Pages: 40 ` 50/- CargoTalk.in ddppl.com Vol. XV Issue 4; March 2015 Postal Reg. No.: DL (ND)-11/6002/2013-14-15. WPP No.: U (C)-272/2013-15 for posting on 04th - 05th of same month at New Delhi P.S.O RNI No.: DELENG/2003/10642, Date of Publication: 03/03/2015 Port, customs authorities key to speed of business ....................................................08 MIHAN: A benchmark or a learning experience? ........................................................12 Realising the true potential of coastal shipping ..........................................................28 Cargo ‘alive & kicking’ With the opening of new routes, the specific and unique requirement for transportation of live animals has also increased. CARGOTALK finds out what hurdles a consignment of live animals entails, how these can be overcome and more. K ALPANA LOHUMI ew people understand the large logistics exercise involved in transporting animals. Logistics fraternity, however, knows that transporting animals needs a strategy and knowledge necessary to make the transportation safe and humane. In India, live animals are transported by via modes, ie air, rail and road. Over the last 15 years in the country, Live Animal logistics technology has advanced dramati- F said, “Today, the industry has no problem bringing Live Animals to a warehouse and delivering it within 24 hours. Export of hatching eggs and day-old chicks has increased for all parts of world out of India. Major movements out of India are for Gulf countries, African countries, Nepal and some of Fareast destinations.” He said increased inland air transport has helped to connect live animals shipment from different countries and opened new routes What LAR entails: more airports and air freight stations in hinterlands,” he said. • The International Air Transport Association (IATA) has specified global standards for transportation of live animals by air. The IATA Live Animals Regulations (LAR) is an essential guide in transporting animals by air in a safe, humane and cost-effective manner. Whether you are a shipper, a freight forwarder, an airline, or an animal care professional, the LAR is a must for transporting animals • • • Up-to-date airline and government requirements pertaining to the transport of live animals Requirements related to handling, marking and labeling Information about the necessary documentation needed when transporting live animals A comprehensive classification of animal species along with the container specifications required for their transport Pradeep Panicker Vipan Jain Chief Commercial Officer – AERO Delhi International Airport (P) Limited Regional manager – Logistics, South Asia & Middle East, Lufthansa Cargo cally. Manpreet Singh Dahri, Manager - Sales and Business Development, Namaste Aviation, for live animal logistics out of India. “India is slowing moving towards the top tier of live animal logisticsfriendly nations globally with • humanely and in compliance with airline regulations and animal welfare standards. Guidelines for the non-air transport of live animals and plants Cathay Pacific gives Kolkata 2nd freighter service Cathay Pacific Airways is introducing freighter service in Kolkata, boosting the city’s trade opportunities. From March 11, the freighter will carry goods into Kolkata late on Wednesday and Saturday and lift cargo on Thursday and Sunday. It will operate a Boeing 747-400 aircraft with a capacity of 100 tonne, but Kolkata’s share is likely to be 25 tonne because it will go to Delhi first. Cargo James Woodrow, Director, Cathay Pacific said, “India is a very important market for us. The new Kolkata service will boost the flow of garments and food products to and from India, taking advantage of our world-class facilities in Hong Kong to connect to our comprehensive global cargo network.” The cargo situation at Kolkata airport is not very bright with the state-of-the-art facility remaining largely unutilised. While there are some exports — primarily leather goods to Europe and the US and perishables like fresh vegetables, frozen fish and live crabs to Singapore, Taipei, Beijing and Shanghai — the import quantum is poor. Contd. on page 6 Railway Budget: Cargo sector looks for more CT BUREAU ailway Minister Suresh Prabhu, presented his outlay for railway freight sector in his maiden budget. The proposed investment plan in the Rail Budget for 2015-19 made provisions to facilitate connectivity to new and upcoming ports through PPP model. This has also been done R keeping in mind need for speedy work on critical coal connectivity lines to bring nearly 100 MT of incremental traffic to Railways and facilitate transportation of coal to power houses. To modernise operations government announced logistics parks and private freight terminals on PPP model. Provision has been made for special milk tanker trains in association with National Dairy Board and Amul to facilitate transportation of milk through rail and boost movement of fruit and vegetables in partnership with CRWC at 10 locations. Prabhu also assured close monitoring of Dedicated Freight Corridor Project (DFC) and implementation of Eastern and Western DFCs setting a target of nearly 1,000 kms of civil construction contracts. As per the Budget proposal, average speed of freight trains will be enhanced. Freight rates of cement, coal & coke, iron or steel & petroleum products have been raised, but salt has been exempted. Highlights: Plan to raise annual freight capacity to 1.5 billion tonnes Expected freight earnings: `1,05,770 cr Extension of logistics support to various E-commerce companies Paperless offices in Indian Railways in five years TECHNOLOGY Cathay Pacific App for cargo customers athay Pacific Airways has launched ‘Cathay Pacific’, a new cargo mobile application that offers cargo agents, forwarders and customers greater convenience when tracking shipments, through their smart phone or tablet device at any time and from anywhere. In addition to accessing information relevant to the operations of Cathay Pacific Cargo, customers can also review the e-booking status of their shipment by logging into the app. C MARCH 2015 CARGOTALK 3 Kale Logistics enters Iraq market he international air cargo management system of Kale Logistics, Galaxy, is now being actively used in the Iraqi ground-handler, Azmar Air. Based at Sulaymaniyah International Airport, Azmar will use the system for e-freight compliance, warehouse management and vehicle management, and it will be able to offer real-time updates to customers’ trade partners and EDI messaging. Galaxy is already in use by handlers including Bahrain Airport Services, Mumbai International Airport and leading international airports in India, plus Lusaka and Ndola in Zambia amongst others. T “We are now able to automatically collect all data, create better flight planning and arrange the operations in advance. Our customers including airlines, forwarders, GSAs are happy to see online updates and track shipments. More importantly, we attained this without having to increase our staff count,” said Indrajit Marath, General Manager, Azmar. ZIMonitor for sensitive Reefer Cargo IM integrated shipping services has launched a new monitoring, tracking and security services package called ZIMonitor, specifically designed for valuable and sensitive cargo stowed in reefer containers. The announcement of the launch was made at the Cool Chain & Temperature Controlled Logistics Europe conference in Frankfurt, where it was showcased between January 26th and 29th. Z The functions available include: • • • • • • Tracking of multiple air waybills through Track & Trace Saving airway bills in My Favourites Checking flight schedules and the latest arrival and departure times Checking shipment loadability Cathay Pacific office locations The latest news about Cathay Pacific Cargo The online monitoring service is also suited for other types of valuable or sensitive cargo such as for medical lab equipment; aviation products; perishable foodstuffs; wines and other alcoholic beverages; agriculture (seeds); electronics; art work and antiques; as well as hazardous or IMDG code goods. Some of the system features are: • The system has been successfully tested in an international pilot with a global pharmaceutical company. ZIMonitor is particularly suited for the Pharma industry, designed to comply with GDP regulations and provide ongoing data flow, alerts and automatic reports, along with a 24/7 professional response along the cargo route to prevent damages. • • • Online alerts to mobile and email, monitoring temperature, humidity, route deviation and unauthorized door opening 24/7 dedicated ZIM response team to prevent damages GDP compliance Predefined reports for logistical & operational analysis Reducing insurance costs #1 IN CIRCULATION & REPORT READERSHIP EDITORIAL Time to rise! he Indian air cargo industry is in a balanced upswing. After several years of stagnation, the air cargo business is growing again. Projections and initiatives suggest that the country has immense potential to position itself in the international market. However, this calls for collaborative efforts from everyone, be it stakeholders, freight forwarders, airlines or airport operators. The idea is to develop more Indian airports as international sky cargo hubs and upgrade them to international standard. T The Air Cargo Forum of India (ACFI) summit held in the capital also discussed the importance of designing airports as integrated multimodal hubs, so that they provide the best quality services. We need more than one multimodal international air cargo hub with state-of-the-art infrastructure to reduce logistics cost and dwell time. Dwell time is the cumulative result of various factors and Customs clearance plays crucial part in this regard. At the summit, officials from the Ministry of Civil Aviation (MoCA) assured the industry of cooperation from the government and asked the ACFI to focus on three problems such as congestion and dwell time, rather than push through a big wish list. In this issue, we have also focussed on the challenges and measures of coastal shipping. Despite its huge coastline and port connectivity, India is still lagging behind in exploiting the coastal cargo potential. On the other hand, the Jawaharlal Nehru Port Trust has also introduced paperless transactions at port gates. From airports to cargo hubs The Air Cargo Forum of India organised a seminar on ‘Transforming Indian Airports into International Cargo Hubs’ wherein key players gave their views on government, infrastructure and airline support for developing air cargo hubs. CT The initiatives which have been taken by the Air Cargo Forum of India (ACFI) for the development of air cargo industry in India is noticeable. I assure all the help and cooperation from the government. SanJeet Editor Harshal Ashar Deputy General Manager Rajiv Sharma National Head - Sales Kalpana Lohumi Abeer Ray Reporter Gaganpreet Kaur Sr. Marketing Co-ordinator Tushar Upadhyay Nityanand Misra Design Simran Kaur Photo Journalist U22210DL2012PTC230432 Renu Singh Parmar Union Minister of Civil Aviation, Government of India Economic Advisor, Ministry of Civil Aviation, Government of India We need some sort of efficiency and reduction in cost in order to make it successful. Indana Prabhakar Rao CEO, Delhi International Airport Private Limited It is necessary that the produce reaches its desired destination on time. Hence, air is the best mode of transportation and air freight has a significant importance. Airlines need innovative products with an objective of reducing cost. However, it’s not about creating more infrastructure, but to improve the efficiency and bring innovation. Rafeeque Ahmed Ashok Rana Circulation Manager Pradeep Panicker President, ACFI Airline support is necessary in the development of air cargo hubs, but they cannot work independently. We need to work strategically. From airline point of view, to develop hubs, infrastructure at the smaller airports has to be developed in tandem growth with the capacity. Sanjiv Kumar Executive Director – Cargo, Air India Infrastructure support is necessary for developing cargo hubs and here space is an important factor. We do have sufficient infrastructure but we need to change a way to measure things so as to use it efficiently. It’s a myth that India has lack of infrastructure, the need is to use the available infrastructure efficiently. ‘Make in India’ would never be successful if cargo is sitting outside. Thus, customs should play a role only when cargo is moving out of the terminal, thereby reducing the turnaround time. Chairman, ACFI, Bengaluru Chapter & CEO, Menzies Aviation Bobba Bangalore Anil Kharbanda Production Manager Here the question is how and what can be done to convert Indian airports into international sky cargo hub. An integrated multi-modal hub should include connectivity as well as accommodation and other services. It is essential that related sectors such as access to manufacture, business, and tourism and pilgrim centres are also developed. President, FIEO Venkata Reddy Vikas Mandotia Nitin Kumar Roohi Rais Advertisement Designer I would like to ask Air Cargo Forum of India (ACFI) to submit industry’s three important issues before MoCA for its active consideration. Three points would be way better than a wishlist. P Ashok Gajapathi Raju Sound infrastructure till the end point, rationalised policies and networking are three factors to make an efficient cargo hub. There is a need to make an end to end value chain. On these lines, there is an optimistic feeling in the Indian cargo and logistics SanJeet industry as the sector is getting Editor the desired attention from the government as well as the assurance that efforts are being put in to clear congestion and reducing dwell time. Gunjan Sabikhi Asst. Vice President BUREAU CARGOTALK is a publication of DDP Publications Private Limited. All information in CARGOTALK is derived from sources, which we consider reliable and a sincere effort is made to report accurate information. It is passed on to our readers without any responsibility on our part. The publisher regrets that he cannot accept liability for errors and omissions contained in this publication, however caused. Similarly, opinions/views expressed by third parties in abstract and/or in interviews are not necessarily shared by CARGOTALK. However, we wish