1. 1

2. 2

3. Infrastructure is one of the most important components of
the warehousing sector. An efficient warehousing operation
hinges critically on high-quality supporting infrastructure
that includes a good national highway network, interstate
roads and congestion free city roads. The total share of
organized warehousing space is less than eight per cent of
the total warehousing space in India. The industry is
fragmented and largely unorganized and is dominated by
small players with small capacities, not well-linked with the
national highway network and interstate roads
3

4.  Procurement of land in a strategic location with clear title and proper
approvals is still a key challenge to set up a warehouse. Government
policies have intervened with the help of various initiatives through
various agencies. The lack of existing clear land classifications in
Indian cities and the reclassification of land are major concerns as far
as the development of warehouse zones are concerned. The
availability of affordable land is another concern for the industry. It is
getting increasingly difficult to procure land at affordable prices for
building warehouses due to escalating valuations even in the fringes of
large cities. To add to the misery further different states have different
rules regarding agricultural land acquisition, which create entry barriers
and have serious cost and time implications.
 Conversion of Land use is another herculean task for the stake
holders, no defined policy of authorities is in place for such conversion
focusing on warehouses. Even authorities like DDA do not have any
structured policy for such transactions.
4

5.  There is no clear policy/ direction from government on land
registry or change of land use for warehousing as for other
industries.
 Due to this many illegal warehouses are operating specially on
non-commercial lands which give unrealistic competition to
organized player of warehouse industry
 New Land Acquisition Bill is on table but it is also like A Good
Looking Empty Shell, a law that looks good on paper but will
produce a very different result. This is true not only because of
internal flaws or drafting mistakes, but because of its very
character and spirit
 Whatever quantity of land acquisition takes place, major part of
it drives into residential and public infrastructure due to heavy
immigration burden on Delhi & NCR region which in turn shrink
the share of available commercial land
5

6. 6
22
11
12
25
6
24
Distribution of Land (%)
Residential
Commercial
Green Area
Transport
Institutional
Industrial

7.  It is apparent from the above chart that only handful of
land is available for commercial activities out of the total
land acquired for development
 Due versatile issues involved as discussed in succeeding
slide fewer quantity of land gets acquired for development
and share of commercial land being so low in distribution
chart pose major threats for the growth of industries such
as warehouse & logistic
 First stage of progression of warehouse industry depends
on the procurement of useable land which is converted
into varied useful infrastructure.
7

8.  Land pooling
 Long-term lease with land owners beside acquisition
 Compensation up to 4X of market price for rural lands per new Land Acquisition Act
 Land lying near highways not fit for agriculture can be converted to commercial use
 New law to allow private bodies to acquire land for certain specific purposes
 Proper Rehabilitation scheme for displaced people beside owners of land
 Mechanism to tackle variation in Land price across states
 PPT model to replace government land development schemes
 State government to follow policy of Land purchase rather acquisition
8

9.  Varied Land laws
 Compensation price
 Fragmented holdings
 Difficulty in obtaining contiguous land
 Tough resettlement and rehabilitation process
 Constitutional hurdles
 Pledged Land lying with local money lenders
 Widespread dependency on agriculture
employment
9

10.  Deficiency of commercial land
 Inopportune size of properties
 Ambiguous Land use conversion Laws
 Problematic Zoning Laws/ local laws
 Exorbitant Development government costs
 Properties under Litigations due to inheritance
 Multiple sales not properly recorded
 Remote area with no connecting infrastructure
 Prevalent Land mafia and Local bodies
10

11. The demand for warehousing comes from many sources with
specific needs. The lack of warehousing standards and
accreditation poses a significant challenge to the industry
where quality and flexibility of available warehousing space is
a major concern. In most cases of ready-to-occupy
warehouses, the companies have to invest further in order to
upgrade the space and its specifications to standards that
support their operations effectively. As we go forward, the
demand from occupiers is expected to put pressure on
developers and owners to adopt the standards formulated by
policymakers. Many of the ready-to-occupy off-the-shelf basic
warehouses do not easily lend themselves to up gradation in
terms of infrastructure, technology, compliance and
accommodating modern equipments
11

12. Access to adequate and timely credit at a reasonable cost
is one of the most critical problems faced by this sector.
The main reason for this has been the high-risk perception
among banks about the unorganized nature of this sector
and the high transaction costs for loan appraisal. Since a
majority of the players in this sector are small or medium
entrepreneurs, they are unable to provide collateral in
order to avail of loans from banks and are hence denied
credit. Defaults in repayment of Debt also force lenders to
shy from this sector which happens majorly due to lack of
policy support from regulators.
12

