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Union Budget 2021: PM Modi’s vision of making India $5 Trillion economy to be one of the key objectives

The Union Budget 2021, which will be presented on February 1, will decide the market direction for the next few days. Our PM’s vision of making India – A Global Manufacturing Hub and becoming $5 Trillion economy, will be one of the key objectives.

Union Budget 2021: PM Modi’s vision of making India $5 Trillion economy to be one of the key objectives
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All eyes are now set on Budget 2021 with the hope that taxpayers will be given some respite as the novel coronavirus pandemic has hit the Indian economy adversely impacting almost all sectors -- agriculture, aviation, manufacturing or the service.

The Union Budget 2021, which will be presented on February 1, will decide the market direction for the next few days. Prime Minister Narendra Modi’s vision of making India – A Global Manufacturing Hub and becoming $5 Trillion economy, will be one of the key objectives of the upcoming budget.

Presently, PPP Projects and Major Port Trusts compete for cargo at Ports, which leads to conflict of interest. It is important that Major Ports should act as enablers with PPP projects driving the growth.

CEO and Managing Director of Essar Ports Ltd, Rajiv Agarwal said, “Ports will play a pivotal role in achieving this objective and the budget should also focus on increasing the contribution of Ports sector to the country’s GDP. Ports is a significant driver of EXIM trade hence it becomes necessary to keep logistics cost low to encourage exports.”

Indirect taxes on port services has increased to 18 per cent GST as industries like Thermal Power Plants, Fertilizer and Refineries are needed to pay higher logistics and manufacturing cost (on account of no GST Credit) for their raw material movement like Coal, LNG and Crude Oil, POL etc. This is impacting the competitiveness of sea transport as an option as compared to rail and roads that are less environment friendly modes of transport. Hence, GST for sea transport should be reduced to 12 per cent for more sustainable benefits.

“To further strengthen the current position of the industry players, it is critical for ports to be given enough autonomy and decision making power to stay ahead in terms of modernization and technological enhancements. Mechanized berths, sufficient stockyard and multimodal evacuation systems for fast turnaround of vessels are key enablers for productivity and efficiency of Ports & Terminals. To achieve this, investments will be required in dredging, developing adequate civil infrastructure and securing land along with latest technology equipment to create a mechanized and environment friendly cargo handling,” Agrawal added.

Moreover, Rajiv Agrawal stated that the budget should also focus on development of Port bases industries and manufacturing hub. Taking que from the success of Singapore, Dubai, Antwerp, Rotterdam and Houston for blue economy with all round development, we believe Hazira (Gujarat) and Paradip/ Mahanadi (Orissa) are two such locations which can be identified as frontrunner for Port based Industrial City prototypes in India. Innovative proposals for large scale development by private players must be awarded on high priority to boost the growth of sector.

In times of such uncertainties like the pandemic, “Aatmanirbhar Bharat” or a self-reliant India, is indeed a well thought out roadmap to encourage people to be ‘vocal for local’ for a future-ready India.

Every year the Budget brings a lots of hope, however, this year will be more important from the perspective of the remedial actions that will be taken by the Finance Minister to revive the economy.

Besides, for 2021-22, Finance Minister Nirmala Sitharaman has said the budget will see a massive public sector investment and expenditure push, including in infrastructure and health sectors. Along with these two sectors, real estate, construction and railways too, are expected to be in focus in the budget.

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