DMPQ: Recently infrastructure status was given to the logistics sector? Analyse the advantages and major hurdles. (economy)

by

With growing sectors like automotive components, pharmaceuticals, cement, textiles, FMCG and e-commerce, there was the need of the healthy and efficient logistics sector. India rank 35 out of 160 in the logistics performance index. ( This is quite low). Hence GOI recently granted infrastructure status to the logistics.

 

Major benefits attached by granting infra. Status  with the logistics sector are as follows:

  • Availability of easy credits to the companies operating within these segments. Now long-term credit from banks and other Financial institutes can give credit to these companies.
  • It will also help to attract foreign investment.
  • More funds and capital will make sector more efficient and thus help to reduce per unit cost incurred in logistics. This will have cascading effect on improving competitiveness.
  • It will also help to prevent the damages of Perishable items in the agriculture sector by having a healthy cold chain supply chain.

 

Major Impediments:

  • Road Infra in bad shape.
  • Banks lack of lending capacity. Facing NPA issues.
  • Flight of capital due to Quantitative easing.
GPSC Notes brings Prelims and Mains programs for GPSC Prelims and GPSC Mains Exam preparation. Various Programs initiated by GPSC Notes are as follows:- For any doubt, Just leave us a Chat or Fill us a querry––