CARGOCONNECT August 2018

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VOL IX ISSUE IX august 2018 `20

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Multimodal

Logistics Parks

leveraging growth

opportunities!

Truck axle load capacity 08 Centre adds enhancements 12 Air v/s Sea Freight: 36 E-way Bill reducing 48 revised after 35 years to Sagarmala Project Making the Right Choice turn-around-time of trucks

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Contents

Volume IX • Issue IX • AUGUST 2018

Editor and Publisher Smiti Suri Principal Correspondent Ritika Arora Bhola Special Correspondent Gaurav Dubey Correspondent Upamanyu Borah

36

16 COVER STORY

Multimodal Logistics Parks: leveraging growth opportunities!

SPECIAL FEATURE

Air v/s Sea Freight: Making the Right Choice

Marketing Managers Niti Chauhan Parminder Singh Rahul Arora Asst Manager Marketing Mehuli Choudhury

INTERVIEW

focus

Truck axle load capacity revised after 35 years .......................................................08

Director Ajeet Kumar

REyaz Farook Chairman, HTL Group ...............................58 Neeraj Bansal CEO, DHL SmarTrucking, DHL India ............60

Marketing Executive Twinkle Thakur Accounts & Administration Nitish Kumar Sr Designer & Visualiser Shaique Ahmad Designer & Visualiser Mayank Bhatnagar

FRONTLINE ..............................................6 Shippers Speak ...................................62 GUEST COLUMN ................................64-65 Centre adds enhancements to Sagarmala Project ....................................................12 FEATURE

APPOINTMENTS .....................................66 NEWS ...............................................68-74 PROFILE .................................................75 Viewpoint .............................................75

All material printed in this publication is the sole property of CargoConnect All printed matter contained in the magazine is based on the information of those featured in it. The views, ideas, comments and opinions expressed are solely of those featured and the Editor and Publisher do not necessarily subscribe to the same.

CargoConnect is printed, published and owned by Smiti Suri, and

is printed at Compudata Services, 42, Dsidc Shed, Scheme–1, Okhla Industrial Area Complex, Phase–II, New Delhi-110020, and published at 6/31-B, Jangpura–B, New Delhi-110014 Editor–Smiti Suri

EVENTS ............................................76-79 UPCOMING EVENTS ................................80 E-way Bill reducing turn-around-time of trucks .....................................................48

PEOPLECONNECT Dr T Johnson

Managing Director, Greenways Group .............................82

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FRONTLINE I want to assure the transport unions that the government will take positive steps towards their demands discussed during our meetings. We regret the problems faced by the public due to the recent truckers strike,” – Nitin Gadkari Minister of Road Transport and Highways

GST on fuel cell vehicles reduced from 28 per cent to 12 per cent. This will provide a major push towards development and adoption of more environment friendly modes of transportation in India” – Suresh Prabhu, Union Minister of Commerce and Industry and Civil Aviation

The Commerce Ministry has expedited the movement of the proposed Multimodal Transportation of Goods Bill 2018. As per the reports, the ministry will soon approach the Union Cabinet to seek approval on the bill so that it could be placed in the parliament for discussion.

We are taking steps to strengthen Air India’s management practices and operational efficiencies so as to make it profitable again” – Piyush Goel, Minister of Railways and Interim Finance Minister

Introduction of the e-NWR is part of the digitalisation of registration, monitoring and surveillance of e-NWR, wherein farmers and traders will get better and transparent access to the market.”

- Dr B B Pattanaik, Chairman, Warehousing Development Regulatory Authority (WDRA)

6

CargoConnect - august 2018

The Madhya Pradesh High Court rejected a writ petition filed by a leading logistics company of the country which resulted into a nation-wide strike of transporters. The company has filed the petition against a whopping penalty of `1.32 crore for alleged non-compliance with the requirements of E-Way bill.

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focus

Truck axle load capacity revised after 35 years Gadkari claims the move will take down the Logistics cost by 2 per cent The Union Government of India has changed the ‘Axle loads’ capacity of trucks after 35 years of the previous notification which was issued in the year 1983. The government has decided to increase the axle loads after taking into consideration the qualitative and quantitative changes in National Highways as well as reforms in heavy automobiles.