to advice our readers that one or more recognized authorities may hold different views than those reported. Material used in this publication is intended for information purpose only. Readers are advised to seek specific advice before acting on information contained in this publication which is provided for general use and may not be appropriate for the readers’ particular circumstances. Contents of this publication are copyright. No part of CARGOTALK or any part of the contents thereof may be reproduced, stored in retrieval system or transmitted in any form without the permission of the publication in writing. The same rule applies when there is a copyright or the article is taken from another publication. An exemption is hereby granted for the extracts used for the purpose of fair review, provided two copies of the same publication are sent Tushar Jani Vice President, ACFI & Chairman, DCSC to us for our records. Publications reproducing material either CARGOTALK is printed, published and edited by SanJeet in part or in whole, without permission could face legal on behalf of Durga Das Publications Pvt. Ltd., printed at Cirrus Graphics Pvt. Ltd., B-62/14, Phase II, Naraina action. The publisher assumes no responsibility for returning any material solicited or unsolicited nor is he responsible for Industrial Area, New Delhi - 110 028 and published at 72, Todarmal Road, New Delhi - 110 001 material lost or damaged. This publication is not meant to Tel.: +91 11 41669575, 41669576 ; Fax: +91 11 41669577 be an endorsement of any specific product or services E-mail: cargotalk@ddppl.com, Website: www.cargotalk.in offered. The publisher reserves the right to refuse, withdraw, MUMBAI: amend or otherwise deal with all advertisements without 504, Marine Chambers, 43, New Marine Lines, Opp. SNDT College, explanation. All advertisements must comply with the Indian Mumbai - 400 020, India, Ph.: +91-22-22070129; 22070130 and International Advertisements Code. The publisher will MIDDLE EAST: not be liable for any damage or loss caused by delayed pub- Durga Das Publications Middle East (FZE); Z1-02, PO Box: 9348, Saif Zone, Sharjah, UAE; Ph.:+971-6-5528954, Fax: +971-6-5528956 lication, error or failure of an advertisement to appear. AIRPORT MARCH 2015 CARGOTALK 5 MIAL rated e-freight compliant by IATA Mumbai International Airport Limited has been rated e-freight compliant by IATA after it successfully achieved its initiative aim at minimising and subsequently eliminating the vast quantities of paper documents needed for its air cargo operations in Mumbai. CT BUREAU VK-Mumbai International Airport Limited (GVK MIAL) has been rated as e-freight compliant by the International Air Transport Association (IATA) for adopting paperless initiatives at the air cargo operations in Mumbai an initiative aimed to minimise the vast quantities of paper documents the air cargo industry relies on to support movement of air freight. G Manoj Singh Vice President and Head (Cargo) - MIAL AISATS accredited with IATA’s ISAGO certification Air India SATS Airport Services (AISATS) received the IATA Safety Audit for Ground Operations (ISAGO) certification for adhering to IATA’s stringent and high safety standards at The Rajiv Gandhi International Airport, Hyderabad as well as their headquarters at Mumbai. The certification ensures safer ground operations, fewer accidents and injuries, uniform audit processes, eliminates redundant audits and effectively improves quality standards. Key parameters like Organisation and Management (ORM), Load Control (LOD), Passenger and Baggage Handling (PAB), Aircraft Handling and Loading (HDL) and Aircraft Ground Movement (AGM) were taken into account by IATA while certifying AISATS. Willy Ko, CEO, AISATS said, “This is just the start of our journey. Our other business units are working on achieving this certification too. ” The e-freight compliance by GVK MIAL involves air carriers, ground handlers, shippers, customs authorities and freight forwarders to effectively streamline processes, cut costs and improve speed and reliability. This has resulted in expeditious processing, quality improvement and substantial time savings in cargo operations. The initiative will help in eliminating the use of paper documents. “We would like to thank the entire trade fraternity for making this globally accepted industrywide initiative a great success at Mumbai and our technology partner Kale Logistics and stakeholders Lufthansa Cargo, Freight Wings and Khimji Poonja for official participation in the e-freight audit process,” said Manoj Singh, Vice President and Head (Cargo) - MIAL. 6 COVERSTORY CARGOTALK M A R C H 2 0 1 5 Smooth and safe transit for animals Contd. from page 1 Talking about the requirements for transportation of live animals, Pradeep Panicker, Chief Commercial Officer – AERO, Delhi International Airport (P) Limited, said, “Air transportation of live animal is more organised and is governed by IATA’s Live Animal Regulations, under proviso of which airlines book, handle and uplift. The animals can be carried either through passenger terminal on payment of applicable charges or they can be booked in cargo terminal.” “Few airlines even allow speci- are spreading the awareness on pet relocation.” • The IGI Airport has recently opened a helpdesk to ensure a friendly journey for pets, taking care of formalities including quarantine, passport, Custom clearance, travel (domestic and international), flight booking, pick, drop, inspection and consultation. The Help Desk also provides physical handling of the pet during check-in at airline counter and facilitates security. Talking about the current scenario of live animals logistics industry in India, Vipan Jain, Regional manager – Logistics, South Asia & Middle East, Lufthansa Cargo, said, ‘The live animal industry in India is still quite limited. The business is more related to expiates moving with their families in India and getting with them their pets such as cats and dogs. Hence, there is a minor increase of pet movement in the recent years.” Corresponding to this increase, Jain said, “There is also an increase of professional touch and specialised people in this sector who Cathay Pacific Airways recently uplifted a shipment of five horses from Mumbai to Colombo Manpreet Singh Dahri Manager, Sales and Business Development, Namaste Aviation “A major challenge is correct documentation related to various country regulations pertaining to Anand Yedery fied type of pets in the passenger cabin. Cargo terminals at the airport generally have dedicated area for handling of the live animals,” he added. Animals on the move: imports as well as exports of pets. At some airports like CCU, live cargo movements are mostly constrained up to live crabs to Far East and on very few instances, live pets are handled for both import and exports. Anand Yedery, Regional Cargo Manager – South Asia, Middle East & Africa, Cathay Pacific Airways said, “The infrastructure at some airports or cargo terminals is a challenge.” Regional Cargo Manager – South Asia, Middle East & Africa, Cathay Pacific Airways at the international and domestic airports in comparison to western countries.” What is required to make animal logistics easier? According to Panicker, the pet has to be carried in kennel of appropriate size and strength having arrangements of food and water and proper locking arrangements to prevent its escape. Handling and carriage under proper ambient temperature as well as oxygen supply should not be ignored at any cost. “During air carriage, a pet may face Challenges ahead Despite various developments with regard to animal transportation, there are several challenges yet to be addressed. Only six airports in India have animal quarantine facility and can handle complete Process of transporting live animals: The shipper has to carry the record certified by a veterinarian claiming the animals is physically fit to fly and NOC from wild life department. During the flight, the pet is required to be placed on an IATA specified packing ensuring to give it enough space to turn about normally while standing and to lie. There are more 20 regulatory processes involved in global live animal movement. 67 showjumping horses were transported on Qatar Airways Cargo freighters from Liège, Belgium to Doha in November 2014 Hong Kong Air Cargo Terminal Limited (HACTL) has handled 62 showjumping horses by carrier Emirates SkyCargo Live animal cargo movement at IGI Airport Year Export Import 2013-14 274 106 2014-15 174 86 (Figures reflect number of live animals) Growth factors Dr S K Choudhary, Director (PetFly) Veterinarian & International Pet Travel Expert, said, “Now a day’s pet owners are concerned about their pet's well being and safety during the travel. Thus, the industry is still learning and evolving with latest trends and equipments for pet's safety and comfort.” “People moving back to India on transfer of residence are entitled to get a maximum of two pets,” Jain said. followed for import and export in the respective country By following simple tips provided by expert veterinarian and pet travel consultants Dr S K Choudhary Director, (PetFly) Veterinarian & International Pet Travel Expert health checks and the necessary approvals from the government or designated veterinarian before the commencement of the journey,” Jain said, adding, “The shipper must check for the requirement before sending their animals to and from other countries.” When asked about challenges you face while transporting live animals, Choudhary said, “Pet friendly cabs are difficult to find and airport staff is also not pet friendly. Facilities for pets are still lacking by far longer duration of air travel with intervening transit halt at an airport too. The concerned airline should take care of its all needs such as walking, freshening, refilling of food and water bowls and also medical needs, if required,” he said. Choudhary listed thefollowing points that should be considered before relocating animals to domestic and foreign cities: • Utmost safety and comfort • Creating awareness about travel of pets, which is now becoming a general trend • Informing pet owners about the rules and regulations to be However, there are several factors that can drive growth in this sector. The transportation has become more user friendly with few companies providing exclusive facilities to transport pets. According to Jain, modern infrastructure, separate animal clearance terminal or lounge, more trained professionals in industry and more transparency and electronic mode of various permissions will facilitate the customers and drive growth in this sector. “Growth in this sector cannot be created however a combination of simplified process, better facility and events like the Derby, dog shows, etc can drive further growth in this sector,” Yedrey said. “Establishment of proper care and handling facilities at the airport for departing, arriving and transiting animals and simpler regulatory clearances can alsoadd to the growth,” Panicker added. 8 INTERVIEW CARGOTALK M A R C H 2 0 1 5 Port, customs authorities key to speed of business Speed of customs and port operations is critical in deciding the pace of imports and exports as any delays tend to have a ripple effect. Talking about the speed of port operations in an interview with CARGOTALK Vishwapati Trivedi, Chairman, National Shipping Board says while bigger ships mean better business Indian ports have limited capacities. conditions. Since private ports do not have to go through too many procedures, they have been quick in evacuating cargo and hence they has been a shift of cargo from public ports to private ports. A BEER R AY Public ports have not been able to perform Q as well as the private ports. What factors would account for that? The major ports, have in the last one-and-a-half years, been progressing pretty well and because the averaging is done, some ports have done very well, while some have not been able to. So the averaging gives the impression that these ports are not doing as well as the private ports, but some of them are doing very well. JNPT has been asked to introduce ‘paperless’ gate-in operation to ease gate delays. What are your views? Q Vishwapati Trivedi Chairman National Shipping Board There has been a shift of cargo from Q public ports to private private train operators can also come into the picture. The Prime Minister has stressed on Q port-led development. What are the steps being taken to achieve progress in this regard? JNPT, in fact, has in the last two or three months been asked to operate at a paperless level. The Ministry had planned to use it as a ‘proof of concept’ and replicate it to all other major ports. Though they have done something, there is an issue of digitising the entire transaction. JNPT The Prime Minister is not only worried about the ports; he has tied it up with the development of hinterland of the ports. Gujarat has 41 ports, but they all have some anchor industry to cater to and they are all doing well. For example, when the PM took charge and floated the idea of port-led development, the Ministry also took note and got the SEZ sanctioned just behind JNPT. That is going to be a big industrial township was advised to go for an electronic gate pass instead of a physical gate pass. Though JNPT is working on that but they need a lot of cooperation from the customs. itself, which is there because of the port; so that’s port-led development. The new concept of port-led development at the hinterland will itself generate much cargo. The Ministry has been thinking of Q connecting ports with Does the government have any plans to Q develop coastal shipping railways. Has there been any development in this regard? for movement of cargo? a suspicion, they can always check. So the concept of ‘Green Channels’ was established at many ports, but not all. Now as shifting of cargo through coastal movements is a big challenge; the government has brought forward an incentive to promote the same in the form of a subsidy scheme to shift cargo from rail / road to the coastal route. What are the current plans of the Q government regarding development of ports? The GDP of the country is surging due to renewed investor confidence in the country. The projected cargo as per Rakesh Mohan Committee is already obsolete. The cargo profile ports. Why is that? In the