13. Power outages are a major problem currently
plaguing modern warehouses and cold chains
leading to a huge wastage of products every
year. The increasing cost of power adds further
to the warehousing cost. In some remote areas
power is not at all available making functioning
of warehouse activity difficult from such
locations. Approval process for Installations of
DG set is cumbersome and time consuming
13

14. Longer transit time and inadequate
infrastructure also increase transportation
costs. This leads to collection of material
directly at mini-warehouses distributed across
locations thereby defeating the purpose of
augmentation and distribution. Delivery
schedules are severally hurt due this and add
to loses of industry
14

15. The delay in the implementation of GST and
the existing complex sales and transport tax
system tends to discourage the establishment
of a national-level centralized distribution
center or hubs, the likes of which are often
seen in developed countries
15

16. Regulations exist at a number of different tiers,
imposed by national, regional and local
authorities. Regulations often differ from city to
city, hindering the creation of national networks
16

17. Although both the practitioners and the
academicians are increasingly aware of the
importance of logistics and warehouse chain,
however the field is still under penetrated as far
as research is concerned. It is important to
prioritize research and development so that
various weaknesses in the industry could be
identified and improved
17

18. 18

19. Though warehousing is an integral component of
the supply chain, currently warehouses are
structured on a standalone basis. Warehousing
service providers often struggle with other supply
chain stakeholders for integration of information
and visibility. This disintegration in the upstream,
downstream or both ends of warehousing leads to
unpredictability of usage of space and facilities. In
addition, this impacts the value-added service
performance level expected from warehousing
service providers
19

20. The lack of training institutes adds to the woes
of the warehousing sector. Evolving warehouse
management processes and operations with
more demanding customers, lack of attraction
for new recruits arising from poor working
conditions, relatively less attractive incentives
and benefits, and the emergence of attractive
alternate career options are reasons that
contribute to the skill shortage in the
warehousing sector
20

21. The warehousing sector in India, with some
exceptions, is characterized by low technology
levels that act as a handicap in the emerging
Indian market. Limited real-time visibility with
manual inventory management, warehousing
management, documentation, billing and reporting
has raised doubts on the sustainability of a large
number of warehousing players. Robust
introduction of IT tools & software in the sector is
the need of today.
21

22. A majority of the Indian warehousing players
today have inefficient methods of storing,
handling and monitoring of goods. They also
suffer from stock visibility issues, stock
traceability, higher pilferages and damages
22

23. There is an absence of standardized operating
processes and procedures at warehouses. The
material unloading, handling, storing and
loading are more often carried out in an ad-hoc
manner. This not only builds in inefficiency but
also leads to many mishandling problems
including damages and subsequent increases
in cost
23

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25.  Trade License
 Shop & Establishment Act
 Holiday & Festival Act
 Sarpanch for Gram Panchayat Lands
 Food Safety and Standards Authority of India
(FSSAI)
 Drug License
25

26.  Registration with office of Labor
Commissioner Zone wise
 Registration Mandatory
 No Online payment portal in any state
 No online facility for submission of
Documents & issue of Registration
Certificate
 No linear structure of fees- all states have
their own procedure & fee structure
26

27.  Registration with Municipal Corporation
Department Zone wise
 No Online payment portal in any state
 No online facility for submission of
Documents
 Only some states has facility for submission
of return on annual basis
27

28.  Registration with Municipal Corporation
Department Zone wise
 No Online payment portal in any state
 No online facility for submission of Documents
 Different fee structure in every state
 Very minute contribution
28

29.  Registration with Deputy Director on zone
basis
 Filing of various forms & returns
 Maintaining Data of employees
 Maintaining mandatory records & registers in
physical form
29

30.  Registration with office Regional Provident
fund commissioner
 Time consuming
 Complex registration process
30

31.  Registration with District Employment officer
under Ministry of Human Resource
 Superfluous legislation
 Excessive Burden on Companies
 Maintenance of Data in Physical form
31

32.  Application for each premises for concerned
location office District wise
 Opaque procedure
 Complex documentation
 Time consuming process results in delay for
issuance of NOC
32

33.  Registration with office of District labor
officer divided zone wise
 Some primitive clause lead to wastage of
resources
 Maintenance of Data in Physical form
33

