Union Road Transport and Highways Minister Nitin Gadkari urged the industry to refrain from repeatedly demanding tax cuts, emphasizing that the government requires revenue to fund welfare schemes for the poor. Speaking at a program, Gadkari stated that India’s logistics costs will be reduced to nine percent within two years, significantly boosting the nation’s global competitiveness.
Known for his straightforward approach, Gadkari stressed that continuous demands for reductions in Goods and Services Tax (GST) and other taxes create an unsustainable cycle. He remarked, “If we reduce taxes, you will ask for more, because this is human nature.”
Balancing Taxation and Welfare Initiatives
Gadkari highlighted the government’s responsibility to balance taxation and welfare initiatives, noting that while reducing the tax burden is desirable, taxes are essential for funding crucial public programs. He reiterated that the government follows a policy of taxing the wealthy to support the underprivileged, which places limitations on how much tax relief can be provided.
Currently, India’s logistics cost stands at 14 to 16 percent. Gadkari assured industry stakeholders that this cost will be brought down to nine percent within two years, thereby making Indian businesses more competitive in the international market.
Industry’s Role in Employment and Economic Growth
Lowering Costs Without Compromising Quality
Comparing logistics costs globally, China maintains an eight percent logistics cost, while the US and European countries operate at around 12 percent. Gadkari emphasized the need for Indian industries to reduce production costs without sacrificing quality to improve competitiveness.
Job Creation and Capital Investment
Gadkari also underscored the critical role of the industry in employment generation, stating that capital investment will drive job creation. He encouraged businesses to see themselves not only as wealth creators but also as employment generators, urging them to take advantage of India’s current economic growth phase.
Reducing Imports and Boosting Exports
To support India’s vision of becoming a developed nation, Gadkari emphasized the importance of reducing imports and increasing exports. Strengthening domestic manufacturing and improving infrastructure efficiency will be key drivers in achieving this goal.