cargo sector, there is always, as they say, 95 per cent by volume and 70 per cent by value. As the GDP of the country goes up and as we exert more and more of our choices and import and export to meet our needs, the total throughput cargo is definitely going to go up. Some ports have developed very smooth systems of doing logistics, while there are others which have tried very hard but have not yet been developed. The non-major ports have been able to do a far better clearance of cargo in terms of time. In the major ports sector, some ports have done a great job. For example, JNPT has done very well in terms of efficiency of evacuation, though there are some issues in clearing it to the hinterland. Exports are fast because export is not so much subject to scrutiny and paperwork; imports get stuck. The two critical operators in the fast clearing of imports are the port guys and the customs authorities. Due to the customs authorities being slow in clearing processes there is a problem, for example, trucks do not move out fast, the storage capacity at the port is not evacuated or cleared fast due to which the new stuff cannot be dumped again. Also in the ports on the East side, there has been a large spurt in the last four months in imported coal due to various reasons. The power plants are also under pressure to increase their plant load factors and capacities and they have been using a lot of imported coal that mostly comes from Australia, Indonesia or lands on the East coast. All those ports are choked to capacity and bigger the ship that comes more is the efficiency in terms of pricing and costing. But our capacity to dock big ships is also limited. The government has been trying to build up extra space for offloading. Imported coal spurt is very periodic and so people operating at the ports are a bit reluctant in putting permanent infrastructure to import so much as it is difficult to put a structure which will serve for 30 years for a demand which is expected to last only five years. Our ports have to make do with the current capacities and gear them for at least for five to six years according to the needs. In the major ports, there is not too much flexibility because they have to go through procedures as everything is subject to some regulatory Some months back, the Ministry of Shipping moved a note to have a port railway company which will connect ports or construct railway lines connecting the same to the main trunk route or even buy or lease some rakes. Also since they are basically targeting coal, once this company is established the monopoly over coal by the railways is the first issue that would be discussed and the monopoly of the Railways may be threatened and then the Talking about coastal cargo, it has immense potential; in the US it is called short sea cargo. All these ports are in a custom bond area and there are transaction costs along with other formalities that pose minor obstacles. So the government has thought of bringing coastal jetties outside the customs bond area, but since that takes time the government has floated a scheme for all those ports who wanted to invest in coastal shipping in the form of ‘Green Channels’. The coastal cargo is brought and sent through the Green Channel. If the customs have will be far beyond what he has projected. So the Ministry, in fact, is now using that extra bullish c argo growth to decide the port capacities rather than what was set earlier. The Ministry is already planning along these lines and a lot of such projects are in pipeline, but the same cannot be applied to all ports. Port capacities will need to be increased, made efficient and calibrated in a manner that typical cargo goes to these ports. Every port cannot have every kind of cargo. As we do not have big ports as JNPT on the East coast, so the government is planning to build a big port in Dubrajpur. Several new small ports are coming up; we have a great country which has huge potential and the current emphasis on ports as infrastructure is being given high importance. The latest in line is the Sagarmala Project which the Prime Minister has defined as port-led development. 10 INTERNATIONAL CARGOTALK M A R C H 2 0 1 5 IATA takes World Cargo Symposium to China With ‘Improving the Customer Experience’ as its theme, IATA is looking to harness the creative brilliance in the air cargo industry. With the event taking place in Shanghai IATA will also get a chance to work closely with the Chinese air cargo community. CT BUREAU Are you optimistic Q about the air cargo business in 2015? I am optimistic on volumes but getting revenues back is still proving hard. After several years in the doldrums, the cargo volumes expand strongly in 2014 with 51.3 million tones. But the revenue, at $62 billion, is still $5 billion less than the peak year in 2011. So we are working harder to deliver more, but earning less for it, which is not an enviable business model. The changing freight environment is something we all have been aware of for some time now. Nearshoring, trade protectionism, and competition from other modes are trends that are not going to go away any time soon. So the industry needs to be ready and adjust to the new reality. What is the thinking behind this year’s Q WCS theme of ‘Improving What are you most looking forward to at Q the WCS? the Customer Experience’? What are the main Q reasons for bringing the 9th World Cargo Shippers are demanding a much higher-quality service, and the air cargo industry is evolving to match those expectations. We are seeing more and more complex time and temperature-sensitive shipments, dangerous goods that must be handled with great care or vulnerable commodities that must be moved with speed and discretion. Therefore, as the user demand becomes more sophisticated, air cargo facilities and processes are adapting. We are no longer about speed, quality control is crucial. There’s always a lot to enjoy and plenty of thought-provoking discussion at WCS. We always get some fascinating key speakers, and the discussion tracks often illuminate a challenge, new trend, or best practice. Symposium (WCS) to China? It is exciting to be coming to Shanghai. We all know about China’s export strength, but its import market is becoming no less important. China is going to move an extra one million tonnes of cargo a year by 2018. However, this will generate some sig- nificant quality, reliability and security challenges and we want to work closely with the Chinese air cargo community and regulators to help them smoothly leap those hurdles. Glyn Hughes Global Head IATA But we need to go further in understanding our customer’s needs. That’s why, as part of our preparations for WCS, we are conducting our first shipper survey for at least five years. We want to know why shippers use air cargo and what their experiences are, and then only we will be in a better position to improve their experience. US port strike hits exports But this year I am particularly excited by the first ever Air Cargo Innovation Awards. IATA is looking to harness the creative brilliance in the air cargo industry by offering seed investment up to $20,000 for an idea that increases the quality or decreases the cost of operations, increases revenue or optimizes capacity. $10,000 will also be available for two runners-up. The winners will be voted by the WCS delegates at the closing plenary, from a shortlist judged by an independent panel of industry experts. It should be a fascinating and uplifting finish to what promises to be a really excellent and memorable WCS. Another freighter to Burkina Faso, Africa As India’s key exports suffer due to the shutdown at the US West Coast ports, exporters talk about the various challenges that they Emirates SkyCargo has added the capital have to face because of the strike by the port workers and the impact city of Ouagadougou in Burkina Faso, it would have on the trade relations between the two countries. Africa to its existing list of destinations. CT The existing port shutdown, triggered by a bitter dispute, is a cause of concern for Indian exporters. BUREAU he long-standing dispute on the US West Coast between International Longshoremen and members of the Warehouse Union has stalled the export of products and items from India to various countries. The strike that has been on for over two months has lead to ports becoming congested and goods from vessels not being unloaded for further transhipment to other countries. As there is an imminent fear of the ports being shut down, exporters from India are facing losses due to port delays as a result of which the supply chains between the US importers and Indian exporters have been badly hit. T US is an important market for Indian chemical products as it Satish Wagh Vice Chairman CHEMEXCIL accounts for around 11.6 per cent (USD 1.523Bn) of total exports falling under the purview of the Basic Chemicals, Pharmaceuticals & Cosmetics Export Promotion Council (CHEMEXCIL). “The slowdown will hinder the ability of US importers to meet end-user requirements. Besides, the delays in ports will also lead to piling up of demurrage and detention charges which will hurt margins and competitiv ness. If this stalemate continues, it might adversely impact flow of repeat export orders for Indian exporters. Since India and US are currently strengthening their partnership in various fields at the leadership level. Therefore, it is in the interest of Indian exporters that an agreement between shipping companies and dockworkers is arrived and the situation is normalised,” said Satish Wagh, Vice Chairman, CHEMEXCIL CT BUREAU he capital city of Ouagadougou in Burkina Faso, Africa, has been added to Emirates SkyCargo's destinations, becoming the airline’s 27th destination in the T continent. The new route begins in Dubai with stops in Ouagadougou, Dakar and Frankfurt before returning to Dubai. The 777F aircraft being operated on the route can carry 103 tonnes of cargo. With a range at maximum payload of almost 5,000 nautical miles, the aircraft easily covers the nonstop 10-hour sector lengths. The flight will leave Dubai every Tuesday morning at 9 am and return the next morning. Emirates will bring imports to Burkina Faso, such as pharmaceuticals and electronics from Asia and return to Frankfurt and Dubai with local Burkina Faso products such as fresh mangoes and beans. “We offer thousands of tonnes of capacity each week on our routes into Africa and the new scheduled freight service to Ouagadougou will take Emirates SkyCargo's import capacity to Africa to 3,700 tonnes per week,” said Nabil Sultan, Divisional Senior Vice President Emirates SkyCargo. 12 DEBATE CARGOTALK M A R C H 2 0 1 5 MIHAN: Is it a benchmark Multimodal International Cargo Hub and Airport at Nagpur (MIHAN) was conceptualised as a logistics project with the Special Economic Zone (SEZ) as a supportive facility. The project has been path breaking and first-ofits kind. However, it has also struggled with bottlenecks to find a footing since its inception in 2008. CARGOTALK tries to explore if this project served as a learning experience for others or if it has set a new benchmark. K ALPANA LOHUMI Sanjiv Kumar, Executive Director-Cargo, Air India The initiative to develop Nagpur as Multi Modal International Cargo Hub (Mihan) at Nagpur is a promising start for Indian Airports to develop as multimodal cargo hubs with integrated road and rail connectivity as also a developed industrial and services pockets nearby to cater to the hub. One of the key features is to have a viable model which would take into account the cost of investment and development of the multimodal cargo hub. The first step has been taken and all action needs to be taken for making MIHAN a success story before venturing into developing new multimodal cargo hubs. The challenge is to ensure the success of Multimodal International Cargo Hub and Airport at Nagpur (MIHAN) and replicate the experience derived from this site in one or two more airports in the country. Out of the airports to be selected for such a project, at least one should preferably offer sea connectivity. Tulsi Mirchandaney, Managing Director, Blue Dart Aviation So far, we have no evidence to corroborate the viability of Nagpur as a model for a hub, but I do agree that multimodal connectivity is one of the key imperatives for a competitive hub in India. Successful hubs like Dubai and Singapore are useful benchmarks, but India is uniquely positioned because of its geographical size and demand, and the opportunity for domestic distribution as well as manufacturing for exports are immense, with our attributes and potential more comparable with China and the USA. However, we first need to set right our operating environment for air cargo transportation. Air Cargo and Air Express need to achieve for India what mobile communication has accomplished for the country – connecting every citizen. This will provide the momentum for growth. High quality services delivered at competitive rates and policies to attract investment into our segment of aviation are vital. Our policy of 74 per cent FDI in cargo airlines is a non-starter because it still inhibits international operations, whereas foreign airlines are free to operate into India under the Open Sky Policy of 1992, giving them an unfair advantage over an Indian carrier. Finally, it is important to recognise that cargo airlines must co-exist with business and commerce, and cannot be relegated to isolated airports. Cargo airlines provide the essential connectivity for economic development and are essential at major airports. A separate policy within the framework of the Civil Aviation Policy must be framed for cargo airlines to include FDI, allocation of airport infrastructure and facilities, the regulation of tariff for such essential infrastructure, and service levels of key performance indicators at airports. There have to be compelling reasons for airline to shift from their current preferred hubs to the new hubs in India. Multi-modal connectivity in itself is not a sufficiently compelling reason. It is essential to grow the domestic and international distribution strength of the country. highlights: The initiative to develop Nag International Cargo Hub (MIHApur as Multi Modal promising start for Indian Air N) at Nagpur is a ports to develop as multimodal cargo hubs It’s time to repeat the MIHAN pro airport