The load carrying capacities of heavy vehicles, including trucks, have been increased by 20-25 per cent at par with global standards, and it would help in reducing logistics costs, Road Transport Minister Nitin Gadkari said while addressing the media persons.

Besides, the requirement for annual fitness certificates for trucks have been done away with and these certificates need to be only renewed every two years.The government has made changes to regulations governing “axle loads”. Prior to this, the changes were last notified in 1983.

“We have increased the axle load for transport vehicles. The automobile

8

CargoConnect - august 2018

Briefing correspondents, Nitin Gadkari, Minister of Road Transport & Highways, Shipping, Water Resources, River Development and Ganga Rejuvenation said the decision to increase axle load was taken with a view to help in increasing the carrying capacity of goods transport vehicles and bring down logistics cost. He said the amendment will increase the carrying capacity of goods vehicles by about 20-25 per cent and lower logistics costs by about 2 per cent. The Minister further said that while automobile technology and road construction quality have improved greatly over the years, the axle loads have remained the same since 1983 when they were last notified. There was a need to harmonize the axle load with international standards.

The minister also said that overloading rules will be implemented very strictly. State governments are also being requested to enforce the provisions against overloading very strictly and not allow vehicles to move till the excess load has been removed.

focus Maximum Safe Axle Weight Sl. NO

Axle Type

1

Single Axle

1.1

Single Axle with single Tyre

3.0 tonnes

1.2

Single Axle with two Tyres

7.5 tonnes

1.3

Single Axle with four Tyres

11.5 tonnes*

2

Tandem Axles (Two axles) (where the distance between two axles is less than 1.8 Mtr.)

2.1

Tandem axle for rigid vehicles, trailers and semi-trailers

21 tonnes*

2.2

Tandem axle for Puller tractors for hydraulic and pneumatic trailers

28.5 tonnes

3

Tri–axles (Three axles) (where the distance between outer axles is less than 3 Mtr.)

3.1

Tri-axle for rigid vehicles, trailers and semi-trailers

27 tonnes*

4

Axle Row (two axles with four tyres each) in Modular Hydraulic trailers (9 tonnes load shall be permissible for single axle)

18 tonnes

technology and road construction quality has improved considerably.

“We needed to harmonise our axle loads with international standards.

This will help in increasing the carrying capacity of good vehicles by about 20 per cent to 25 per cent. The logistics cost would go down by 2 per cent due to this initiative,” said Gadkari.

The minister mentioned in his address that the decision to increase the load capacity was taken after discussions with stakeholders and the move would enable 16-tonne vehicles to carry 19 tonnes, 25tonne vehicles to carry 28.5 tonnes and 37-tonne vehicles to carry 42 tonnes load.

10 CargoConnect - august 2018

Maximum Safe Axle Weight

According to the minister, the move would help in checking corruption and overloading which is rampant.“Advisory is being issued to states to implement the new norms and take stringent action against those violating the new loading capacity norms,” he said.

IFTRT raises voice of discontentment Officials of Ministry of Road Transport and Highways (MoRTH) have been claiming that they consulted stakeholders on their decision of axle load limit enhancement but the industry stakeholders have been claiming otherwise.

“Overloading is very rampant. We need to control it. We will now enforce the overloading rules very strictly. We are also requesting the states to enforce provisions against overloading and not allow any overloaded vehicles to move till excess load is removed,” Gadkari said.He also noted that logistics cost in India is exceptionally high at about 13 to 14 per cent whereas it is about 8 per cent in developed countries.

Interestingly, government for inexplicable reasons did not follow the standard route to come up with draft notification inviting objections and suggestions from general public within 30 or 45 days.

Shamsher Dewan, Vice President & Sector Head (Corporate Ratings), ICRA said to a leading English daily that, “increase truck axle load by 20-25 per cent would be marginally negative for CV demand in volume terms as overloading has been a common phenomenon in India”.

