WAREHOUSING: BEYOND GODOWNS
A PRESENTATION
BY
CONFEDERATION OF ALL INDIA TRADERS
NEW DELHI
MISSION
• A Mission to preserve agri produce and
other commodities for progress & prosperity
of rural and urban India.
• A conduit between producers, importers and
retailers by warehousing sufficient quantity
of
goods
for
maintaining
uniform
availability
of goods to consumers at
reasonable uniform prices through effective
distribution network.
PREAMBLE
• Whatever is produced or imported should reach
the retailers in such quantity that shortage do
not lead to inflation. Neither the agro produce
go waste nor domestic production of other
commodities should become useless for want of
proper warehousing.
• Whatever is produced or imported has to be
transported at various locations, received and
unloaded,
properly
stored
and
timely
dispatched further in a systematic manner.
• While doing this, it has to be ensured that the
goods are not damaged or destroyed. It should
also to be noted that required facilities for
intermediary service providers during this
process are fully taken care of by providing
them with need based facilities.
WAREHOUSE PAST & PRESENT
PRESENT STATUS
• At present warehousing is restricted mainly to
construction of godowns and giving them on rent.
• Major storage facilities are with govt agencies. There
is large gap between demand for storage facilities
and its availability.
• In many cases, it has resulted into use of godowns
being shifted from storage of agro produce to
industrial products and further resulting into storage
of agro products being stored in open.
• Lack of proper supervision and proper inventory
management has also resulted into rioting of food
grains.
• Insufficient cold storage facilities have resulted in
perishing of most of our fruits and vegetables in
large quantity. The poor logistic facilities including
transportation are yet another factor which leads to
deteriorating warehousing.
VISION
• Our vision is to link production to
consumption through logistics solutions where
warehousing plays a catalyst role at every
point in the chain of distribution of goods.
• It should result in facilitating fast movement
of goods with cut in post manufacturing cost.
• We are of the considered view that the
warehousing should be used as a place of
trans-shipment and not as a stockyard or
dumping godowns.
• We also visualise two types of warehousing
i.e. the one for raw produce and the other
one for finished products.
BENEFICIARIES
•
The beneficiaries of warehousing have to be
wide spectrum of society which is involved in
production, import and distribution of goods.
•
The biggest beneficiary will be farmers who
will get remunerative prices by avoiding
distress sale and consumers as well since
proper and regulated warehousing will help
in availability of goods at reasonable prices
due to proper distribution and supply
mechanism.
•
The following are the prime beneficiaries of
warehousing system:
1. AGRICULTURIST
•
Raw material to farmers like seed, manure,
fertilizers, pesticides and insecticides etc. will
be properly stored ensuring their availability.
•
Similarly post-harvest produce can also be
stored.
•
The agriculturist would be able to pledge his
stored produce to raise funds.
•
The farmers can give their fruits cutting
schedule to warehouse keepers.
•
Fruits
plucked
can
be
immediately
transported
in
cold
storage
vans
to
respective cold storage which will be a part
of warehouse.
2.
TRADERS & SMALL &
MEDIUM ENTERPRISES
• The transporters prefer to carry full truck
loads from point to point whereas in most of
the cases the traders and SME's undertake
supplies in small quantities. Thus dispatching
part loads becomes difficult and expensive.
• Warehouses can be used as trans-shipment
hub for effective movement at reasonable
cost for movement of goods belonging to
such sections
3.
INDUSTRY
• It is a general notion that post manufacturing
expenses should be minimized so as to reduce
the cost of the products. Presently, major
manufacturing is done either in cities or in areas
far from cities. The storing, packing and dispatch
of finished products from such areas often proves
costly.
• If proper warehousing is available, the industries
can send their products in bulk to different
warehouses where storing and packing can be
done and simultaneously the distribution of goods
to different locations can take place from such
warehouses in a systematic manner.
4.
IMPORTERS/EXPORTERS
• International consignments always move in containers
which are subject to high rentals. It is necessary to
ensure that waiting period of containers is reduced to
minimum.
• Hence, it is necessary that proper handling facilities
for containers are provided in warehouses. Further, it
is also necessary that stuffing and de-stuffing of
containers should also be done in warehouses
whereas on the other hand, proper arrangement of
customs office should also be ensured within the
warehouses.
ISSUES
• In the wake of economic growth and its continuation
to higher level, an effective and proper warehousing
mechanism in the country is the need of the hour.
Therefore, making an appraisal of the current
warehousing system, the following are the issues
which are being confronted by the cross section of
stakeholders and needs to be considered for future
warehousing system:
a.
Provision for Cleaning, Storing, Packing & Supply
of fruits, vegetable, meat, mutton and fish is
being carried in major urban areas whereas their
production /availability is at far distant places.
Therefore, the warehousing is needed at places
near to the crop growing areas or at production
centres.
b.Urban areas have registered substantial
increase in population and have also seen
constant increase in prices of the
immovable
properties.
Under
new
development plan of city, the storage,
warehousing and godowns have been
prohibited, as it has been done in recent
Master Plan for Delhi. Therefore, to meet
the storage requirements, it will be
necessary
to
have
warehousing
adjoining to cities.
c. Warehousing has to match with the flow of
material. The loose material from taluka’s
moves upward to district and then state
markets. Thus, at each point warehousing
is needed in sizes depending upon the flow
of material.
d. The warehousing has to take care of
seasonal
demand
and
simultaneously
storage of non- seasonable goods is also
important.