with sea connectivity pre ject in one or more ferably Multimodal cargo hub s are a need of the hour especially in India due to severe infrastruc ture constraints at existing airports However, Cargo hubs can be create only if infrastructure is developed d but it will develop simultaneously Air Cargo and Air Express need to achieve for India what mobile communication has acc country, i.e. connecting every citi omplished for the zen Multi-modal connectivi ty in itself is not a sufficiently convincing reason, there has to be for airlines to shift from their cura undeniable reasons and their comfort zones to the newrent preferred hubs hubs in India The Hub airports sho uld have manufacturing centres nearby for feeding these hubs wit h airfreight for export and import value additions These hub airports sho uld also be rail and road connections for a well connected with smooth multimodal transportation DEBATE MARCH 2015 CARGOTALK 13 or a learning experience? KS Kunwar, Director General, Air Cargo Forum of India Nagpur MIHAN project has not picked up since its establishment by the Government of Maharashtra because neither it’s near the manufacturing areas nor well connected with international air routes of leading airlines as well as domestic carriers. When it comes to establishing a multimodal air cargo hub following ingredients are must to consider;- • Such airports should have well established air connectivity with many international foreign airports/cities as well as with many domestic airports/cities with the help of international airline operations and national carriers to reach as many as national airports. It should also have nearby satellite airports to perform hubs and spokes. • The Hub airports should have manufacturing centres nearby for feeding these hubs with airfreight for export and import value additions. • Hub Airports should also prove to be international transhipment hubs with shortest dwell time fastest connectivity. • These hub airports should also be well connected with rail and road connections for a smooth multimodal transportation. • The success of a Hub airport lies with a simplified processes duly supported by a well established Cargo Community System for online transaction. I suggest Delhi, Mumbai, Chennai, Kolkata, Hyderabad and Bengaluru airports should be considered for developing multimodal international cargo hubs in India. Government is also considering on the above similar lines. Ravinder Katyal, Director, UTi Creating more Indian airports as multimodal cargo hubs is the need of the hour. The Nagpur MIHAN initiative will help improving the operational excellence, better control, cost control and will de-congest the main airport terminals. Consolidation is the way forward concept and multimodal cargo hubs will help. I suggest this initiative should be considered across all the industrial hubs and cities in India. Sujeen Paulose, Director Commercial, Hercules Aviation Cargo hubs have to be increased in India but we should study why OZHAR Nasik failed. The whole airport was very close to BOM and HYD but due to limited infrastructure, less confidence of the exporter, non realisation of drawbacks to exporter, non bonding facility between major airports, exports good allowed out of BOM under bond which led to the failure. We can create Cargo hubs but it will develop only if infrastructure is developed simultaneously. All agencies have to come together and make this happen. We should not make polices which will only develop some airports and only grow them as they have been privatised. Right now, all policies is being made in overview of creating more and more traffic to airports which are already busy and not even have space to cater. Huned Gandhi, Managing Director India, DACHSER India Multimodal cargo hubs are a need of the hour especially in India due to severe infrastructure constraints at existing airports and the shipments are having to spend a lot of time in transit from the shipper's location to the gateway airports and vice versa. This is also leading to additional cost which is highly unproductive for the industry. MIHAN is a very interesting project and has several unparalleled advantages like strategic location i.e. Central India, excellent infrastructure i.e. manufacturing facilities, SEZ's to name a few. Also the government has directed the state-run Central Warehousing Corporation (CWC) to set up air-freight stations in 10 cities which I believe, is a great initiative towards expeditious handling of airfreight shipments. Another important area is to de-congest the roads leading to and from the cargo terminals to reduce the lay time of trucks waiting to load/unload import and export cargo. Here, infrastructure will play a major role in India's development and this is where the industry needs specific attention. Sandeep Pingle, Country Manager, Rhenus Logistics India MIHAN as a concept was excellent and the aim to exploit the central location of Nagpur and convert the present airport into a major cargo hub with integrated road and rail connectivity was very promising. The idea was to make Nagpur an international air cargo hub, with aircraft flying across the globe stopping here for refueling, while the cargo got redistributed. With long haul flights now being available, the need of stopping midway does not arise. Still, Nagpur due to its central location can become a domestic multi modal cargo hub. Unfortunately since 2008, this project has been mired into numerous controversies and is not making headway in terms of its completion. It would be good to develop the existing international airports at Delhi and the New International airport at Mumbai as the cargo hubs due to proximity to the industrial/commercial hubs, port and advantage of carriers already operating from these airports. Raajeev A Bhatnagar, Chairman, UFMI India would need more than one Nagpur and the reason for this is our geography and multiple airports and ports we operate from. So creating only one hub at Nagpur is not an answer, other places to consider could be one down south and one in either Eastern or Northern corridor. More than creating a Cargo Hub, what is important is an efficient connectivity between the cities, airports and ports for smooth movement. Currently our infrastructure, that is in terms of road or rail transportation is not at its best, for example it still takes three days for cargo to move from Delhi ICD to Nheva Sheva by road, and this can be improved upon by improving the road infrastructure, single point of entry and exit, reduction in paper work, and then efficient handling at the airport or port. By building the world class infrastructure we would be able to reduce the cost of logistics which currently is the highest in India. 14 FAMILYALBUM CARGOTALK M A R C H 2 0 1 5 PHD outlines the needs of Indian air cargo sector PHD Chamber of Commerce recently organised a PHD-GMR Aviation 2015 Summit with the aim to discuss new regulations and policies so as to address the key challenges of the aviation sector. The conference saw a discussion on guidelines and suggestions by the industry on setting up Air Freight stations (AFSs) across the country. Efficient Cold Chain: Lifeline of perishables The one-day conference on Cold Chain organised by the PHD Chamber of Commerce & Industry saw a discussion on the challenges facing the sector. The participants discussed the need for latest technologies, trained manpower and upgradation of infrastructure facilities such as roads and power so as to meet the demand of food in the country. 16 GUESTCOLUMN CARGOTALK M A R C H 2 0 1 5 A portly challenge: Questioning the benchmark It is time to question the old parameters instead of blindly following on the line of ‘Emperor’s New Clothes’, notes Mihir Das, Independent Port Consultant and faculty member, CEPT University. He argues that it is not possible to advise a common benchmark for all ports as uniform expressions of performance do not address the same requirements for individual ports. EOs of outstanding service organisations spend little time simply setting profit goals or focusing on market share, which had been, the management mantra of the 1970s and 1980s. Instead, they understand that in the new economics of service frontline workers and customers need to be the centre of management concern. ues on ‘soft’ measures thus, establishing relationships between profitability, customer loyalty, employee satisfaction, loyalty and productivity. C Ports are now a very large part of the Indian infrastructure with Rs 2.77 lakh crores set aside for the 12th plan and an expected EXIM traffic in the range of three billion tonnes by 2020. Thus, building and managing the existing and added infrastructure, no doubt, remains a daunting task. The port competition has reached a fever pitch and thus the effectiveness – process modification or re-engineering has to be put in priority arena – in addition to the right kind of performance measurement practices. Ports nurture a paradigm of following indicators suggested by UNCTAD about two decades ago. They have evolved and now undertake ship related industrial and commercial services in its ambit of cargo loading, discharging, storage and navigational services, thus, directly a part of supply chain management influencing logistics We can examine the berth occupancy, pre-berthing detention, turnaround time, ship day output, yearly berth utilisation, total throughput, berth-day output, crane utilisation, ROI/RONA and so on. All these indicate different pictures for different ports. and distribution services and positively impacting control. Time has come to question these measures instead of blindly following the above parameters on the line of ‘Emperor’s New Clothes’. In most cases, it is not possible to advise a common benchmark that is applicable to all ports as uniform expressions of port performance do not address the same requirements for individual ports. Careful identification of problems to be monitored and main characteristics of the commercial activity might lead to more accurate indicators and targets that help stakeholders also to judge performance. The other ‘Catch 22’ situation faced by the ports is that the needs of the ship owners (including their agents and freight forwarders) are not aligned to those of the shippers or the cargo owners. The service-profit chain, developed from analyses of successful service organisations, puts ‘hard’ val- A port having a very efficient ore loading capability and handling only ore will be in an advantageous position to highlight the yearly throughput as the efforts are minimal being a mechanised unit. But throughput of ports, which perforce need to handle break bulk commodities in large numbers, needing lots of efforts and resources may not be glorious. Older ships in mid-sized ports lie for longer periods for surveys and repairs yielding greater berth occupancy bearing a positive appeal to the port-finance team. On the other hand, the ports having capacity to handle larger vessels find their berths less occupied; much to the dismay of the auditors. Sustainable ports will measure performance in order to monitor and control, drive improvement, ‘Paperless’ gate-in by JNPT maximise the effectiveness of the improvement effort, achieve alignment with organisational goals and objectives and reward and align customers. Indian ports are also entities operating in an extremely complex and competitive environment wherein measuring, monitoring, controlling and improving port performance are key elements of port competitiveness. Assessing port performance is a rather complicated and multileveled task. That might be a core explanation behind the observed gap in a holistic approach in Ports Performance Measurement (PPM) that would be in line with BMP. Mihir Das Independent Port Consultant and faculty member CEPT University DHL to connect Tuticorin with Hamburg As part of an initiative to introduce faster turnaround improvements and potentially cut dwell time for the truckers waiting outside the ports, JNPT DHL Global Forwarding is expanding its services has been instructed by the Ministry of Shipping to introduce paperless connecting India and Germany by means of a gate-in or paperless customs documentation program. newly launched weekly container service. CT B UREAU awaharlal Nehru Port Trust (JNPT) has been asked by the Ministry of Shipping to operate at a paperless level. The move is being aimed as a move to ease businesses aimed at accelerating growth. The port officials have been instructed to simplify the procedures and documentation presently being followed in exports. J The Ministry had planned to use it as a ‘proof of concept’ and replicate it to all other major ports. Though the JNPT is working on the same, there is an issue of digitising the entire transaction. JNPT has been advised to go for an electronic gate pass instead of a physical gate pass. Significance: Introduction of electronic gate pass This program will be used as ‘proof of concept’ for all other major ports CT B UREAU HL Global Forwarding is launching a new weekly direct service for container cargoes between India and Germany. The new service will reduce the transit time for LCL transports from Tuticorin to Hamburg from 33 to 26 days. D “Germany is India’s number one EU trade partner. The launch of this new LCL route connecting Tuticorin to Hamburg will further facilitate foreign trade between the two countries and support the growing needs of small and medium enterprises. This will be particularly beneficial to companies in the textile, chemical, metal, leather and electronics sectors,” said Samar Nath, CEO, DHL Global Forwarding India. DHL Global Forwarding is expanding its LCL network. From Asia alone, consolidations are being moved from 45 terminals to 56 European container freight stations every week. Key points: It will further facilitate foreign trade between India and Germany The new service will reduce transit time 18 INTERVIEW CARGOTALK M A R C H 2 0 1 5 ‘Optimise with asset light & heavy models’ One of India’s leading supply chain solution providers, LCL Logistix has made its presence felt across not only the entire country but also across continents. Arup Chatterjee, Managing Director, LCL Logistix discusses the nuances of the logistics sector, the unique capabilities of the company and suggests models that can create scope for