This creates shadow on the official working in the MoRTH. A leading truck manufacturing company in its conference has specifically stated that the Industry has not been consulted prior taking the decision of increasing axle capacity of trucks. This clearly states that the decision was taken on a unilateral basis. Thus, the Indian Foundation of Transport Research and Training (IFTRT) demanded from MoRTH to clear its position on taking the decision on unilateral basis.

focus

Centre adds enhancements to Sagarmala Project The blueprint of the Sagar Mala project—an infrastructure-cum-policy initiative being readied by the shipping ministry—seeks to allow the central government to have a say in the development of non-major ports without adopting a confrontationist approach with the state governments.

The initiative, according to the ministry, will strive to tackle all the challenges by focusing on port modernisation, efficient evacuation and coastal economic development through a structured framework for ensuring inter-agency collaboration and integrated development. It will provide the necessary institutional framework to enable the central and state authorities to work together for ensuring inclusive growth.

While the Sagarmala project is expected to steer port led development in the next three years, the Shipping Ministry plans to foray into other spheres that will lead to job creation and economic growth, besides addressing some of the port sector’s own problems.

12 CargoConnect - august 2018

Union Minister for Shipping, Highways, Road Transport and Water Resources - Nitin Gadkari, has offered to develop another major port in Andhra Pradesh at Vadarevu in Prakasam district, if the State government is able to provide 3,000

acres of land for the purpose. Recently, while addressing the media, Gadkari has said that `16 lakh crores would be spent on port projects and to improve road connectivity to ports, generating one crore jobs, under the Sagarmala project. In the first phase, `8.76 lakh

focus crores would be spent on 576 projects.

He said 69 projects had been completed at a cost of `13,500 crores and 222 works are still on, entailing investment of `2.5 lakh crores.

“Under Sagarmala, I am going to lay foundation stones to National Highways projects in the State entailing investment of more than `6,688 crores,” he asserted. His ministry would spend more than `3 lakh crore in Andhra Pradesh under the Sagarmala project, for National Highways and Waterways, he further added.

Referring to Vizag port, Gadkari said the Government was planning a free trade zone at the port and also a satellite port under the Vizag port. He said he was going to dedicate to the nation the modernised and upgraded iron ore handling complex by Essar in Vizag port at a cost of `830 crore.

He said a floating hotel was being built off Mumbai and the Vizag port should also seriously consider such a proposal.

Further, cruises would be encouraged at all ports and also in the Krishna River. Under the Sagarmala project, connectivity to other ports in the State such as Kakinada and Krishnapatnam would also be improved.

In response to a question, he said there need not be any fears of the Visakhapatnam-based PSU Dredging Corporation of India going into private hands. Major ports in the country, including Vizag, will pick up stake in the PSU.

Ports should come up with innovative ideas to increase their efficiency and profitability,” Gadkari said.

“Under Sagarmala, we have earmarked `7,000 crore for development of blue economy and agriculture. In the Jawaharlal Nehru Port Trust, we have allotted land for an SEZ, with an expected investment of `1,000 crore, which will be a 100 per cent exportoriented unit,” he said.

While Kandla Port in Gujarat currently has a 15 MW wind power generating facility, it has been proposed to generate 2000 MW of wind and solar power in a hybrid model.

“This will be very useful for the port sector as ports are now buying power at

`11 per unit. Once the 2000 MW power is generated, we can it get it for as low as `2.40 a unit.

The Union Ministry of Power is ready to invest money on this and the power produced will be given to NTPC,” he added.

He said three desalination plants would be established on a pilot basis at Tuticorin, Kandla and Paradip. When power is available for less than Rs three (per unit), fresh water can be produced at just three paisa per litre from the desalination plants. “This water will be supplied to urban areas closer to the ports first and then rural areas where it will be very useful for agriculture. If that is successful, it will be a great thing for the districts that are connected to the sea coast,” he added. Gadkari said a general purpose wagon investment scheme was also being worked out for better evacuation of cargo at a lesser cost.

“We will invest in wagons, rakes and rail engines independently with the permission of railways. We can this increase freight movement, overcoming the problems now being faced in getting rail wagons in time,” he pointed out.