• The cost of land and construction thereof has
gone up substantially. Hence warehousing is
no more an economically and commercially
viable business. The cost of labour and
power has also made storage of material
very expensive.
f. The taxes like mundi tax, entry tax and
octroi etc. have proved to be major hurdles
in smooth movement of material from one
state to another state.
.
g. High rent offered by big manufacturers and
corporate houses having high profitable
goods, have reduced the space availability of
agriculture and other produce.
h. Lack of awareness amongst farmers about
availability of warehousing facilities do not
motivate them to store their goods in
warehouses available at present.
i. A systematic mechanism to accumulate and
divert agriculture produce to warehousing is
not available.
j. Lack of banking facilities in villages don’t
allow farmers to avail credit facilities against
warehousing receipt. Same is the case with
other sections of economy.
k. Lack of broadband facilities makes it difficult
to link various warehouses in rural India.
ISSUES
1. Warehouses should be developed across the
Country on PPP model basis. The Traders'
Associations or the Farmers' Associations should
be invited to join hands with the Government for
development of Warehouses on PPP model. A
maximum limit for warehousing particular
commodity or group of commodities needs to be
prescribed in order to avoid mis-use of
warehousing and preventing it to become a
stockyard or dumping godown.
2. Special emphasis should be laid down to upgrade
and modernise existing APMC's. and Foodgrain
Markets all over the Country from the point of
view of warehousing.
3. The Govt. should make available needy land
and/or acquire land for warehousing on the
pattern of land earmarked for Industrial areas
4. The Govt. should extend financial assistance for
a seed capital of 40% of the cost of the project
to the entrepreneur, by way of subsidy or
otherwise.
5. The cash subsidy granted by NABARD should be
on realistic basis and linked to the cost of project
rather than based on predetermined cost of
construction at 150/- per sq. Ft.
6. The Nationalised banks should be directed to
make available credit facilities for construction
of warehouses and its ancillary activities, at
cheaper and nominal rate of interest.
7. The Government should provide a non-refundable grant
up to 50% of cost of the project, as subsidy.
8. The loans granted for warehousing, should be governed
by the Credit Guarantee Scheme of Government of India.
9. The term loan repayment schedule should be spread over
15 years with moratorium of first 3 years.
10.Like
SEZ
whatever
material
is
purchased
for
construction of warehouses, the same should be free
from all taxes i.e. Central Excise, Service Tax, VAT and all
other local taxes including proposed Goods and Service
Tax (GST).Cheap electricity should be made available for
running the warehousing
11.
12.
13.
14.
15.
The labour laws and taxation laws as are applicable
to SEZ should be applicable to warehousing also.
Some sort of warehousing needs to be developed in
cities also to meet the local demands of storage.
The transportation including cold storage vehicles
used for bringing goods from farm/production
centres to warehouses and further transportation of
goods from warehousing to different destination
should be deemed to be part of warehousing project.
There should be provision for cleaning, processing,
packing & repacking of goods at each
warehousing center.
The Warehousing Care Taker should be allowed to
use part of the area for residential purposes so as to
exercise proper maintenance.
16. Some percentage of the area of Warehousing should be
allowed to be used for commercial purposes, in order to
make it a viable project. But in no case, any kind of selling
activities should be allowed in such warehousing.
17. Proposition for conversion of Agriculture land for purposes of
warehousing and commercial activities, should be processed
by a single window clearance Forum.
18. A Warehousing Monitoring Committee comprising of Govt.
officials and Traders, Farmers and SME's, should be formed
both at Central and State levels to monitor systematic
development of warehousing in the Country.
19. There should be a Warehouse Certification Authority
comprising of person from different fields like Architect,
Agriculturist, Traders etc. to testify individual warehousing
facilities, capacity and its prudence to perform core functions
of warehousing.
20.The Government should take steps to ensure that all the
agricultural and other goods stored in warehouses are
insured against all types of damages.
21.All the warehouses should be designed in accordance
with National policy of the Government in respect of
handling, storage and transport of food grains.
22.Rs.2000 crores allotted for creation of warehousing
facilities under Rural Infrastructure Development Fund,
as announced by Hon’ble Finance Minister in the Union
Budget 2011-12 should be released to warehousing
owners at the earliest. This amount should be repayable
in 20 quarterly equal installments, to commence on
expiry of moratorium period of 9 years. This amount
should be placed at the disposal of Warehousing
Development and Regulatory Authority of India.
23.A special task force may be
constituted to
make an in-depth
study of the
warehousing need in
India with a time
bound schedule
for submission of its report
to
WDRA.
24.An effective computerisation system
needs to be developed and all sorts of
warehouses should be linked with
such system so as to monitor
factual position of warehouses
CONCLUSION:
Warehousing should be treated as essential service
industry which would generate employment in
Rural and Urban areas. Its size, capacity and
facilities have to be assessed on the basis of the
needs of local farmers/producers or other stake
holders. It should be equipped with modern
communication facilities with well connectivity to
highways. Major Warehousing Hubs and Minor
Warehousing Hubs will prove boom in distribution
of goods and stabilization of prices by controlling
inflation of our country.
THANK YOU
You were good audience