International cargo surges by 6.2%; Domestic cargo growth at 8.0%: ASSOCHAM
 Source : NewsBharati  Date : 04-Sep-2017

New Delhi, September 4: Domestic cargo has registered a growth of 8.0% at a compound annual growth rate (CAGR) during FY07-17, whereas international cargo grew at 6.2% annually during the same period, according to an ASSOCHAM-Yes Bank joint study.

In India, Air Trade to GDP ratio has doubled from 4% to 8% in the last twenty years. Air Cargo contributes about 20% of airlines revenue. Air Cargo industry involves a wide variety of service providers and employs nearly 70,000 thousand persons in the country, reveals the joint study on ‘Civil Aviation’ released.

Air Cargo should be treated at par with other Logistics sector like Roads which is subject to 5% tax rate. It is recommended that air cargo tax rate may be reduced from 18.0% and considered for a lower tax bracket.

Indian express cargo industry provides fast, reliable, on demand, integrated and door to door (including customs clearance and duty and tax payments) is likely to grow manifold in the coming years. The growth of the industry will be driven by the current major customer segments, namely auto components, banking & finance, garments, pharmaceuticals, IT hardware and mobile phones, e-commerce etc.

As per IMF forecast, GDP growth in India is forecast to grow at an average of 7.5 precent-8.2 percent during FY18-21 and thus Air Cargo could be at the centre of supply.

In order to provide scope of capacity addition to the existing cargo players, it is necessary to integrate airport infrastructure with air cargo facilities. Dedicated unused infrastructure at airports may be marked to air cargo operators.

With the introduction of GST, octroi has been removed, which will propel the demand for cargo movement through roads. Thus in order to protect Air Cargo from the negative impact emanating from the new developments in the competition sectors, it is recommended that a connectivity plan should be laid down to connect Rail Cargo with Air Cargo.