optimisation. CT B UREAU What are the strategic investments Q made by LCL Logistix to improve efficiency in the supply chain process? We are an integrated service provider with presence across the value chain of logistics and supply chain management solutions. LCL Logistix has finished its capital expenditure cycle pertaining towards its strategic investments, e.g., expansion of the existing fleet across the length and breadth of the country for its surface transportation, CFS in Gujarat, West and East of the country. We have open bonded, nonbonded warehouse facilities in South, East and West of India. LCL Logistix will focus on growth, and will invest in Indian and overseas markets as and when opportunities arise. What strategies do you suggest to the Q existing LSPs to evolve and reinvent the supply chain process needed to achieve a leading position in the industry? The abstract of logistics being a sunrise sector and India possessing strong macro-economic fundamentals cannot simply overcast that globalisation brings massive opportunities and enormous challenges; that too when the sector is not structured enough and scattered into handful of standalone value chains. Hence, today's LSPs should be firm in adopting international best practices, standard operating measures and dynamism though flexible action plans at every service offered. An asset light model with an asset heavy business model should be looked at as a combination which can give plenty of scope for re-shuffling, optimisation of revenue structure, etc. Applications of modern IT and system platforms/modules should be adopted. What are the different trends currently in Q the logistics sector? Indeed there is a sector consolidation happening, although at a slow pace and logistics as a term being widely known today. The sector is attracting investments hereby footing up their growing ambitions, equity dilution is rolling on; perhaps it could be an infliction point for this sector. The long drawn cost of talent crunch pertaining to this sector is also washing out slowly; young minds are willingly upholding the logistics careers, probably not in the mainstream but still there is a change. The Indian coastal water deserves super critical infrastructure and industrial corridors, ports, airports, etc. are slowly attracting the required push from the administration. Mergers, takeovers, acquisitions and joint ventures playing their role saddled with backward and forward integration among the companies are active in this sector. Arup Chatterjee Managing Director LCL Logistix growth. Hence in line with carrying our legacy the company put loads of focus on putting the ‘precise manpower in the right occupation at the right time’ improvising his or her skill sets and abilities by way of customised vocational training and inhouse mentorship. The company duly encourages its employees in pursuing both inbound and outbound training programmes and academic qualifications to grow themselves, meet their objectives and ambitions in life along with aggressive emphasis on its information technology platform to keep its business information management system steadfast. What are the key infrastructural Q challenges facing the logistics industry? What is LCL Logistix doing to turn its Q supply chain into a powerful source of competitive advantage? At LCL Logistix, we firmly believe the human resource to be crucial in achieving consolidated Cost-effective movement of goods involves a blend of different modes of transportation into seamless synergy. Problems like road conditions, poor connectivity, inadequate air and sea port capacities and lagging alternates like inland water transport and domestic aviation have been constant nuisances. Due to these challenges, costs per transaction in Indian logistics sector is much higher compared to those in the developed markets. The bulk of Indian trade is carried by sea, whereas the existing port capacities at major ports are with little infrastructural upgrades making them inefficient to handle free trade flows. World-class infrastructure like modern integrated logistics cum transport hubs and freight corridors at major locations across the country will facilitate more efficient logistics operations going forward. What are the methods and tools Q does LCL Logistix use to evaluate its supply chain? The company, since inception, imbibed some critical propaganda into its DNA like ‘customers first’ offering customised and cost-effective solutions aiming at minimising cost at the customers’ hand, ‘competitive scorecard system’ – each and every activity is duly clipped with an evaluation parameter sheet (operational and financial) which later on being brainstormed at the weekly, quarterly meets. ‘Troubleshooting’ of operational or financial hindrances is done at par involving the line managers and vertical heads simultaneously aligning with the company’s information reporting system. Also ‘information free flow’, where customer is updated at every move with our instated real time information process system, ‘open door approachability’– customer interaction is beyond the organisational hierarchy and ‘one stop solution” – being an intenerated player we try to address the 360 degree service needs of a customer under one single roof. Changing the face of logistics with FTWZs As a concept designed to facilitate import and export of goods and services FTWZs can prove to be great tools to provide seamless logistics support. Nishchal Padhya, Joint Managing Director, Siddhartha Logistics India explains how this can usher an era of ‘Ease of Business’ in India. ogistics play a very important role in international trading transactions of which warehousing is an important element. Free Trade and Warehousing Zones (FTWZs) offer multiple options to stakeholders in any international trading transaction. FTWZs offer multi-flexible operations and legal support to carry out a particular type of international trading transaction. Some FTWZ units like the one in L Sricity are planned to initially offer incubational services. Contrary to the traditional procedure, when goods are declared to arrive at any FTWZ unit the same can easily be taken to FTWZ upon arrival at port directly on simple transshipment procedure. The supplier from abroad can store the goods at any FTWZ unit no local registrations or incorporations is required. Vendor managed inventory is one of the most important trade models which could be carried out from any FTWZ unit. Any supplier who supplies goods to importers in and around India could first ship the stock into FTWZ and supply from the FTWZ itself. Exporters and foreign companies who buy goods from India can get the material inside the FTWZ from DTA and complete the export formalities there and subse- quently ship the material out of India or work upon it (except processing) or even re-sell to any DTA importer in India. Since FTWZs are ports under the Customs laws as well, the same are likely to have a huge impact on the future of logistics in India. Thus logistics players are expected to get into value added services due to flexibilities offered under the FTWZ laws. Nishchal Padhya Joint Managing Director, Siddhartha Logistics India 20 CARGOTALK M A R C H 2 0 1 5 FAMILYALBUM Asia Manufacturing Supply Chain Summit The fourth Asia Manufacturing Supply Chain Summit was held on February 18-19, 2015 at The Westin, Mumbai. The theme of the summit was “RAIN: Rapid Innovation”. The summit featured 50 speakers from across industries who shared their experience with the audience through panel discussions, presentations and case studies. The much anticipated Manufacturing Supply Chain Awards were held on the first evening. The awards were presented by Future Supply Chain Solutions. The award recognises the hard work and applauds true leaders for their commitment and dedication towards manufacturing and supply chain industry. 22 CARGOEVENTS CARGOTALK M A R C H 2 0 1 5 24/7 facilities by Safexpress DIESL wins award for warehouse management With an endeavour to develop 32 ultra-modern logistics parks at key industrial hubs in India, Safexpress has introduced two more facilities DIESL was felicitated with the ‘Indian Supply — Udaipur and Jammu — with not just state-of-the-art amenities but also Chain Logistics Excellence Award 2015’ under round the clock services. the Warehouse Management category. CT B UREAU CT B UREAU panning over an area of 4500 sq feet, Safexpress has recently opened an ultra-modern warehousing facility at Udaipur on February 13, 2015. Built with a column-less span of over 90 feet, it enables rive India Enterprise Solutions Limited (DIESL), the logistics arm of Tata group, has won the ‘Indian Supply Chain Logistics Excellence Award 2015’ under the Warehouse Management Category. S D Pawan Jain, CMD, Safexpress said, “Udaipur is a commercial hub of handicrafts and marble mining such as emerald, lime stone and calcite, the transportation of which is very difficult. Udaipur holds vital importance due to its focal location,” says Jain. Pawan Jain CMD Safexpress loading/unloading of several vehicles simultaneously. The Logistics Park has a floor load capacity of 6 metric tonnes per square meter. Also it has a truck docking area width of over 40 feet and is strategically located on NH 8. The company has also launched another facility at Jammu on February 15, 2015. The Logistics Park at Jammu is also built with a column-less span of over 100 feet and enables loading/unloading of more than 26 vehicles simultaneously. Spanning over an area of 80,000 sq feet, this ultra-modern Logistics Park is strategically located on JammuPathankot National Highway 1A. Jammu region has a large count of food-grain mills and its economy is predominantly dependent on agriculture and allied activities. PHD outlines the needs of cold chain sector Keeping this in mind, Safexpress has developed an ultra-modern facility at Jammu, which will serve as a trans-shipment hub as well as a warehousing facility. The awards, organised by Indian Chamber of Commerce (ICC), is now in its 5th year and was held on February 12, 2015 at New Delhi. The event endorsed by Deliotte was also the official audit partner for the award ceremony. The winners of the awards were selected by a panel of industry leaders. The Jury panel was chaired by SS Khurana, Former Chairman, Railway Board. The panel members included Anwar Ul Huda, Former MemberPlanning Commission, Brijeshwar Singh, Former Chairman, NHAI, Bharat Thakkar, Immediate Past President, ACAAI amongst others. Both the Logistics Parks will be operational 24x7, 365 days in a year to provide time-definite deliveries. Due to the non-stop operations, the facilities will be providing the fastest transit time for deliveries all across India to over 610 destinations from Udaipur and Jammu. Figure Facts: 6 metric tonnes per sq.m floor load capacity Deliveries to over 610 destination from Udaipur & Jammu Loading/unloading of more than 26 vehicles simultaneously (2nd from left) Aditya Gupta – Zonal Business Head, North, DIESL (3rd from left) Sanjeev Khatri – Zonal Finance Manager, North, DIESL ACAAI targets smaller cities At the PHD-GMR Aviation 2015 summit, S L Sharma, President, Air At the National Conference on Cold Chain Cargo Agents Association of India pitched for better implementation of speakers called for investment support and government guidelines on setting up AFS. discussed the guidelines by NCCD. CT B UREAU CT B UREAU HD Chamber of Commerce and Industry organised a National Conference on Cold Chain Technical Guidelines & Standards on January 29 in the capital. P Sanjeev Chopra, IAS, Joint Secretary, MIDH and International Cooperation & Managing Director, NCCD stressed for seamless integration of various stakeholders and called for transparency and easier financial transactions. Pawanexh Kohli CEO & Chief Advisor, NCCD, said Rs 5,000 crore warehousing infrastructure fund has been set up by the NABARD in October 2014 to finance the cold chains under priority sector lending arrangements. He also sensitised the industry about the technical guidelines and standards set up by NCCD for the cold chain in the country. Ranjeet Mehta, Director, PHD Chamber underlined that considering the current level of wastage of fruits and vegetables, cold chain facilities will play an important role in meeting the demand of food in the country. Guidelines to Govt: Provide relevant incentive to private stakeholders Guidelines and standards should to promote innovation he PHD Chamber of Commerce recently organised PHD-GMR Aviation 2015 summit to discuss new regulations and policies besides addressing the key challenges facing the aviation sector. The theme of the conference was “Wings for Indian Aviation”. T The summit also saw the release of a white paper on “Developing Regional and Remote Connectivity” which sought lower taxes on the ATF (air turbine fuel) in order to fuel connectivity to regional air and cargo hubs. S L Sharma, President, Air Cargo Agents Association of India (ACAAI) discussed the government guidelines on setting up Air Freight Station (AFS) across the country. “This is the best way to decongest the airports but a lot needs to be done to achieve the benefits mentioned in the guidelines such as greater efficiency, reduced dwell time, maximum utilisation of installed capacity etc,” he said. According to the guidelines, AFS will create an enabling environment to promote international air cargo operations by reaching out to hinterland regions of the country besides de-congesting the air cargo terminals in some gateway international airports. Suggestions include: • • • At AFSs, the airline to bring their own containers for break and bulk. The terminal handling charges should not be levied twice. The AFS should have an x-Ray facility for airlines containers. S L Sharma President Air Cargo Agents Association of India (ACAAI) • • Special corridor for vehicles connecting the AFS to air cargo complex. AFS must be established in small cities like Aligarh, Moradabad. 