Referring to tourism, the Shipping Minister said there were 20 proposals for operating cruises. The Shipping Corporation of India would be given Rs 800 crore to procure necessary cruise boats, while cruise terminals would be built at all major ports.

“On August 1, we will be launching the first cruise service from Mumbai to Goa with a passenger capacity of 500.A new terminal will come up in Mumbai for domestic and international cruises,” Gadkari said.

A cruise service would also be launched on river Krishna soon.

He asked all minor and private Port operators to build cruise terminals to improve water transport in the country.

14 CargoConnect - august 2018

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cover story

Multimodal

Logistics Parks

leveraging growth opportunities!

16 CargoConnect - august 2018

cover story

M

ultimodal Logistic Park as the name suggest is one centralised place for all types of transportation activities and value added services needed by exporters and local traders for shipment of their goods.

It is often defined as rail/road/sea based inter-modal traffic handling facilitation complex comprising container terminals, bulk/break- bulk cargo terminals, warehouses, banking and office space and facilities for mechanised handling, inter-modal transfers, sorting/grading, cold chain, aggregation/desegregations, etc. to handle freight traffic.

Transforming India’s logistics landscape will help realise the country’s enormous economic potential. To succeed, what is needed is a collaborative effort to define a clear, longterm, and sustainable vision encompassing initiatives that are proactive rather than reactive. This, in turn, requires a logistics planning approach that considers various modes of transportation cutting across state boundaries, and balances the slew of infrastructure investments with appropriate policy and regulatory reform measures. The MMLPs will be a critical first step toward realising this vision.

Upamanyu Borah

The Indian logistics sector being granted infrastructure status is a landmark move having wide-ranging implications for an industry that is now set to grow 10-15 per cent annually. Specifically, the sector is now included in the Harmonised Master List of Infrastructure Sub-sectors under a new head ‘Transport and Logistics’, and categories such as multi-modal logistics park, cold chain facility, and warehousing facility have been defined. This will have decidedly positive implications, paving the way for a well functioning integrated transport network to secure efficient flows of freight, with making the sector a sought-after asset class for investments.

Current logistics issues and trends in India Increased outsourcing of logistics services to a developing market: There are many logistics service providers consisting of only one or two persons owning one or two trucks which are not very organised and whose workload is volatile. Especially in the big cities, there are a vast number of unorganised small truck owners and service providers for last mile distribution. Yet, there also

august 2018 - CargoConnect

17

cover story The key to MMLPs success would lie in improvement of road, railways, and other modes of transport to ensure smooth and uninterrupted linkages. Apart from infrastructure development, the success of these parks is also dependent on various other factors.�

Vikas Yadav, Director, Future Warehousing Solutions Pvt Ltd

are a few larger companies that operate big fleets of well-coordinated vehicles with different capacities. This is rather the exception though and there is no consolidation of that sector within a lobby. There is only the CII or the FICCI. Also, there are no guidelines for traffic tariffs and their payment, which complicates the situation significantly. This especially is a big issue in the last mile distribution. Since many companies in the manufacturing sector are growing in size, non-core activities are being outsourced. City level warehousing is often given to small players who have their local warehouses, which then outsource warehouse management to other companies. The transport sector is so fragmented that lots of activities are outsourced to smaller players what is even increasing with the manufacturing and retail sector growing in size. Another issue is that 51 per cent of the retail sector is composed by multinational companies.

Despite the growth of the retail sector, integrated value added services and reverse logistics have not yet been explored for these big supply chains.

Regarding automation and the use of technology, high-tech is mostly not affordable for small service providers. Hence, mostly rather lower technologies or even no technology at all is being used in practice.

Safety issues and inefficient regulations: Regarding risk or safety in the supply chains, it might not be easy to change the behavior within the informal sector towards more safety. Especially the human risks are a major issue in India compared to European countries. Concerning storage and

18 CargoConnect - august 2018

warehouse related risks, the fragmented private logistics companies do not cooperate well along the logistic chains, what makes these risks to a big common issue. Risk management in global SCs, especially financial risks, are another important issue to be considered in the future. A further problem area is regulation. In certain ways, there is a lack of regulations and regulation implementation. Regarding trucks, there is a high tendency to overloading and exceeding the driving time limits. Also, safety regulations are very poor what gets even worse when considering road and traffic conditions. Safety laws do exist, but their implementation and enforcement is problematic. There are some safety-related areas where the laws are even less efficient. The tax structure in India is a further problem. When crossing borders between states, trucks often have to endure long waiting times at checkpoints because most states have different tax structures. However, with the passing of the E-Way bill, this concern is now being addressed.