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35. Free Trade Warehousing Zones (FTWZ) must
be established by the government by
developing infrastructure to facilitate Industry.
A FTWZ is a special category of Special
Economic Zone (SEZ) with minimum area of
development under FTWZ is 0.1 million sq.mt.
35

36. Salient features of FTWZs are as follow :
Customized categorized warehouses for every
industries such as food, Apparel etc.
Controlled humidity warehouses
World-class information system for cargo tracking
Modern office space with amenities like medical
facility, business centers
Enhanced transportation facilities
36

37. Infrastructure is the backbone of growth and
prosperity for the logistics industry to flourish in
the developed country, special emphasis has to be
laid on the enhancement of the infrastructural
facilities. Particular focus needs to be given on
building world-class road networks, integrated rail
corridors, modern cargo facilities at airports and
creation of logistics parks which need to be given
a status equivalent to Special Economic Zones
37

38. Overcoming the skill gap in logistics industry
requires establishing training institutions. It is
necessary to realize the benefits which best
practice in logistics can bring to the companies so
that the overall service quality of the sector is
improved. Gaps in training have to be filled not
only at the entry level but also in the management
cadre which could be made possible through
specialized graduation and post-graduation
courses focused on Operations and Supply Chain
management
38

39. A logistics park is a stipulated area that facilitates
services such as warehousing, cold storage, multi-
modal transport facility, CFS, ICDs, etc. Logistics
parks facilitate loading and unloading of cargo for
distribution, redistribution, packaging and
repackaging. More & More of such parks should
be developed in the vicinity of emerging industrial
hubs such as NCR, Mumbai, Chennai,
Hyderabad, Bangalore etc. These parks are
connected through well-laid multi-modal transport
facilities. Logistics parks are similar to FTWZs but
also cater to the domestic market
39

40. Emphasizing on R&D is essential mainly because
it encourages the use of indigenous technology
which can make the industry more cost
competitive and it also leads to the improvement
in services due to the use of better and more
streamlined services. Particular focus needs to be
given on research in process excellence which
can help eliminate inefficiencies and bring Indian
logistics on par with global practices
40

41. The introduction of the Warehousing Development
and Regulatory Authority (WDRA) will make
provisions for the development and regulation of
warehouses. The provisions of WDRA also lead to
increased efficiencies in the lending portfolios of
banks, as well as further enhance the interests of
lending institutions in ensuring credit with
reference to goods in warehouses. The
implementation of warehousing receipts under the
supervision of WDRA is expected to ensure the
smooth functioning of the system to foster the
growth of warehousing
41

42.  The government has to introduce decent tax
structures to reduce supply chain costs and
encourage the participation of new players
 The traditional tax policies failed to encourage as
they led to cascading effect leading to higher cost
for such industries
 The government has to take a step forward to
phase out Central Sales Tax (CST) and introduce
GST. GST, with a uniform tax-rate, will help the
logistics industry in re-arrangement.
42

43.  The tax on vehicles and tax on goods levied by the state
governments should be submitted in the GST
 All transport equipments and forms of services for
transportation of goods by rail, air and road must form an
integral part of the comprehensive GST base
 GST is also expected to encourage the construction of
centralized warehouses at key strategic locations that can
operate on new models, in turn outsourcing the logistics
activity to the organized segment
 A simplified tax regime will help logistics players service
multiple markets and offer end-to-end solutions at much
lower costs
43

44.  CONTRACT LABOR
(REGULATION & ABOLITION)
ACT
 TRADE LICENSE
 SHOP & ESTABLISHMENT ACT
 DRUG LICENSE
 Deputy Labor Commissioner of
labor department under Ministry
of Labor and Employment
 Office of Commissioner in
Municipal Corporation of area
 Chief Inspector of Shop or Joint
Labor Commissioner of labor
department under Ministry of
Labor and Employment
 Drug Control Department, Delhi
Government
44

45.  FOOD LICENSE
 NOC Fire Safety
 PROFESSIONAL TAX
 EMPLOYMENT EXCHANGE
Act
 LABOR WELFARE FUND
 STANDING ORDERS ACT
 Food Safety and Standards
Authority of India( FASSAI) at two
Level Central & State as per
prescribed norms
 The Director or Chief Fire Officer
of Fire Department under Delhi
Government
 Municipal Corporation under State
Government’s
 District Employment officer
 Welfare commissioner or
Assistant Labor Commissioner of
Labor Department
 Deputy Labor Commissioner or
Labor Commissioner
45

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