24 CARGOSTATISTICS CARGOTALK M A R C H 2 0 1 5 Delhi International Airport Cargo Department, IGI Airport, New Delhi (Airline-wise Import/Export Cargo Performance for the month of JANUARY 2015) S.No Airlines 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 Export Export Export Import without Perishable with (MTs) Perishable Cargo Perishable (MTs) (MTs) (UPL)(MTs) Cathay Pacific 970 Emirates 1058 Etihad Airways 1174 Jet Airways 936 Air India 1011 Qatar Airways 998 Singapore 504 Thai Airways 333 Fedex Express Corpation 386 Kalitta Air 500 British Airways 517 Lufthansa Cargo Airline 489 Swiss Intl Airline Ltd 434 Malaysian Airline System 325 Air France 506 Japan Airlines 280 Uzbekistan 461 Finnair 348 KLM 348 M/S All Nippon Airways 390 Turkish Airlines 311 Virgin Atlantic 282 Saudia 213 Hercules Aviation 382 Lufthansa Cargo Ag 210 United Airlines 194 Ethopean Airlines 91 China Eastern Airlines 177 Air China 185 Korean Airlines 16 Aeroflot Cargo Airlines 156 China Air 112 25 1102 193 125 372 147 23 24 1 0 71 59 11 33 12 2 32 0 4 4 5 3 175 0 24 10 3 0 2 0 37 0 994 2159 1367 1061 1383 1145 527 357 387 500 588 549 444 358 518 282 493 348 352 394 316 285 388 382 234 204 94 177 187 16 194 112 2706 824 1498 1514 1169 509 914 848 510 379 280 295 347 394 226 383 129 177 171 121 153 167 29 17 157 186 265 176 148 309 8 63 Total Cargo (MTs) % of Total 3700 11.08% 2983 8.93% 2865 8.58% 2574 7.71% 2552 7.64% 1654 4.95% 1441 4.32% 1205 3.61% 897 2.69% 879 2.63% 868 2.60% 843 2.53% 791 2.37% 752 2.25% 744 2.23% 666 1.99% 622 1.86% 524 1.57% 523 1.57% 516 1.54% 469 1.41% 452 1.35% 417 1.25% 399 1.20% 391 1.17% 391 1.17% 359 1.08% 353 1.06% 335 1.00% 324 0.97% 201 0.60% 174 0.52% S.No Airlines 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 Export Export Export Import without Perishable with (MTs) Perishable Cargo Perishable (MTs) (MTs) (UPL)(MTs) Air Arabia Oman Air Mahan Air Indigo Cargo China Southern Airlines Gulf Air DHL Express Air Mauritius Blue Dart Sri Lankan Airlines Ltd Asiana Airlines Flydubai Spice Jet Kuwait Airlines Air Shagoon Pvt. Ltd. Air Astana Kenya Kam Air UPS Turkmenisthan Airlines Pakistan International Ariana Afghan Airlines Jetlite Cargolux Iraqi Airways Tajik Air Safi Airways Druk Air Air Moldova 135 95 103 91 72 87 0 60 83 45 50 49 22 4 26 16 21 15 0 10 3 8 3 0 6 3 0 3 0 Total Cargo Handled In January'14' % VARIATION 28 36 11 0 1 26 0 15 0 0 0 9 0 30 0 10 1 0 0 3 0 0 0 0 0 0 0 0 1 163 132 114 92 73 113 0 75 83 45 50 58 22 34 26 25 22 15 1 13 3 8 3 0 6 4 0 3 1 3 3 11 30 45 2 113 19 5 30 23 0 16 3 0 1 0 0 15 0 8 0 5 6 0 0 3 0 0 15308 2671 14773 2737 3.62% -2.42% 17979 17511 2.67% 15411 14504 6.26% Total Cargo (MTs) % of Total 166 135 125 122 118 115 113 94 88 75 73 58 38 37 26 26 22 15 15 13 10 8 8 6 6 4 3 3 1 0.50% 0.40% 0.37% 0.37% 0.35% 0.35% 0.34% 0.28% 0.26% 0.23% 0.22% 0.17% 0.11% 0.11% 0.08% 0.08% 0.07% 0.05% 0.04% 0.04% 0.03% 0.02% 0.02% 0.02% 0.02% 0.01% 0.01% 0.01% 0.00% 33390 100.00% 32015 4.30% Export & Import cargo tonnage handled at CSIA for the month of JANUARY 2015 (Freight in Metric Tonne) S.N Airlines 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Export Jet Airways Emirates Etihad Airways Lufthansa Airlines Cathay Pacific Air India British Airways Qatar Airways Singapore Airlines Saudi Arabian Airlines UPS Ethopian Airlines Turkish Airlines Federal Express Kuwait Airways 3088 3008 1418 1193 879 1169 1275 1146 773 780 494 891 586 757 480 Import Total S.N Airlines 2544 1908 1594 1243 1338 988 600 721 977 368 490 43 345 155 376 5632 4916 3012 2436 2218 2157 1876 1867 1750 1148 984 934 931 912 856 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Swiss Intl. Airlines Air France Thai Airways Delta/KLM/Martin Air Malaysia Airlines Virgin Atlantic Srilankan Air Gulf Air Kenya Airways Oman Air South African Airlines Air Arabia Indigo Air EL-AL Airlines United Airlines Export Import Total S.N Airlines Export 445 495 276 349 309 124 177 220 297 149 244 165 192 131 29 331 255 345 236 275 272 174 102 22 104 7 84 54 83 148 776 750 621 585 584 396 350 322 319 253 251 249 245 214 177 31 32 33 34 35 36 37 38 39 40 41 42 43 0 147 87 24 64 46 42 39 17 34 13 10 2 40 22104 Aerologic Air Mauritius Korean Air Blue Dart Bangkok Airways Fly Dubai Iran Air Yemenia Airways Spice Jet Pakistan intl Airlines Air China Egypt Air Air Seychelles Others Total Import 175 5 64 123 3 11 1 0 20 1 7 3 1 58 16655 Total 175 152 151 147 67 57 43 39 37 35 20 13 3 98 38759 CARGOSTATISTICS MARCH 2015 25 CARGOTALK Traffic Statistics Domestic Freight S.N Airport Freight (in tonnes) For the Month For the period April-November November November %Change 2014-15 2013-14 %Change S.N Airport 2014 2013 (A) 17 INTERNATIONAL AIRPORTS 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Chennai Kolkata Ahmedabad Goa Trivandrum Calicut Lucknow Guwahati Srinagar Jaipur Bhubaneswar Mangalore Coimbatore Amritsar Varanasi Port Blair Imphal Total (C) 6 CUSTOM AIRPORTS 5991 6858 2684 272 119 12 255 614 268 655 320 16 520 4 33 239 335 19195 15.8 9.2 28.7 -1.5 -36.1 100.0 43.1 24.8 64.2 -67.8 52.2 50.0 13.8 800.0 0.0 66.1 10.1 14.4 53885 61673 28173 2060 821 252 2261 6325 4457 1064 3393 242 5016 277 429 1916 3013 175257 47823 56089 23637 1608 1322 116 1955 4560 2637 4736 2527 204 4160 76 295 1640 2739 156124 12.7 10.0 19.2 28.1 -37.9 117.2 15.7 38.7 69.0 -77.5 34.3 18.6 20.6 264.5 45.4 16.8 10.0 12.3 (B) 6 JV INTERNATIONAL AIRPORTS 18 Delhi (DIAL) 24083 18472 19 Mumbai (MIAL) 17858 14410 20 Bengaluru (BIAL) 9671 7184 21 Hyderabad (GHIAL) 3698 3064 22 Cochin (CIAL) 949 791 23 Nagpur (MIPL) 370 370 30.4 23.9 34.6 20.7 20.0 0.0 178008 141543 76215 28701 7539 3827 138240 121226 60636 24241 6226 3386 28.8 16.8 25.7 18.4 21.1 13.0 27.9 435833 353955 23.1 Total 6940 7486 3454 268 76 24 365 766 440 211 487 24 592 36 33 397 369 21968 56629 Freight (in tonnes) For the Month For the period April-November November November %Change 2014-15 2013-14 %Change 2014 2013 44291 24 25 26 27 28 29 Pune Visakhapatnam Patna Chandigarh Bagdogra Madurai 2678 133 452 0 280 88 1836 109 335 253 254 100 45.9 22.0 34.9 -100.0 10.2 -12.0 18343 2501 3452 3224 1955 786 13565 1144 2983 2309 1299 811 35.2 118.6 15.7 39.6 50.5 -3.1 Total 3631 (D) 14 DOMESTIC AIRPORTS 30 Indore 524 31 Jammu 147 32 Raipur 371 33 Agartala 423 34 Vadodara 214 35 Ranchi 207 36 Aurangabad 146 37 Udaipur 5 38 Bhopal 46 39 Leh 136 40 Dehradun 4 41 Rajkot 11 42 Jodhpur 2 43 Dibrugarh 25 Total 2261 (E) Other Airports 158 2887 25.8 30261 22111 36.9 243 133 215 547 197 207 116 0 61 107 0 13 1 16 1856 160 115.6 10.5 72.6 -22.7 8.6 0.0 25.9 -24.6 27.1 -15.4 100.0 56.3 21.8 -1.3 4332 1165 2679 4208 1286 2184 868 14 622 862 23 84 8 189 18524 938 2881 1123 2101 4625 1325 1590 531 0 569 728 0 118 14 193 15798 1045 50.4 3.7 27.5 -9.0 -2.9 37.4 63.5 9.3 18.4 -28.8 -42.9 -2.1 17.3 -10.2 68389 23.8 660813 549033 20.4 Grand Total (A+B+C+D+E) 84647 Traffic Statistics International Freight S.N Airport Freight (in tonnes) For the Month For the period April-November November November %Change 2014-15 2013-14 %Change 2014 2013 (A) 13 INTERNATIONAL AIRPORTS 1 Chennai 17739 2 Kolkata 4309 3 Ahmedabad 1701 4 Goa 105 5 Trivandrum 2407 6 Calicut 1758 7 Lucknow 106 8 Guwahati 1 9 Jaipur 76 10 Mangalore 38 11 Coimbatore 88 12 Amritsar 83 13 Trichy 332 Total 28743 S.N Airport Freight (in tonnes) For the Month For the period April-November November November %Change 2014-15 2013-14 %Change 2014 2013 (B) 6 JV INTERNATIONAL AIRPORTS 17904 3862 1342 116 2043 1636 90 1 13 21 87 23 339 -0.9 11.6 26.8 -9.5 17.8 7.5 17.8 0.0 484.6 81.0 1.1 260.9 -2.1 151127 32494 12124 801 18599 14534 910 12 417 193 617 348 3051 149860 30405 10910 1174 17986 15446 733 10 143 32 641 1281 3092 0.8 6.9 11.1 -31.8 3.4 -5.9 24.1 20.0 191.6 503.1 -3.7 -72.8 -1.3 27477 4.6 235227 231713 1.5 14 Delhi (DIAL) 35719 32079 11.3 288414 259017 11.3 15 Mumbai (MIAL) 40660 38077 6.8 320738 309831 3.5 16 Bengaluru (BIAL) 13745 11676 17.7 111649 100041 11.6 17 Hyderabad (GHIAL) 4642 4105 13.1 36421 32455 12.2 18 Cochin (CIAL) 3689 3014 22.4 43425 27762 56.4 19 Nagpur (MIPL) 61 40 52.5 253 254 -0.4 98516 88991 10.7 800900 729360 9.8 0 2 0 0 - 0 3 10 0 -100.0 - 2 0 - 4 10 - (D) Domestic Airports 0 Grand Total 127261 (A+B+C+D) 0 116468 9.3 86 1036217 0 961083 7.8 Total (C) 2 CUSTOM AIRPORT 20 Pune 21 Bagdogra Total 26 INTERVIEW CARGOTALK M A R C H 2 0 1 5 LSPs face a changing lighting market The lighting industry is undergoing a transformation and the logistics sector has been modifying itself to meet the requisites of this industry. Satnam Singh Grover, Senior Manager – Supply Chain Management, OSRAM India talks about the scope for logistics services from managing operational efficiencies to providing innovative and effective solutions. CT required, reverse logistics as well, is under a single umbrella. We have adopted direct customer delivery options for project orders to cut down on lead time and minimise the handling with overall logistics cost optimisation. BUREAU How do you foresee the future of logistics Q market of lighting industry in India? Vision 2020. The lighting industry is experiencing a paradigm shift with the introduction of LED and replacing conventional light sources; this shift also has an effect on the logistics sector. This shift has directly impacted the transport volumes (downwards). Instead of incandescent lamps or fluorescent lamps (transporting vacuum) now solid state lighting (more compact and lighter) products are being made available to end consumers. There has been impact on warehousing as well for want of space optimisation and modernisation in warehousing operations for accuracy and material handling. The logistics sector also has to align with changing business requirements of the lighting industry. Such shift requisites efficient distribution service provider (3PL) to meet delivery service levels within cost brackets. What percentage of your logistics work Q is outsourced? Satnam Singh Grover Senior Manager – Supply Chain Management OSRAM India How important is efficient logistics for your growth? Tell us about your overall growth also. Q Logistics impact on overall growth goes beyond delivering goods to the end customers. With 8-10 per cent logistics cost, any optimisation will contribute to bottom line. All are affected by the shipper’s ability to assure the customer that it will receive delivery of the shipment, at the right time, at the right place and in good condition with right transport cost. Is there any specific strategy that you Q have adopted for better supply of products? Integration of supply process from customer order or demand planning to customer invoicing leads to better delivery service levels. We have mainly customised well-established processes for the supply of products for our industry. Material movements from vendor till the customer and wherever As we are operating on Hub and Spoke model, our all inbound materials movement operations are directly controlled by company and being received at PDC (Primary Distribution Center) like imports, local merchandised and own manufactured. We have outsourced warehousing and outbound operations (secondary delivery) to LSPs. Warehousing operations and secondary delivery are awarded to same LSPs and other than statutory inventory audits, vendors are required to submit monthly self certifying inventory report (Self Certification). Customer invoicing is controlled by delivery service level measurement that all due clean orders must be invoiced as per schedule and customer delivery confirmations are auditable and PODs are audited at regular intervals. What are your expectations from Q LSPs? The global players entrants, have introduced concept of integrated logistics or supply chain solution providers, but local expertise and understanding is still lacking. LSPs must act as solution providers. It is expected that LSPs must come up with innovative approach for operation efficiencies and cost optimisation as well; this should be a continuous process. Key Points: Infrastructure and complex tax structures are hindrances in smooth execution of logistics activities Dependence on road network, underutilised waterways and no separate rail freight corridor are some infrastructural bottlenecks for the logistics sector Transforming logistics landscape with GST With the booming competition, there is urgent need to cut down transaction cost which is currently 10-12 per cent of the cost of goods and services. Raaja Kanwar, Vice Chairman & Managing Director, Apollo LogiSolutions says GST is needed to bring these down to admissible levels so that Indian goods and services can compete globally. he existing landscape of fragmented, unorganised small godowns and container depots will undergo significant reorganisation with the rollout of the much overdue uniform Goods and Services Tax (GST). The development of large hubs in key locations coupled with smaller spoke warehouses closer to production and consumption centres are expected to emerge following the rollout. T This change in legacy tax structure is expected to be the largest driver of modern warehousing infrastructure. By subsuming a large number of taxes, enterprises will shut down several branches and godowns purportedly set up to take advantage of existing tax laws. It will result in efficient tax administration, improved logistics, transparent dealings, digital compliance, faster and efficient clearance of goods at ports and dry ports. Since IT will be used extensively, it will give auto the benefit of tax paid at earlier stages with the result that a trader or manufacturer will pay logistics sector and go a long way in addressing the government’s initiatives to make India a major manufacturing hub and create millions of new jobs for rapid inclusive growth. the additional tax only. Thus a large chunk outside the tax orbit will now land in tax compliance. Since almost all goods and services (except for a select negative list) will be covered and the tax chain will bring substantial relief to all, the tax net will increase manifold resulting in higher tax realisations. Once GST replaces all multiple taxes, it is going to be the biggest tax reform in independent India’s history. Reduction in tax cost will lead to a favourable impact on tax compliance, economies of scale and supply chain efficiencies. The National Council of Applied Economic Research (NCAER) has estimated that the introduction of GST could push up GDP rates by 1.7 per cent. GST will be the first serious step addressing the needs of logistics industry of which only 10 per cent of activities are in organised sector. It will lead to corporatisation of Raaja Kanwar Vice Chairman & Managing Director Apollo LogiSolutions 28 SHIPPING CARGOTALK M A R C H 2 0 1 5 Realising the true potential of coastal shipping While coastal shipping