Coping with infrastructure deficiencies: India is considered a manufacturing hub and freight volumes have drastically increased. Economic growth is driving demand in transport and with a losing market share of railways most of the goods are being moved by road.

The Indian railways are still a monopolistic organisation with a huge network and an integrated system, not yet ready to be opened up for private ownership. Even though there are initiatives for improvement, they

all need to be approved through a very long and inefficient internal process. The railway infrastructure is still on a stage of “not yet broken down�, other sectors are doing better though. There is work being done in the areas of development of locomotives, manufacturing of coaches, catering on trains, constructing lines, operating services, pricing and scheduling. However, rail construction and signaling equipment installations are still done by companies like Siemens. All in all, there is a huge potential and interest in railways.

The use of inland waterways, primary in the east, connecting Calcutta and the ports in Orissa to the mines, has been explored, but inland waterways have been a huge failure since the water levels are too low and fresh water is rather used for consumption and agriculture than for transportation. Further, the inland waterway network is not maintained at all so there is a complex set of problems in that area.

Today, warehousing and rail-road interfacing are major issues concerning sustainability and transport costs.

Bulk is being moved by rail since railway lines can be connected directly to mines or big manufacturing plants. For consumer goods and durables on the other hand, there is a significant flow between Mumbai and Delhi or Ahmedabad that still needs to be done by truck because the interfacing is still not good enough.

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cover story Development of logistics infrastructure in the form of multi modal logistics parks is aligned to the management of logistics costs with the help of multiple parameters like developing the ability to map demand accurately, undertaking infrastructure enhancements, developing technology tools, along with managing order visibility, quality of service, timely supply, delivery and clearances.”

Rachid Fergati, Managing Director, Indian Sub-Continent, UPS

is not yet planned in India, so there is not much significant work being done to improve logistics nodes and promote intermodal transport. The development in the transportation sector is huge though. It is growing about 10 per cent per year, but only in scale. A lot of freight was done by rail in the past, but now truck transportation is increasing, because the roads have been improved. Also, the truck sector is growing faster than the railway sector and private seaports are coming up. The greatest potentials are in the intermodal logistics nodes for transport networking and transport distribution since there is some political interest in this area. In fact, Mumbai or Chennai are candidates for an intermodal hub, because there is a high rate of traffic, industrial activities and sea ports.

The infrastructure corridor between Delhi-Mumbai and the related freight corridors for rail are currently being developed. Also between Delhi, Jawaharlal Nehru Port and Calcutta dedicated rail freight corridors are being developed. The involved parties are also planning to build a high number of logistics clusters and container freight stations (CFS) along these corridors. Regarding multimodal logistics hubs, primarily between road and rail, optimal locations still needs to be identified. Also, the connectivity from the mines (minerals) to the DelhiMumbai industrial corridor is being improved. Furthermore, other container freight stations are currently being planned. There is a focus on national highway development that includes expressways, super expressways and air linkages. Nashik, Gurgaon and Kochi are new logistics

20 CargoConnect - august 2018

clusters or hubs. Moreover, the aviation sector has grown tremendously, but infrastructure related to civil aviation still needs to be developed much further.

Major issues in cold and food chains: There are many activities in the area of cold and food chain management due to increased government initiative and funding in this area. India has an old but quite good public distribution system for movements of food across the country. The major food crops are in localised pockets near to Delhi and are distributed all over the country from there. The crops need to be delivered to warehouses in order to be processed. Warehousing in food supply chains is a very big problem in this case. Agricultural SCM is rather unorganised and inefficient and the public distribution system in food SCs is not very effective either. There is a lot of wastage during storage, lead times are high and security issues are not considered. The aim would be to develop good warehouses, cold chains and food chains.

