Mr. Sanjay Kaul - Managing Director & Chief Executive Officer of NCMSL

Agri Infrastructure and Warehousing needs Special Attention – Mr. Sanjay Kaul, MD &CEO, NCMSL It is unfortunate that despite fervent pleas by industry the agri-warehousing and cold chain sector has not been granted “infrastructure status”. There is an estimated 32 million shortage in storage capacity, and even conservative estimates put the immediate investment requirement at Rs. 10000 crore. The Finance Minister had amended section 35 AD of the Income Tax Act to permit full depreciation to be charged in the year of investment. This concession has proved inadequate as it amounts only to a tax deferral and provided no tangible tax relief. It is only the grant of infrastructure status that will provide a major fillip for investment in this vital sector. Agri warehousing currently receives a marginal subsidy through a NABARD implemented scheme. This minuscule subsidy has not helped make investment in warehousing viable. In addition, NABARD under a new window of direct financing should provide direct loans at lower rate of interest to the private sector for warehousing, integrated supply / cold chain and allied infrastructure development activities in the rural areas, under RIDF funds. Mere refinancing and state loans does not comply fully with NABARD’s mandate or purpose for which it was created There is also need to eliminate the need for different VAT registration numbers across states for entities and individuals license by the newly set up Warehouse Development and Regulatory Authority [WDRA]. In fact, VAT / CST should apply only when physical transfer of agriculture produce takes place. This will encourage free movement and trade and serve to stabilize prices of agricultural commodities across the country.