and hardware-related innovation, partner with startups to solve on-ground real problems; develop a data and resource centre to enable easy availability of the logistics related databases and statistical information; standard GPS and other technology-related policies in order to automate toll collection, business operations and increase the safety of the commercial vehicles; and to develop a better custom documentation process and an integrated platform with access to all export formalities for bringing ease and transparency among the importers and exporters.
Alok Sharma, CEO and Co-founder, NebulARC
As India gears up for COVID-19 vaccine distribution this year, the logistics sector needs to gear up big time to ensure a smooth supply chain. In Budget 2021, we expect the government to invest in the digitisation of supply chain management with a focus on new technologies like AI, Machine learning, and IoT. These technologies will eventually decrease the pressure on pharma companies in effectively managing logistics. The government should also consider lowering ocean freight rates that are driven by the demand-supply scenario. This will also reduce the shortage of containers due to port congestion and delays last year. Besides this, we also expect the government to take a proactive step in funding large port construction for container trade to fuel the sector's growth.
Narasimhan Raghavan, Director, Raag Technologies and Services
The year 2020 has been a game-changer for the logistics sector. As we await Budget 2021, we are expecting the government to take steps to further strengthen the sector with reforms related to GST, and most importantly accelerate the implementation of initiatives under the Sagarmala and Bharatmala projects. It must be noted that logistics is also one of the highest employment-generating sectors currently. Therefore, the government must look at creating a thriving ecosystem for logistics leading to the overall economic growth.
We are expecting that the government will take further steps to strengthen the logistics sector with reforms related to GST, and most importantly accelerate the implementation of initiatives under the Sagarmala and Bharatmala projects. It must be noted that logistics is also one of the highest employment-generating sectors currently. Therefore, the government must look at creating a thriving ecosystem for logistics leading to the overall economic growth.
Abhik Mitra, MD and CEO, Spoton Logistics
With logistics holding the economy together even during the COVID-19 pandemic and set to play an even more crucial role in current times, the government must look at providing the much-required financial and infrastructural support to the sector. With India's aim to reduce the logistics cost from the current 14 percent of GDP to less than 10 percent, it is imperative for the government to bring about a groundbreaking transformation in the logistics sector that encapsulates an increased use of digital technologies and automation. We urge the government to take dedicated measures to boost digitalisation so as to drive transparency and bring in the required predictability in logistics.
Prem Kishan Dass Gupta, Chairman and MD, Gateway Distriparks
We expect strong support and initiatives for the EXIM industry which will help in increasing volumes. We hope the 2021 Budget will have enhanced allocation to the Indian Railways for completion of the Western Dedicated Freight Corridor (DFC) project at the earliest so that the industry can benefit from the new rail infrastructure at this time when the focus is to increase manufacturing in India.
As a Logistics company, we are looking at the government’s increased investment in infrastructure, which will provide further impetus to boost the overall economy.
Rhitiman Majumder, Co-founder, Pickrr
The logistics costs in the country at around 14 percent of the GDP are still amongst the highest in the world and this is a key disadvantage for the Indian Industry to compete in the international markets. In Budget 2021, at the first instance, I would urge the government to create an enabling environment for the digitisation of documentation and the seamless transfer of documents from one agency to another reducing the compliance burden on the logistic service provider. Further, currently every corporate in India has to file more than 150 compliances to various government departments through the year, this needs to be rationalised and reduced.
Saahil Goel, CEO and Co-founder, Shiprocket
Despite the tough times induced by COVID-19 , the Direct to Consumer (D2C) eCommerce sector grew at a rapid pace last year. However, a National Retail Policy will help boost the sector even further. As small businesses are going online, we expect the Union Budget to focus on the improvisation of digital infrastructure in tier 2 and tier 3 cities. Better internet connectivity in rural areas will further stimulate the demand for eCommerce. Furthermore, measures to enhance warehousing would also benefit this sector immensely.
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