So finally, the agricultural, processed food and cold chains need to be improved significantly. Therefore, the government is currently making substantial investments in this area, mainly in the food chains.

Lack of specialised training and education: Even though the logistics sector is growing, whether it is roads, aviation, railways, containers or the use of various modes of transport, the amount of students and the technical knowledge in the sector is quite low. But in the manufacturing part

of the curriculum, people have an understanding of different technologies so that they can find a natural way to enter those sectors. In the areas of logistics there is a great need for education, but there are not enough institutions that offer training in logistics.

However, the skill development efforts in the transportation, warehousing and packaging sector are an important trend. Not only skills, but also attitude and behavior are important in managing supply chains, which needs to be dramatically improved.

Logistics Parks – Implementation and Effects When the union government in May’17 announced its initiative to develop a network of 35 multi-modal logistics parks (MMLPs) across the country under the ‘Bharatmala’ programme, it was seeking to transform the abysmal scenario wherein logistics accounts for about 18 per cent of the total product cost in India, as against 8-12 per cent in China and 12 per cent in Europe. The parks are expected to help the industry transition from point-to-point freight movement to the hub-and-spoke model followed in developed economies. Under implementation is an integrated policy that improves efficiency in freight movement.

The project, a brainchild of Minister Nitin Gadkari, will be implemented in two phases, with phase I totalling about `155 crore and phase II around `115 crore. It is being backed by Asian Development Bank (ADB), which focuses on infrastructure development in Asia. The development includes railway sidings, container terminals, warehous-

cover story Government will have direct revenues (and profits) through collection of charges from sources like rail terminal access charge, rental charge for space given out to various users of MMLP, rental charge for usage of warehouse facility, and terminal handling charges.”

Viral Shah, Executive Director, V Trans (India) Ltd

ing, non-cargo processing, a truck terminal, common facilities, support infrastructure, and equipment.

for the Park – the location should not only have the requisite infrastructure, but should also house industries.

• Cutting edge information technology for delivery management also plays an important role for MMLPs to work effectively.

• Government and Private partnership – policy incentives and regulatory reforms should open new business opportunities for private companies to invest in and operate MMLPs.”

The challenge, though, is the availability of land at right prices as it would impact the transaction cost for transport service providers once the MMLPs are established.

Articulating the factors that will significantly contribute for MMLPs to work effectively, Vikas Yadav, Director, Future Warehousing Solutions Pvt Ltd says, ‘’The key to MMLPs success would lie in improvement of road, railways, and other modes of transport to ensure smooth and uninterrupted linkages.

Talking on similar lines, Viral Shah, Executive Director – V Trans (India) Ltd states, “Modern mechanised warehouses, catering to the needs of different industry segments would enable MMPLs to be effective in terms of higher storage and handling inventory losses, along with efficient multimodal freight transportation -

Apart from infrastructure development, the success of these parks is also dependent on various other factors: • Identification of a suitable location

Development of Multimodal Logistics Parks

North Punjab Jalandhar, Amritsar, Gurdaspur

Jammu

South Punjab Ludhiana, Sangrur, Patiala

Ambala Jaipur Kota

North Gujarat Ahmedabad, Vadodara South Gujarat North Gujarat

Delhi - NCR Delhi, Faridabad, Gurgaon, Ghaziabad

Valsad

Guwahati

Patna Kolkata

Nagpur

Jagatsinghpur

Pune Hyderabad

Mumbai Mumbai, Mumbai Suburbs, Jnpt, Mumbai Port, Thane, Raigad dist.

Visakhapatnam Vijaywada

Bangalore Chennai Coimbatore Cochin

Salience of Each Node (Ranking) 1-10 11-20 21-35

22 CargoConnect - august 2018

Road, rail, air and waterway connectivity.

Being able to provide value added services such as customs clearance with bonded storage facility, warehousing management services along with activities such as kitting and final assembly, grading, sorting, labeling and packaging activities, return management, etc. will also make MMLPs more effective.”

