CARGOCONNECT-MARCH2024 - Flipbook - Page 20
FOCUS : BUDGET 2024
The Union Budget 2024’s pivotal
focus on infrastructure development, aligns seamlessly with
our vision for enhanced logistics
efficiency. We appreciate and commend the government’s efforts
towards Green Energy, aligned
with the Nation’s commitment for
‘Net-Zero’ by 2070. The announcement of three major economic
railway corridor programmes,
spanning energy, mineral, and
cement corridors, port connectivity
corridors, and high-traffic density
corridors under the PM Gati Shakti initiative, is poised
to be transformative. The integration of dedicated
freight corridors is poised to catalyse GDP growth
and significantly reduce logistics costs. With an
expedited development of various infrastructure
projects, the government’s proactive approach is
set to spur economic growth. The India Middle East
Europe Economic Corridor announcement is particularly
game-changing, strategically positioning India on
the global trade map.
RAMPRAVEEN SWAMINATHAN
Managing Director and CEO, Mahindra Logistics
The Interim Budget for financial
year 2024-25 has kept to the
path of fiscal prudence and
growth momentum. It effectively
complements the Hon’ble Prime
Minister’s vision of a ‘Vikasit Bh
arat’ (developed India) by 2047.
The increase of 11.1 per cent in the
capital outlay for infrastructure
will enhance connectivity and lastmile linkages. The establishment
of port connectivity corridors,
high traffic density corridors, and
commodity (energy, minerals and
cement) corridors will greatly improve supply chain
efficiencies and give a significant boost to domestic
and international trade. This aligns with the goals
outlined under the PM Gati Shakti Yojana – connecting
hinterland to ports, and demand to supply, thus opening
new possibilities. The Government’s unwavering focus
on priority areas such as skilling; energy security;
reducing the compliance burden for MSMEs; and
achieving gender balance in the labour force is
truly commendable. It will ensure that the country
is prepared to capitalise on emerging opportunities
such as nearshoring.
RIZWAN SOOMAR
CEO and Managing Director – North Africa and India
subcontinent, DP World
20 | CARGOCONNECT MARCH 2024
Further, Indian carriers have proactively placed orders for over 1,000
new aircraft, she shared.
In a significant move towards
bolstering the electric vehicle (EV)
ecosystem, Sitharaman revealed about
the government’s plan to expand and
strengthen the manufacturing and
charging infrastructure for EVs.
“The government will expand
and strengthen the EV ecosystem by
supporting manufacturing and charging infrastructure,” she emphasised,
underlining the pivotal role of EVs in
the country’s sustainable development
agenda.
To achieve 10,000 public charging
stations by the end of 2025, the necessity
of building over 300,000 public charging stations by 2030 is paramount for
the country to attain a 30 per cent EV
adoption rate. Currently, the ratio of EVs
to charging stations is nearly 9:1, while
the ideal ratio should be 4:1, meaning
four cars per one charging point.
Highlighting the government’s commitment to structural reforms towards
fostering green growth, Sitharaman also
disclosed the launch of a new scheme for
bio-manufacturing aimed at promoting
sustainable practices. She also announced
a new scheme for converting biomass
into Compressed Bio Gas (CBG) and
phased mandatory blending of CBG
with natural gas to be used as fuel for
vehicles.
In a boost to development of o昀昀shore
wind power capacity, Sitharaman also
mentioned that the government would
provide viability gap funding (VGF) for
harnessing initial capacity of 1 GW of
o昀昀shore wind power. The FM said this
will help to achieve net-zero emissions
by 2070 and added that the government
is ready to assist states.
India has a target of 500 GW of
renewable energy capacity by 2030.
Given the capital-intensive nature of these
projects, the ministry of new and renewable energy’s (MNRE’s) revised strategy
paper last September had highlighted
the need for central financial support
to bridge the gap between actual tari昀昀s
and designated power purchase rates.
This is particularly crucial given the high
costs of setting up turbines on the seabed
and the associated power evacuation
expenses. In 2022, MNRE had informed
a parliamentary committee that the per
megawatt cost of o昀昀shore wind projects
could range from `20 crore to `25 crore,
varying based on technology, marine
conditions, and distance from the shore.
Acknowledging the 昀椀nancial challenges,
the committee had recommended VGF to
ensure project viability and the necessary
transmission infrastructure.
The government’s visionary corpus
of `1 lakh crore, featuring a 50-year
interest-free loan can be seen as a beacon for tech-savvy innovation. This is
expected to encourage the private sector
to scale up research and innovation in
sunrise domains.
“A corpus of `1 lakh crore will be
established with a 50-year interest free
loan. The corpus will provide long-term
昀椀nancing or re昀椀nancing with long tenures
and low or nil interest rates. This will
encourage the private sector to scale up
research and innovation significantly
in sunrise domains. We need to have
programmes that combine the powers of
our youth and technology,” the FM said.
The government’s recognition and
dedicated focus on the growth and global
competitiveness of MSMEs is also a crucial stride. The Budget announcements
re昀氀ect the government’s commitment to
timely support, relevant technologies,
and essential training.
“It is an important policy priority for
our government to ensure timely and
adequate 昀椀nances, relevant technologies
and appropriate training for the Micro,
Small and Medium Enterprises (MSME)
to grow and also compete globally,”
Sitharaman attributed to the government’s strategic policies for growth and
innovation of the MSME sector which is
unparalleled in the country’s economic
landscape.
A昀케rming the administration’s commitment to fostering economic policies
that sustain growth and investment,
Sitharaman said the government is
trying to ensure that foreign investment
昀氀ow continues through BITs that focus
on the country’s development interest.
The play on the acronym for FDI, which
the FM says also stands for ‘昀椀rst develop
India’, is important as the country is
in the midst of intense negotiations on
BITs with a number of trade partners,
speci昀椀cally the UK and the EU.
“FDI in昀氀ow into the country during
the 2014-23 period was US$596 billion
marking a golden era. It is twice the
inflow during 2005-14,” Sitharaman
highlighted and pointed, “For encouraging sustained foreign investment, we are
negotiating bilateral investment treaties
with our foreign partners, in the spirit
of ‘昀椀rst develop India’.