Aiming to facilitate the development of a strong logistics infrastructure, the Tamil Nadu government on Saturday came out with its Logistics Policy 2023.
This new policy is targeted at reducing the cost of logistics and leveraging private participation aided by initiatives like fiscal incentives for truck firms, container freight stations, warehouse operators, freight forwarders, start-ups, and technology service providers among other related enterprises.
As per the policy various fiscal incentives to market participants, operators, and developers towards improvement in efficiency and visibility of trade and encourage business opportunities through private participation in the logistics sector are offered.
Released by Chief Minister M K Stalin in the Secretariat, the policy vision is to promote an integrated, reliable, cost-efficient, and sustainable logistics system in the state to enhance competitiveness and fast-tracked economic development.
The government of Tamil Nadu in coordination with the Ministry of Railways and through private participation, on a pilot basis, encourages the commencement of container rail services and Kisan rail services on strategic routes under a market development approach.
To promote inter-modal transport that would result in cost-effective services, strategic coastal shipping routes would be assessed and identified.
Also to improve the quality of air cargo-related services, the state will coordinate with relevant agencies, and work with the Central Bureau of Indirect Taxes and Customs and other authorities and operators to take steps for reducing dwell time at air cargo complexes and seaports.
The government would extend the existing single window clearance set up under the aegis of Guidance Tamil Nadu and FaMe TN department to logistics activities for the enhancement of ease of doing business.
To skill the workforce, skill gaps vis-a-vis logistics job roles will be identified and a skill plan for the logistics sector will be prepared. The state will also explore medical and health insurance for heavy vehicle drivers registered in the State at a nominal price.
All such proposed initiatives form part of strategic interventions for cost-effective logistic services by supporting market development. The strategic objective of the policy is to enable integrated and robust logistics infrastructure development and promote the availability of cost-effective and high-quality services.
Adopting new age technologies, enabling skill development, and building resilience and sustainability in the logistics eco-system form part of key objectives.
The outcomes targeted are the reduction of the cost of logistics for export-import as well as domestic freight, leveraging private participation for the development of logistics infrastructure, and formulating an effective coordination mechanism between State and Central agencies for the facilitation and execution of initiatives in the logistics sector.
The policy also has helped keep the consistently high ranking of Tamil Nadu in the LEADS (Logistics Ease Across Different States) index of the Union government and enhanced economic growth and employment generation in the state.
The interventions to achieve the objectives include leveraging the GIS (Geographic Information System) layers of the State Master Plan being prepared under the PM Gati Shakti National Master Plan for enabling integrated planning and connectivity enhancement. Identifying and resolving existing connectivity bottlenecks and developing new infrastructure is another area of intervention.
Earmarking land parcels in upcoming industrial parks, clusters for the development of truck terminals/yards, and for carrying out common logistics activities are cited as one of the proposed interventions. “Development of such facilities will preferably be undertaken through private participation. The government of Tamil Nadu will identify unutilized factory sheds within the existing industrial parks/estates/clusters in the State and make them available for logistics activities, wherever feasible.”
Tamil Nadu government will identify and earmark land parcels, a minimum of 50 acres, at strategic locations for the development of Multimodal Logistics Parks, Logistics parks, Warehousing Clusters, and Private Freight terminals (PFT).
The fiscal incentives would be applicable for 5 years from the date of promulgation of the policy and further extension could be considered based on effectiveness and emerging requirements.
Under the proposed incentives, one-time reimbursement of 100 percent of the patent registration fee in India to technology providers, start-ups, and other business units developing technology-enabled solutions for logistics efficiency improvement subject to a cap of Rs 25,000 per patent will be given.
Also, a 100 percent one-time reimbursement of vehicle registration charges and road tax for 1 year for reefer trucks including retrofitting of the capacity of more than 15 MT by logistics trucking companies in Tamil Nadu. The fiscal incentive will be provided for the registration of the first 500 reefer trucks in the State during the policy period.