1. WAREHOUSING: BEYOND GODOWNS WAREHOUSING: BEYOND GODOWNS A PRESENTATION BY CONFEDERATION OF ALL INDIA TRADERS NEW DELHI

2. 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.

3. 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.

4. WAREHOUSE PAST & PRESENT

5. 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.

6. 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.

7. 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:

8. 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.

9. 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

10. 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.

11. 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.

12. 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.

13. 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.

14. 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..

15. 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.

16. 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. ISSUES

17. 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.

18. 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

19. 11.The labour laws and taxation laws as are applicable to SEZ should be applicable to warehousing also. 12.Some sort of warehousing needs to be developed in cities also to meet the local demands of storage. 13.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. 14.There should be provision for cleaning, processing, packing & re- packing of goods at each warehousing center. 15.The Warehousing Care Taker should be allowed to use part of the area for residential purposes so as to exercise proper maintenance.

20. 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.

21. 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.

22. 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

23. 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. CONCLUSION:

24. THANK YOU You were good audience