West Bengal increased its infra spend five times in seven years: Amit Mitra

West Bengal Finance Minister Amit Mitra
West Bengal has increased its spend on infrastructure by almost five times to Rs 9,553 crore this year, the state’s finance minister, Amit Mitra said.

In a press release issued by the CII at the launch of a report titled ‘West Bengal 2.0 – confluence for logistics’, Mitra was quoted, “The government of West Bengal has increased the infrastructure spend in the state by almost five times with Rs 1,758 crore expenditure in 2011 going up to Rs 9,553 crore in 2019.”

Industry body CII and consultancy firm KPMG released the report.

The minister said that there has been a 191 per cent surge in warehousing in the state and the Inland Water Transport World Bank project, the Roll on Roll off project, the Amritsar Kolkata Industrial Corridor, the Asian Highway Project, the Kaladan Multimodal Project and several such initiatives have put West Bengal and Kolkata very prominently on the logistical map of the nation.

According to the press release, Mitra said that Flipkart’s initiatives in the state has been generating employment of around 6,000 persons and Amazon has 620,00 square feet of fulfilment centres in the state.

He emphasized that West Bengal and Kolkata are strategically placed in terms of infrastructure connect with India and its South-Eastern and Far Eastern neighbourhood and the World Bank project of a masterplan for logistical infrastructure in and around Kolkata will be a huge strategic jump for the state.

With logistical investments coming to the state due to its huge catchment area, the state’s GDP has shot up to 12 per cent.

The report stated that West Bengal can attract an investment of around Rs 4,300 crore by 2020 as it is expected to be the centre of growth in the logistics sector owing to an array of developmental projects which can improve the state’s agricultural and manufacturing output as well as further boost connectivity to south and south-east Asia.

Based on the current industrial, logistical ecosystem and the potential to further trade, the report has indicated that five locations – Dankuni, Durgapur, Tajpur, Malda and Siliguri, have the potential to host logistics parks, which will generate a collective investment of Rs 140 crore and generate direct employment of around 31,500 and another indirect employment of 94,500 respectively.

Out of the total 80 active inland container depot (ICD) in the country, West Bengal has only one in Durgapur which is spread across 20 acres and can handle 60,000 twenty-foot equivalent units (TEU) of containers. Another ICD is being developed in Siliguri in the northern part of the state which can improve container movement across the north-east as well as Nepal and Bhutan.

The report stated that the market size of the state’s logistics sector can reach Rs 2,000 crore by 2020 aided by improvement in infrastructure like ports, road and rail connectivity.

To fructify the potential, the report has recommended that the state leverages the benefits of the Logistics Parks Policy by not only ensuring better coordination between various state departments but also coordinates with the Centre to shift its approach towards “coordinated consensus-based decision making across the entire value chain of the logistics sector”.

Apart from Centre-state coordination, the industry body and the consultancy firm has also suggested that digital technology be put to use.

“It can bring in improvements like route optimization, improved capacity utilization and reduced inventory cost”, the report said adding that private players be roped in on this front.

Digital technology, the report argued, can help improve cargo movement by demand forecasting via data analysis, track cargo movement and the load, improve warehousing costs by increasing the movement of cargo and hence reduced storage costs as well as automation of the warehouses.

Industry estimates suggest that the total logistics sector across the country is growing at a CAGR of 10.5 per cent. The sector is likely to be worth Rs 21,500 crore in 2020, there is potential to drive the growth rate higher by 2-2.5 per cent by eliminating inefficiencies.

Currently, a third of the logistics cost in India is on account of transportation and storage-related issues.

  • West Bengal is India’s fourth-largest economy
  • West Bengal has potential to lead logistics growth in the country
  • West Bengal can attract investment of Rs. 4,300 crore by 2020
  • Removal of operational inefficiencies can further logistics sector growth in India by another 2-2.5 per cent

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