has the potential to offer tremendous business opportunity in India, bottlenecks have plagued its full-fledged development. CARGOTALK brings you the views of shipping lines on the challenges and speed breakers they face and the ways and means by which these can be overcome. A BEER R AY oastal shipping has the advantage of being more environment-friendly and economical than the rail/road transport, yet it has not received due attention from the government. Despite extensive discussions on the subject, few concrete steps have been taken to accelerate the pace of coastal shipping as a preferred mode of transportation. C It is interesting to note that despite 70 per cent of Indian vessels being engaged in coastal shipping, domestic freight is transported via other modes of transport that are already overburdened and operating at 100 per cent capacity. Despite the compelling need for shift of cargo to waterways, there are challenges and roadblocks that have resulted in low utilisation of this rather safer and cheaper mode of transport. Developed nations rely heavily on coastal shipping as it contributes substantially to their economy. While in India coastal shipping comprises only seven per cent of the local freight, in the European Union nearly 43 per cent of the cargo traffic is moved by coastal shipping and in the US it accounts for a 15 per cent share of the cargo traffic. Vivek Kumar Singh Chief Executive Officer, Shreyas Shipping and Logistics Challenges The advantages of cost and time, which arise out of coastal shipping, get reduced due to first and last mile transportation as well as multiple handling. The country has a peninsular coastline and unfortunately lesser industries are located in the peninsular region resulting in imbalance in cargo movement. Measures If the cargo base is made to shift in the closer hinterland of the ports by way of developing industries and warehouses in areas which can reduce the first and last mile then coastal shipping can surely overcome its main challenge. Alternately, there is a need to look at providing better connectivity to the ports. While the government looks determined to fight the challenges, industry veterans point to certain issues that need to be resolved. Philip Mathews Managing Director, LOTS Shipping Prem Pal Singh Challenges Asst. Vice President, Bharati Shipyard The coastal shipping industry has been seriously compromised by lack of capital. Even the capital that becomes available from traditional banking sources has serious impediments in securitisation and other banking norms. Challenges Lack of separate berths at a majority of ports for handling coastal cargo. Multiple handling costs are involved in coastal vessel trade High costs of wharfage and maritime dues Inadequate cargo handling facilities at several minor ports Lack of adequate repair facilities for vessels in most of the ports Measures Measures Ministry of Shipping should be delinked from road transport Separate dedicated berths in all the major and minor ports for coastal cargo Customs formalities for the vessels purely on coastal trade should be eliminated Road and other infrastructure in, around and from the ports needs to be boosted Wharfage and port dues for coastal ships need to be reviewed and rationalised Suitable incentives to boost coastal cargo need to be provided on an all-India basis Banking norms must be diluted and existing loans in this sector need to be urgently restructured to accomplish completion of the ongoing projects Indian National Centre for Ocean Information Services (INCOIS) must be made mandatory for reception of data on RSV vessel Suitable initiatives need to be put in place to migrate the RSV model to LNG fuels A River Sea Shipping Conference of India should be established Amit Seth Director, ACE Resources and Solutions SK Shantagiri Managing Director, Advanza Logistics Challenges Challenges Very limited financial resources are available to a coastal ship owner at very high rate of interest; apart from that absence of foreign equity investment is also a discouraging factor. Lack of policy stability creates a volatile environment Non availability of qualified coastal crew Poor infrastructure and draft restrictions at many minor ports act as a deterrent for owners to go for a bigger tonnage One of the biggest challenge coastal shipping faces is port infrastructure. Ports always accord step-motherly treatment to coastal trade vis-à-vis the EXIM trade due to lower revenues. Lower priority results in berthing delays and slow customs processing leads to rising cost. Measures Measures While ports should be incentivised by the government to treat coastal ships at par with foreign going vessels, customs processing needs to be computerised. Though the government declares incentives for coastal shipping lines, there is a need to lay down clear procedures to avail them; also there is an urgent need to communicate them. Lastly, the Cabotage Rules need to be amended so that charter of foreign going vessels for coastal trade becomes easier.” A stable policy with tax benefits and other incentives will boost coastal shipping Coastal shipping should be given infrastructure status like roads, ports and railways More training institutions should be set up Capital dredging can be of great help to overcome the challenge of poor infrastructure Ashok K Shrivastava Chief Executive Officer, Allcargo Shipping Services Despite the coastal mode of transport having an inherent advantage, there is a lack of awareness amongst the cargo mover about the existence of coastal shipping. If this mode has to take off, we need to do a thorough market mapping and make those who want their cargo moved aware of coastal mode of transportation. Coastal mode of transport loses its advantage as in its current stage there is lack of cargo flow in both direction and hence the voyage itself becomes unviable due to lower cost expectations from the shippers. Here again unearthing more customers and cargo will ensure a balanced cargo movement. The government can also assist by diverting a part of the cargo under its control to coastal mode. 30 CARGOTALK M A R C H 2 0 1 5 FAMILYALBUM Transforming airports into cargo hubs Air Cargo Forum India (ACFI) organised a Seminar on Transforming Indian Airports into International Cargo Hubs which saw participation of key players from the entire Air Cargo Supply Chain including the Government departments, airlines, freight forwarders, cargo terminal operators, airport operators, customs brokers. Contd. on page 32 SHIPPING MARCH 2015 CARGOTALK Hazira Port breaks Kandla Port record Adani Hazira Port surpassed Kandla Port’s all-time best record handling of 182,748 metric tonnes of cargo in June 2012 by handling 188,684 metric tonnes of rock phosphate important for making fertilisers and acids. CT B UREAU he Hazira Port of Adani Ports and Special Economic Zone (APSEZ) handled a record quantity of rock phosphate of 188,684 metric tonnes, the highest amongst any commercial port in a single calendar month. T Key points: Adani Hazira Port was able to surpass the record feat of Kandla Port because of the sustained patronage of the SSP manufacturers of phosphate on the west coast of India Due to its strategic location, Adani Hazira Port serves the hinterland of South and Central Gujarat, Madhya Pradesh, North Maharashtra and North Rajasthan Adani Hazira Port has five fully operational berths out of the 13 planned The five fully operational berths of Adani Hazira Port have a potential to handle 75 MMTPA of cargo in the coming years India & China to get direct service o cater to the growing exim trade between India and China and far East and South East Asian countries, a weekly direct service called ‘Falcon’ has been launched by Mediterranean Shipping Company SA (MSC), which will also meet the long standing demand of MSC customers for a direct service between the two countries apart from catering to the exim trade to Malaysia, Indonesia, Thailand, Taiwan, Vietnam, Korea and Japan via Singapore. T The introduction of Falcon service would enable MSC to provide improved transits from North-West India to the US West Coast and Australia and New Zealand. The first vessel, MSC Pamela ETA Mundra will call India on April 25, 2015. The feat achieved by Hazira Port beating the all-time best record of Kandla Port handling 182,748 metric tonnes in June 2012 could be achieved due to sustained patronage of the SSP manufacturers’ phos- phate on the west coast of India and also due to its strategic location advantage to serve the hinterland of South and Central Gujarat, Madhya Pradesh, North Maharashtra and North Rajasthan. 31 32 CARGOTALK M A R C H 2 0 1 5 FAMILYALBUM Finding ways to bring efficiency in airports Contd. from page 30 34 INTERVIEW CARGOTALK M A R C H 2 0 1 5 ‘Call in to record toll delays, bottlenecks’ While the government has been trying to modernise the cold chain industry, the NCCD has launched a Reefer Vehicle Call-in-centre. In an interview with CARGOTALK, the first part of which appeared in the February issue, Pawanexh Kohli, CEO & Chief Advisor, NCCD says the industry must participate in this e-governance initiative. CT BUREAU Could you throw some light on the concept of pack houses? Q Pack houses are infrastructure pieces where you can pre-condition the freshly harvested produce, so as to take advantage of the cold-chain as a conduit to market. Without such preconditioning, sensitive produce cannot reach markets. Just like we prepare and pack glass items or eggs to reach markets safely, without damage, similarly, we need to prepare fruits and vegetables to reach distant markets in saleable condition. Without pack houses, virtually, there is no gainful entry for fruits and vegetables in the cold chain. We have invested huge money to build large cold storage infrastructure but we do not have sufficient pack houses in the country. It is now the right time to move backwards along the chain, back to village level and build pack houses which become a source point for the cold supply chain. Pawanexh Kohli CEO & Chief Advisor NCCD The only way fresh fruits and veggies can take advantage of the cold chain is to be subjected through this preparatory stage before moving to market. If we do not do so, our cold stores will continue to serve as a channel for foreign produce and our domestic farm produce will never have a chance to enter this cold supply chain. pack houses in our country along with associated reefer transport units. What is your to-do-list for 2015? Train state-level teams in the right skill sets and delegate responsibility NCCD has recently launched a Reefer Q Vehicle Call-in-centre Ensure right technology is adopted to develop multi-modal cold chain (RVC). What is it about? Push India towards a future ready food distribution system Temperature control effectively buys time by enhancing the saleable life of fresh foods. This time is best utilised to travel to markets. But, if during travel, the time is wasted in unnecessary delays then it is contradictory to the essence of cold chain. These delays are informally stated as bottlenecks on highways, such as extortion, toll point delays, documentary inspections at check points, etc. These are all governance issues and so we launched a toll free number so that formal reports of these complaints can be recorded. Modernise to use existing capacity in an environmentally viable manner Harmonise concepts and procedures with global practices Unshackle from restrictive norms and open up to indigenous innovation This is called RVC and te number is 1800-267-2663. RVC will serve as a single point telephonic contact for recording all forms of in-transit bottlenecks while transporting perishables in the cold chain. It will help create a database of bottlenecks and the response generated from this exercise will help work out long term plans and policies to alleviate bottlenecks and thus to make sure those delays do not happen again. Foreign producers, for say kiwi in New Zealand, don’t build cold stores to store the harvested kiwi locally; instead they create pack houses through which the fruit is rapidly shipped to India. Here, the goods arrive safely and sit in our cold stores as a platform to access our market. So, we need to create TN gets another chemical warehouse The 55,000 sqft warehouse with two multi-user facilities will cater to the chemical sector and industry in Tamil Nadu. CT BUREAU henus Logistics India, opened its second warehouse near Chennai, spread in an area of 55,000 sqft the warehouse, has two multi-user facilities, with about 1 lac sqft of warehousing space near Chennai. The new warehouse will exclusively cater to the chemical sector and boost the industry in Tamil Nadu. R The warehouse is a state-of-the-art facility and fully enabled with latest technologies facilitating the company to handle chemical products with the highest level of efficiency and safety. The warehouse is endowed with modern equipments and has a capacity of 6,000 Pallet Positions with further scalability options, efficient reach trucks with the lifting capacity of G+7 racking systems for 1,100 kgs and forklifts for floor management. “In India we have about 11 lac sq. ft. of warehousing space of both multi user facilities and customer specific dedicated facilities in the cities of Mumbai, Delhi, Chennai, Pune and Ahmedabad. We plan to add 4-5 lac sqft of warehousing space every year. We lease the space and invest in mechanization of operations” says Vivek Arya, Managing Director, Rhenus India. “It shows our commitment to improving our already eminent customer service. We will continue to invest in infrastructure and logistics, to maximize our capability to perform as a leading integrated logistics player,” added Arya. How many calls you have received till Q then? So far, we have received 256 calls wherein only two calls were for extortion which is a pretty positive sign. But we have got equally few calls on toll delays and documentation checks. It looks like that there are negligible bottlenecks, and maybe the small numbers reflect the estimate that there are only about 10,000 actively refrigerated trucks in India. A low complaint base is a good sign, and till date we do not have enough information to act upon, but this RVC will continue for at least one year. If this industry feels the need to help develop policy support, they will genuinely participate in this e-governance opportunity. With their reports, positive interventions can be planned for a better future. In any case, having this facility also serves the purpose to send a strong signal to investors that we are serious about clearing bottlenecks and in promoting ease of doing business. The business of uninterrupted farm-to-fork cold-chain, cannot tolerate interruptions. Form - IV Statement about ownership and other particulars about newspaper CargoTalk to be published in the first issue every year after the last day of February 1. Place of publication : 72 Todarmal Road, New Delhi - 110001 2. Periodicity of its publication : Monthly 3. Printer's Name Nationality Address : SanJeet : Indian : 72, Todarmal Road, New Delhi - 110001 4. Publisher's Name Nationality Address : SanJeet : Indian : 72, Todarmal Road, New Delhi - 110001 5. Editor's Name Nationality Address : SanJeet : Indian : 72, Todarmal Road, New Delhi - 110001 6. Name and address of individuals who own the newspaper and partners or shareholders holding more than one percent of the total capital : Durga Das Publications Pvt. Ltd. Shareholders: 1. Vikramajit, 2 B, Friends Colony, West, ND-65. 