The logistics industry will stand to benefit from the union government’s Rail Land licensing policy said India Ratings and Research (Ind-Ra) in a report.
It said the policy published on 7 September 2022, would provide a level playing field to private and public logistics entities, as well as encourage private participation in the development of logistics infrastructure in India.
“Through the policy, the government aims to eventually move to the competitive bidding process of allotment of railway land, which, so far, has been dominated by central/state agencies due to shorter leasing tenure and higher rental yields,” the rating agency said.
The policy would lead to increased participation from private players as well as help in reducing the overall logistics costs, it added.
India Ratings said that the existing licensees would not opt for the new policy for their strong and profitable terminals, which would eventually go for competitive bidding on the completion of the concession period.
However, the existing licenses for the unprofitable terminals are expected to be rescinded to avail the lower LLF of 1.5% under the new policy, it added.
