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Post Budget 2021: Industry Expert Reactions On Infrastructure

The pandemic led to the acceleration of digitization across levels as online shopping became the new necessity and organizations were seen automating processes with technology solutions to bring in more efficiency.

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The focus on the manufacturing sector in the budget would also help the logistics sector grow further.

The government has extended its Rs 111-lakh-crore ($1.5 trillion) National Infrastructure Pipeline to cover more projects by 2025 in an effort to shore up economic growth as the nation recovers from the pandemic-induced recession.

“To further augment road infrastructure, 8,500 km of road and highway projects will be awarded by March 2022,” Sitharaman said in her Budget Speech.

Building new roads, rail links and other social and economic infrastructure is key for attracting investments and making India a $5-trillion economy.

“Government’s focus on capital expenditure and infrastructure development will be a shot in the arm for the warehousing and logistics sector in the country. The proposed Development Finance Institution will act as a provider, enabler, and catalyst for infrastructure financing. Also, the budget has earmarked a sharp increase in capital expenditure at Rs 5.54 lakh crore in 2022, from Rs 4.39 lakh crore in 2021.

A planned boost to road infrastructure across the country and seven port projects will aid in job creation and income generation. Overall, the large-scale infrastructure augmentation coupled with asset monetization program of core infrastructure assets will go a long way in realising the national infrastructure pipeline, thereby benefiting the logistics sector”, said Mr Anshul Singhal, Managing Director, Welspun One Logistics Parks.

“The focus on infrastructure development in the current budget is indeed a positive move. In fact, the need to increase government spend on infrastructure has been a long pending ask from all industries including building materials. The allocation of Rs 1.10 lakh crore and Rs. 2000 crore towards railways and development of ports under the PPP mode respectively coupled with the government’s plan to complete 11,000 km of national highway will have a significant impact on the economy as well as the building materials industry. Further, the setting up of a professionally managed Development Financial Institution and infusing 20,000 crores to it is also highly commendable.

Lack of alternate financing models has been a key concern that most infrastructure projects hasve been struggling with, the setting up of Development Financial Institution can solve this problem which in turn can lead to increase in number of projects being rolled out as well as completed. In fact, the increased spending coupled with better financing support to the infrastructure industry will not only give the building material sector the much needed boost to recover the lost ground, but should also enable the industry to board the growth trajectory”, Mr Ashwin Reddy, Managing Director, Aparna Enterprises Limited.

“We are pleased to know that the Budget is in line with our expectations. The industry is eagerly waiting to see the results of these measures in our field of work. The proposed solutions include a succinct focus on improving road and railway infrastructure; investments in National highway corridors and economic corridors will aid in the speedy movement of goods and improve turnaround time which, in the long run, will bring down logistics costs significantly. The National Highway work planned in Tamil Nadu, Kerala, West Bengal, Assam will further assist in the final goal of last-mile delivery and we are eager to see its results on our business. In the long term, all the expenditures could be assisted with the proposed introduction of the DFI which will speed up the infrastructure development in India.

Apart from this, the focus on the manufacturing sector in the budget would also help the logistics sector grow further”, said Mr. Aneel Gambhir – CFO, Blue Dart.

“The Union Budget 2021 was a balanced one with several encouraging proposals for the country’s real estate sector. For instance, the FM announced that more economic corridors are being planned to boost the development of roadways to improve inter- as well as intra-state connectivity. Plans were also announced to expand the metro coverage as part of additional budgetary allocation towards the development of infrastructure across India, with a special focus on developing Kochi Metro, Chennai Metro Phase 2, Bengaluru Phase 2A and B, Nashik and Nagpur Metros, among others. These proposals are bound to improve real estate projects in tier-2 and tier-3 regions by enabling a more seamless movement of people and resources to and from the urban centres” said Amit Agarwal – Co-Founder & CEO – NoBroker.com.

“As was expected, the Union Budget 2021 has focused on our nation’s growth and brings a very positive sentiment to facilitate the economic reset. While on one hand there is a generous allocation towards the continued fight against COVID and the vaccination drive; on the other side, there is a clear objective of reviving India’s GDP growth across all sectors, i.e. agriculture, manufacturing, and services.

This was seen in the major financial support announced for Farm produce, the PLI scheme of 1.95 Lac crores over 5 years, for boosting manufacturing and the opening of FDI in the Insurance industry up to 74%. The public infrastructure has got a strong boost with specific allocation for NHAI for continued vigour on highway construction and improvement of the roads; with specific budget allocation for some of the states, including Assam”, said Mr Dinesh Aggarwal, Joint Managing Director, Panasonic Life Solutions India Pvt. Ltd.

“We appreciate the government’s continued push towards digitization and strong infrastructure.  The focus on the development of roadways, dedicated freight corridor and airports will provide a great boost to the logistic sector enabling faster product movement across the country. The strong road and rail connectivity will also help in making e-commerce logistics more sustainable in smaller towns, leading to higher growth of the e-commerce sector. We are optimistic that the government’s focus on encouraging digital transactions and a strong push towards manufacturing in India, will boost the e-commerce growth in the long run.

The pandemic led to the acceleration of digitization across levels as online shopping became the new necessity and organizations were seen automating processes with technology solutions to bring in more efficiency. We are confident that upcoming e-commerce policy will provide further support to the industry and encourage MSME’s to join the e-commerce brand wagon”, Mr Kapil Makhija, CEO, Unicommerce.

“The Union Budget 2021 focuses on resetting the economy with a slew of measures to provide a leg up to the ailing real estate and construction industry. Infrastructure received a big boost with a proposed financial institution for financing big-ticket infrastructure projects.

Coupled with an enhanced outlay of ₹1,18,10 lakh crore for the ministry of road transport and highways, the government is clearly banking on large-scale infrastructure projects to kickstart the stalled construction industry”, said Mr Jayakumar Krishnaswamy, Managing Director, Nuvoco Vistas Corp. Ltd. 

“We welcome the Budget. The move to increase allocations for Roads & Highways Segment in the Infrastructure Sector will definitely facilitate the set development agenda. Road development has always been a proven strong Vaccine for an economic boost, since it has a direct impact on land prices, facilitate urban development, creates direct employment and immediate Capex generation above all. To overcome existing pandemic scenario this is inevitable and hence, well done”, said Mr Anil D. Yadav, Group Chief Finance Officer, IRB Infra Group.

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