2. SanJeet, 72, Todarmal Road, New Delhi-1. 3. Sumati Jeet, 72, Todarmal Road, ND-1. 4. Urmila Vikramajit, 2 B, Friend Colony, West, ND-65 I, SanJeet, hereby declare that the particulars given above are true to the best of my knowledge and belief. Date : 01/03/2015 Sd/SanJeet Signature of the Publisher 36 ACADEMY CARGOTALK M A R C H 2 0 1 5 EVENTS Calendar DOMESTIC EVENTS National Conference on India Supply Chain Management PHD House, New Delhi March 19, 2015 Supply Plus South 2015 Bangalore International Exhibition Centre, Bangalore April 1-4, 2015 ChemLogistics India Bombay Exhibition Centre, Mumbai April 16-17, 2015 CII SCALE Supply Chain and Logistics Excellence Awards Chennai May 21-22, 2015 India Ports & Logistics Conference 2015 Hyatt Regency Mumbai, Mumbai, India May 26- 28, 2015 India Logistics Show Pragati Maidan, New Delhi June 10-13, 2015 Logmat Chennai Trade Centre, Chennai June 19-21, 2015 India Warehousing Show Pragati Maidan, New Delhi July 01-03, 2015 India Material Handling & Logistics Show Pragati Maidan, New Delhi July 01-03, 2015 India Transport & Logistics Show 2015 India Expo Centre, Greater Noida Expressway July 2-3, 2015 Supply Plus Pragati Maidan, New Delhi July 30-August 02, 2015 10th Southern Asia Ports, Logistics & Shipping 2015 Leela Kempinsky Hotel, Mumbai September 17-18, 2015 INTERNATIONAL EVENTS European Shipping Week Brussels, Belgium March 2-6, 2015 Cargo XML Workshop Pudong Shangri-la, China March 9, 2015 World Cargo Symposium Shanghai, China March 10-12, 2015 Europort Istanbul Istanbul Exhibition Centre, Turkey March 11-14, 2015 ICLT 2015 : XIII International Conference on Logistics and Transportation Dubai, UAE April 8-9, 2015 As logistics solutions are increasingly being customised to meet the growing demands of the growing economy, Meera Sethu, Assistant Professor (International Business), Indian Institute of Tourism and Travel Management, Nellore talks about the need to develop curricula, course and modules for effective logistics education in India. argo education in India is still at a nascent stage. The flourishing cargo industry of India is expected to bestow employment opportunities and the existing trend in cargo education needs to be reviewed in entirety to cater to the burgeoning demand of skilled human resources. C The buoyant growth in cargo and allied sectors has been attested; the Indian freight industry is expected to grow at a rate of 10 per cent with the Indian logistics sector expected to record a growth of 15 per cent to 20 per cent per annum vis-à-vis the average world logistics industry growth of 10 per cent. As per NSDC Skill Gap Analysis report, the demand for human resources in the transportation, logistics and warehousing sector is expected to increase from about 7.3 million to about 25 million, leading to an incremental human resource requirement for about 17.7 million in next 15 years. The McKinsey report as cited in Maritime agenda: 2010-2020 states that global cargo growth is expected to grow at 5 per cent to 7 per cent. Beyond doubt, manpower requirement will concomitantly rise. Total manpower requirement at airports alone is to increase from 20000 to 30000 by 2016- There are claims of logistics and allied sectors not luring women and management graduates who are being wooed by companies from other segments. This leaves room for many apprehensions in terms of the future of the cargo industry. As fretting on the backlog of unemployment from economy’s perspective reigns on one side, seemingly voluntary unemployment persists in the logistics and cargo sectors and distinct demand supply mismatch exists. The inherent nature (drawbacks) of the industry, lack of awareness among employable population of the employment potential of the industry and mundane curriculum without endowing necessary inputs appropriate for the industry are three basic reasons attributing to the demand supply mismatch in the cargo and logistics industry. Striking at the roots is the only way to resolve an attempt for bridging this gap that is possible through education. Cargo education in Indian context has witnessed a paradigm shift from short term diploma courses targeting entry level job openings to equipping human resources for managerial positions in cargo and logistics segments. Comprehensive cargo and allied courses along A plethora of issues ought to be addressed at this juncture like existing quality of education imparted for aspirants of cargo and allied sectors, lacunae in the existing academic framework and panacea for redressing the same in an earnest manner. The forthcoming columns shall throw light on these areas, which call for immediate attention diligent efforts from academicians imparting cargo and logistics education. Panama Maritime XII Megapolis Convention Centre April 12-15, 2015 Global Liner Shipping Conference 2015 Empire Riverside Hotel, Hamburg April 21-22, 2015 Air Cargo 2015 New Orleans March 13, 2015 Air Cargo Europe Messe Munchen, Germany May 5-8, 2015 LogiMAT 2015 Nanjing International Expo Center Nanjing, China March 18-20, 2015 4th IEEE ICALT'2015 Valenciennes, France May 20-22, 2015 3rd Med Ports Sheraton Casablanca Hotel and Towers, Morocco March 25-26, 2015 Customise logistics curricula 9th International Conference on City Logistics Tenerife, Canary Islands (Spain) June 17-19, 2015 17 and is expected to spiral fivefold by 2032. Notwithstanding this in 2010, it was estimated that the logistics sector employed 45 million people out of total employable population of nearly 500 million. Documented studies indicate that the supply side is also not very encouraging. with appropriate pedagogy for dissemination of technical and operational aspects of cargo and logistics have been evolved to meet the ever changing dimensions of this arena. Despite all this, more milestones need to be traversed in the future ahead. Meera Sethu Assistant Professor (International Business), Indian Institute of Tourism and Travel Management Customs broker staff training J BS Academy through its chief mentor and director Samir J Shah conducted a two-day training programme at Adani Hazira Port Pvt Ltd along with the Hazira Port Customs. of allied acts; processing; shipping bill filing; ICEGATE etc. It was an interactive programme conducted in Gujarati, Hindi, and English. Participants were given a hand out to facilitate continual handling. The training programme covered various aspects of Customs Clearance from IGM; Bill of entry filing; self assessment; classification; valuation; application The programme also compared various initiatives at Hazira Container Terminal with other CFS and terminals in Western India. Notably the gate manage- ment system and On Dock Exim Yard at Hazira Port, which operates through strong IT systems and is the best in its segment was highlighted. Adani Hazira Port Pvt Ltd and JBS Academy intend to undertake similar trainings for the next two-three years on a regular basis to build good capacities within the Customs Broker community in Hazira. 38 APPOINTMENTS CARGOTALK M A R C H 2 0 1 5 Dredging Corporation of India Swissport Cargo Services Weber Logistics Visakhapatnam Frankfurt America Swissport International (Swissport), the world’s largest provider of ground and cargo handling services to the aviation industry, named Dirk Schmitt as its new Chief Executive Officer Cargo Services Germany & Austria, from February 1, 2015. Schmitt will be responsible for Swissport Cargo Services (SCS) and his responsibilities will include running Swissport’s cargo operations at currently nine online airports as well as several subcontracted European stations. Dan Frank has been appointed as the new President of Weber Logistics, a leading third party logistics company serving the Western US. Prior to this, Frank has held logistics and sales leadership roles for domestic and international companies in supply chain management. Nick Weber, Chairman, Weber Logistics said. We look forward to Dan’s leadership as Weber enters the next phase of our company’s growth.” BlueGrace Logistics Saddle Creek Transportation SITA Tampa Lakeland Geneva Freight logistics company BlueGrace Logistics announced the appointment of Justin Belcher as its Chief Information Officer. Effective February 2, 2015 Belcher has begun leading all aspects of information technology and software development for the Tampa-based company. Belcher has been with BlueGrace since 2009 and his new role encompasses much of his prior responsibilities and will focus greater detail on the company’s vision for technology, business development and supporting systems. Saddle Creek Logistics Services announced on January 22, 2015 that John Erwin has been promoted to Vice President, Saddle Creek Transportation.The creation of this new position was spurred by the rapid growth of Saddle Creek’s transportation division. Erwin had joined Saddle Creek in 2011 as Director of operations support/maintenance. “John has played a vital role in the growth of our transportation division,” said Mike DelBovo, President, Saddle Creek Transportation. Murray Smyth has been appointed as the Vice President Sales – Northern Europe by air transport IT specialist SITA effective February 2, 2015. Prior to this, Smyth founded and led the Airline and Travel Services Business Unit at IBS, a Dubai-based software provider and systems integrator. Dave Bakker, President, SITA-Europe, said, “Murray is the perfect fit for SITA. I am confident that he will help SITA maintain its position as the leading IT specialist for air transport community in Europe.” DB Schenker (India) Etihad Airways Geodis India Rajesh Tripathi assumed charge as Chairman and Managing Director of Dredging Corporation of India on February 2, 2015 pursuant to the Orders of Ministry of Shipping, Government of India. Prior to that, he was working with Ministry of Railways. Tripathi had joined Railways in 1984 and had held several prestigious posts including Project Director of IRCON and Malaysia Railway Project. Mumbai Abu Dhabi Gurgaon Schenker India, part of DB Schenker, appointed Rupesh Gupta as Director – Ocean Freight effective February 2, 2015. Gupta will be responsible for further strengthening the ocean freight operations, procurement and development activities and drive the function at national level. Gupta has with him more than 15 years of experience in the global and Indian logistics market. Gupta brings with him years of expertise with Indian and global markets, which makes him an asset for DB Schenker in India. Etihad Airways appointed Linda Celestino as the airline’s Vice President Guest Services effective from February 2, 2015. Celestino has more than 25 years’ experience in the airline industry having held senior positions in her native Australia and the Middle East, as well as being President of the New York-based Airline Passenger Experience Association. She brings a wealth of experience and expertise to this crucial role which focuses on one of the most important aspects of the business – the guest. Martijn Tasma has been appointed as the new National Sales Manager of Geodis India. Martijn has the overall responsibility for sales and market development of Geodis' freight forwarding and logistics business line in India. Martijn has been associated with Geodis since 2006. Leif Voelcker, Cluster Managing Director, Geodis South Asia said, “We are certain that Martijn’s experience and knowledge of the industry will be a key advantage for us in India’s fast growing and demanding market." Ramesh Mamidala, CEO, Celebi Delhi Cargo Terminal Management India loves to spend time with his family when he doesn’t work. “Kuala Lumpur is my favourite holiday spot. I had a fantastic time there on a holiday with my family,” he says, adding, “In my free time I catch up with my friends. Also, meditating keeps me fresh and in tune with my work.” Mamidala is fond of North Indian food and his favourite sport is badminton. Bharat J Thakkar, Immediate Past President and permanent member board ACAAI and Joint Managing Director, Zeus Air Services unwinds with reading books and watching news. “I love to watch Indian cricket matches and prefer swimming when time permits,” he says, adding, “One of the best places to relax with friends and family is Goa because of its lavashing beauty and unique blend of culture,” reveals Thakkar. When it comes to food, Thakkar says that he loves the flavour of oriental cuisines. As a New Year resolution for 2015, Shesh Kulkarni, President & CEO, UFMI decided to spend more quality time with his family. “Currently work is the single most dominant factor of my life. However, I am also writing a book so when I am not working I take out time for my book,” he says. Kulkarni loves to eat Pan Asian food and his favourite sport is Golf. “Though all my holidays with family and friends have memories attached to it but my favourite vacation spots are Cape Town in South Africa and Grindelwald in Switzerland,” shares Kulkarni. Talking People is a special dedicated corner, created as a sounding board for who’s who of the Indian and International cargo industry. With Talking People, it is our endeavour to bring you face-to-face with people.Contributed by: Kalpana Lohumi
© Copyright 2024