Pro-active and Coordinated approach has helped;
Number of steps taken to ease the problems faced by exporters;
In order to improve availability of containers, India is also targeting to manufacture containers domestically;
Waiting time for availability of containers at ICDs and portscomes down
Shortage of containers has been eased now in the country. Special Secretary in the Logistics Division, Ministry of Commerce and Industry, Shri PawanAgarwal informed this during media interaction today. He said that 58% additional exports have been handled in March (YoY).He added that Container Shipping Lines Association (India) (CSLA)informed that this was about 17-18% more than the level of March 2019( pre-Covid).
During a review along with Federation of Indian Export Organizations (FIEO) and CSLA on 15th April 2021, FIEO informed that due to coordinated efforts, the issue of shortage of containers has been almost sorted out, except some shortage of food-grade containers for export of tea/coffee/spices and is localized to SouthernPorts (Kochi/Tuticorin/Chennai/Mangalore) which CSLA apprised is a long term issue due to import deficit at these ports. Further, CSLA said that the impact of Suez canal blockade is not much anymore. The bunching was handled well by Indian Ports mainly due to timely advance intimation, after the meeting of 26th March.
Close coordination is being maintained between shipping lines and exporters which has resulted in an excellent shared understanding of the situation and requirements and better planning by both sides. The fact that during March Indian exports were at a record level, even higher than the figures of 2019, indicates that the efforts have been fruitful.
The World Container Index (WCI) in March 2021 was 233% higher than a year ago. Non-availability of space in vessels calling on Indian Ports and delayed availability of certain destinations, particularly in East Africa,were other issues affecting trade.Congestion at major ports of the world due to COVID and an acute imbalance between exports and imports in India were largely the factors responsible. In recent months, a spurt in exports has been yet another reason. Following steps have been taken to ease the problems faced by exporters over the past few months:
- In coordination with Shipping lines, drive was taken to reposition empty containers in India on urgent basis. Consequently, 100,000 empty containers were repositioned on Indian ports from across the world by the Shipping lines.
- In early 2020, the quarantine period applicable on ships arriving from China was 14 days. After a detailed discussion with Ministry of Shipping, Ports and Waterways and Ministry of Health and Family Welfare, the quarantine period was reduced to the extent of 5-7 days (which is the time spent by seafarers on board in in isolation after departure from China). This reduced the lead time in repositioning of empty containers.
- In coordination with Customs, a special drive was launchedfor expedited clearance of unclaimed/uncleared cargo. Consequently, more than 2000 empty containers were released.
- Logistics Division facilitated the demand projections of empty containers and circulated it to the Shipping lines. This gave clarity to shipping lines on the actual demand for empty containers in India and plan accordingly. Logistics Division in partnership with FIEO, EPCs and Shipping Lines has also coordinated the development of a Portal for matchingdemand and supply of Containers. The first version of this portal has been made available on FIEO website and has received excellent response from exporters. The portal has been a significant contributor in planning supply of containers during March 2021.
- Facilitated close coordination between shipping lines (CSLA, MSC, Hapag-Lloyd), Container Train Operators ( CONCOR, GRFL, etc) on the one hand, and Exporters on the other hand (including FIEO, All India Sugar Trade Association (AISTA), Indian Sugar EXIM Corporation Ltd). Specifically, for the export of sugar, in a meeting held along with Ministry of Consumer Affairs and Public Distribution on 25th Feb 2021, the ports were advised to provide priority berthing to break-bulk carriers, so that while the container shortage is persisting, some off-loading through break-bulk transportation can be arranged. Railways in this regard offered to ensure unhindered supply of wagons.
- Indian Railways provided free movement of empty flats and empty containers for 71 days during March to May 2020. Currently a 25 % concession in haulage of empty containers and empty flats has been provided upto 30-4-2021. A 5% concession for haulage of loaded containers has also been provided from Sep 2020 till 30 April 2021. Stabling charges levied on container rakes has been waived off fully till 31 March 2021. With effect from April 1, 2021, the haulage charges of empty containers from port to hinterland have been reduced by 50% by CONCOR through a discount scheme. This is expected to result in reduction of overall shipping cost.
By early March 2021, the waiting time for availability of containers at ICDs and ports was down to a maximum of 2-3 days (booking date to container pick up date).At several terminals like Tughlaqabad, Dadri, Jaipur etc and terminals on Delhi-Panipat route, the figure is less than a day.
Blockage of Suez Canal for a few days in March 2021 had seriously impacted global trade. (Route used for Indian exports/imports worth US$ 200 Bn per year to/from North America, South America and Europe.) To meet with the situation proactively, mitigate/minimize the impact and to sustain exporter confidence, a Four-point plan was chalked out by the Government of India on 26 March, 2021. This included 1) Prioritization of cargo 2) Stability in Freight Rates 3) Advisory to Portsto prepare for expectedbunching once the canal reopens 4) Re-routing decisions.
In order to improve availability of containers India is also targeting to manufacture containers domestically. CONCOR has already issued an order of 2000 containers to M/s BHEL, and Braithwaite and Co. Ltd. Discussions have been initiated with steel manufacturers for producing COR-TEN steel in India at competitive prices and with Railway wagon manufacturers/ BHEL/Private manufacturers DCM-Hyundai, Balmer&Lawrie etc. to set up production lines for indigenous manufacturing of containers.