Rachid Fergati, Managing Director, Indian Sub-Continent, UPS opines, “Development of logistics infrastructure in the form of multi modal logistics parks is aligned to the management of logistics costs with the help of multiple parameters like developing the ability to map demand accurately, undertaking infrastructure enhancements, developing technology tools, along with managing order visibility, quality of service, timely supply, delivery and clearances.

With an ideal multimodal hub, cost of handling can be reduced and processes can become more efficient.”

However, explaining the reluctance of Indian companies to invest in logistics, experts have been pointing out that the return it offers on capital is much lower compared to other industries. The sector has attracted investments from private equity firms though. Business houses from overseas are also reported to have expressed interest.

Meanwhile, the Centre plans to work with the state governments and the private sector to set up 34 mega logistics parks across the country. It has already allocated `1,00,000 crore for such targeted development.

Logistics-dependent sectors to benefit India is already home to leading indus-

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cover story With the introduction of GST the concept of Tier 2 and 3 cities are no more a priority in terms of warehousing. The only demand for warehousing in these cities lies on the marketing strategy of the seller. If the strategy is time to market then they need smaller warehouses in these cities.”

Rahul S Dogar, Director - Strategy & Business Development, Holisol Logistics Pvt Ltd

tries such as automotive components, pharmaceuticals, cement, textiles, fastmoving consumer goods (FMCG) and e-commerce.

Private sector companies across the above mentioned sectors, whose operations depend hugely on warehousing and logistics, are now likely to register tremendous growth in Tier-II and III cities. These companies will need a stronger network of warehouses and

“Well, definitely, the Goods and Services Tax (GST) was the most transformative reform, creating a single national market. Tax uniformity and the removal of interstate checkpoints is leading to the consolidation of warehouses into bigger spaces and creating greater overall efficiencies, especially among large and modern firms. GST is enabling companies to plan their manufacturing and distribution locations more strategically. According

per cent to the overall demand in the emerging E-commerce sector. With the saturation in India’s key metropolitan cities, bulk of the warehousing demand across the sectors will stem from these emerging cities. So as a leading provider of warehouse spaces, it become necessary on our part to frame our strategy considering the overall market dynamics i.e. in key established logistics cluster as well as the upcoming destinations. At the moment, tier 2 and tier 3

Alongside key Indian markets, tier 2 and tier 3 cities are adding roughly 45 per cent to the overall demand in the emerging E-Commerce sector.

With the saturation in India’s key metropolitan cities, bulk of the warehousing demand across the sectors will stem from these emerging cities logistics facilities in smaller cities for growth. The changed status, in turn, will boost the viability of opening up businesses in different regions, translating into more demand and growth.

Tier-II and III cities will become growth centres. According to a recent report, India’s logistics and warehousing sector is already destined for a quantum jump with the advent of GST and associated infrastructure push to improve surface and air connectivity across the country.

24 CargoConnect - august 2018

to a recent CBRE report, GST is positively impacting the warehousing segment–7.4 million sq. ft. of industrial and warehousing space was leased in H1 2017 across key cities, a 50 per cent surge from H2 2016,” articulates Rajesh Jaggi, Managing Partner, Real Estate, Everstone Group.

Sandeep Chadha, CEO, All Cargo Logistics & Industrial Parks asserts, “Alongside key Indian markets, tier 2 and tier 3 cities are adding roughly 45

cities are acting as second fiddle to its larger tier 1 counterparts and are helping in managing the burgeoning demand. Going forward these emerging will take the greater mantle and will help in overall consolidation at the industry level.”

However, Rahul S Dogar, Director Strategy & Business Development, Holisol Logistics Pvt Ltd has something different to add to it. He avers, “This is a contradictory question tak-

cover story MMLPs are large facilities and needs cooperation and strategic insights on part of all the stakeholders involved. The larger the scale, the better the efficiency and all of it results into an enhanced bottom-line. So in this regard MMLPs are here to serve as enabler of profits to all its patrons.”

Sandeep Chadha, CEO, All Cargo Logistics & Industrial Parks

ing into picture GST implementation.

