Budget 2021: What’s in it for the Logistics Sector?

Budget 2021

With a fresh year pushing forth new expectations and hopes for an industry that is still recuperating, new hopes have been pinned on the Budget 2021 for what it may herald for the logistics sector.

In the aftermath of the pandemic-induced lockdown and subsequent impact of a year that battered industries and economy across the globe, 2021 is now seen as a year of fresh expectations and possibilities and the Budget 2021 comes as the first glint of hope for the country’s core sectors.

Most analysts are expecting favourable announcements for the logistics and automobile sectors.

There are expectations that the Centre may roll out a roadmap for vehicle scrappage scheme to push the automobile sector, on the whole, and the commercial vehicle segment, in particular. There is also demand for subsidy/incentives for using EVs for commercial/logistics purposes and for transportation of essential/food products.

With the logistics industry in the cusp of a deeper plunge in digitalisation, analysts have called for Government support in the form of tax concession to support and encourage investment in technology that will herald operational and cost efficiency in the long term and give impetus to India’s logistics industry in terms of standing up to global competition.

In addition to this, Banking and finance space are also one of the much-awaited spaces that anticipates favourable announcements. With talks of the government setting up a bad bank to takeover NPAs from public sector banks, experts are keen on how that would be capitalised. Based on the recommendations of the 2014 PJ Nayak committee, the Centre is looking to create a bank investment company to consolidate its holdings in the PSBs, experts believe.

The much-awaited National Logistics Policy is also expected to be rolled out soon and the Budget expectations this year are also keen on the nitty-gritties of the policy and the overall transformation that it may spell out for the industry that is reeling and recovering from the shadow of the pandemic.

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