Steps in the right direction

With special thrust on infrastructure, the government has taken steps in the right direction. Although warehouses, cold storages and other storage facilities set up by sugar mills will not get any benefit from the government’s concessional import duty on mechanised handling systems, yet the decision will help set up additional storage facilities in the country.

The Union Budget 2010-11 provides a concessional import duty of 5 per cent for setting up mechanised handling systems and pallet-racking systems in “mandis” or warehouses for foodgrains and sugar, as well as full exemption from service tax for the installation and commissioning of such equipment. Independent warehousing companies, including the Food Corporation of India, are expected to benefit largely from warehousing incentives. Sugar mills do not take warehousing services from companies like FCI and hence, will not get any benefit from the government measures.