Government earmarks Rs 2 lakh crore investment for logistics park

India Infoline News Service | Mumbai | July 21, 2017 10:49 IST

The government has approved a plan to construct 34 mega multi-modal logistics parks at an investment of around Rs 2 lakh crore.

Logistics storehouse
The government has approved a plan to construct 34 mega multi-modal logistics parks at an investment of around Rs 2 lakh crore. These parks would serve as a hub for the private companies and enable them to run their operations centrally and save on logistics cost.
 
"Logistics parks will act as freight aggregation and distribution hubs and will enable long haul freight movement between hubs on larger sized trucks, rail and waterways. It will reduce freight transportation costs," said Road Transport and Highways Minister, Nitin Gadkari, in an interaction with a leading news agency.
 
With the implementation of the Goods and Sector Tax (GST), India has become a single market with the destination-based tax system. GST has a significant impact on the manufacturing chain, supply chain, and retail chain. A strategically placed warehouse improves and facilitates proper supply chain management. It is expected that the logistics cost in the country will go down by nearly 20%. Freight transportation movement on the highways network would increase and unlike other modes of transport, roads address the demand for goods in cities as well as remote areas of the country, thus this investment will greatly benefit the logistics sector.
 
Logistic stocks on the bourses like Blue Dart Express, VRL Logistics, Sical Logistics, Gateway Distriparks and Allcargo Logistics are likely to gain in the near-future due to various factors including government’s support and GST regime.

Disclaimer: The contents herein is specifically prepared by ‘Dalal Street Investment Journal’, and is for your information & personal consumption only. India Infoline Limited or Dalal Street Investment Journal do not guarantee the accuracy, correctness, completeness or reliability of information contained herein and shall not be held responsible.

 

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