With the introduction of GST the concept of Tier 2 and 3 cities are no more a priority in terms of warehousing. The only demand for warehousing in these cities lies on the marketing strategy of the seller. If the strategy is time to market then they need smaller warehouses in these cities. Or if the concentration of sales of the product is concentrated in that particular city then the demand for warehousing will be more. Or else these cities will be more of smaller transit warehouses.”

On the other hand, Viral Shah, highlights four crucial points: • Boost to indigenous entrepreneurs, who will provide allied services.

• Awareness of e-commerce is already there in tier 2 and 3 tier cities. Having proper support in terms of logistics facilities will go a long way in boosting demand for various goods and supplies through ecommerce medium.

• The relatively easier availability of land at economic prices in tier 2 and tier 3 cities is already attract-

MMLPs expected to bring down logistics costs by performing 4 functions: Freight aggregation and distribution

Multi Modal freight transportation

Value added services (VAS) such as customs clearance with bonded storage yards

26 CargoConnect - august 2018

Storage and Warehousing with modern, mechanised Warehousing space satisfying the special requirements of different commodity groups

ing developers and private equity players to invest there for setting up logistics facilities.

• Good connectivity to major economic hubs along with economical real estate, labour and service costs, will drive growth in tier 2 and tier 3 cities.

India is ranked 35 out of 160 countries on the World Bank’s Logistics Performance Index (LPI). Between 2014 and 2017, the country’s ranking has moved up by 19 spots — evidence to the solid performance of the sector so far. The LPI measures the state of trade and logistics based on parameters like customs, infrastructure, international shipments, logistics quality and competence, tracking and tracing, and timeliness.

In the future, warehousing and logistics are likely to find a good foothold in emerging urban and semi-urban centres. Developers and several foreign private equity players are now making forays into warehouse developments across Indian cities, coming up with large-scale, high-tech warehousing/logistics spaces with stateof-the-art facilities. The relatively easier availability of land in Tier-II and III cities compared to the larger metros, along with improving connectivity through infrastructure developments, make for a winning combination in these cities.

“Tier 1 and 2 cities pose cost advantages, lesser salary expectations and lesser price fluctuations to many businesses which are initiating a shift to these cities. In smaller towns, the proximity of various companies with each other gives rise to clusters, which results in the development of a specific location, aiding smaller companies in market-

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cover story By designing effective supply chains around MMLPs, i.e. stocking levels, distribution levels, speed, accuracy, and by collaborating with a wide base of customers and service providers LSPs can ideally leverage opportunities.”

Abhik Mitra, CEO, Spoton Logistics Pvt Ltd

ing and in finding the right customer.

For developers, the return on investment is higher and much more stable as compared to in the metros. MMLP’s in Tier 2 and Tier 3 cities will make goods available for consumptions – the right SKU (Stock Keeping Unit)s at the right place and at the right time. MMLP’s will be strong enablers of driving demand and growth along with greater purchasing power with greater inter-

insights on part of all the stakeholders involved. The larger the scale, the better the efficiency and all of it results into an enhanced bottom-line. So in this regard MMLPs are here to serve as enabler of profits to all its patrons.”

Definitely, by developing MMLPs, the government can bring in a sea change in the way the logistics business is being handled currently. MMLPs can also

• Rental charges of the use of Warehousing facilities, office space and other facilities that the MMLP developer will provide within the logistics park.

• Terminal handling charges for the use of handling equipments (cranes, forklifts and other heavy machinery) that the logistics provider will use at the park.

• There are other miscellaneous earn-

MMLPs are large facilities and needs cooperation and strategic insights on part of all the stakeholders involved

net penetration,” asserts Abhik Mitra, CEO, Spoton Logistics Pvt Ltd.

bring many benefits to the government.

These can be summarised below:

Benefits of Multimodal Logistics Parks Here, Sandeep Chadha, outlines the inter-crucial ties. “Government needs to incorporate concerns of all the stakeholders involved in planning an MMLP in a particular market. Be it PPP or private route, a well strategised MMLP will not only facilitate ease of doing business, it will bring down the costs significantly. MMLPs are large facilities and needs cooperation and strategic

Direct Revenues: As a multimodal logistics park developing agency, the government will be entitled to collect the usage charges by the perspective customers of this service. Some of the revenue sources from the MMLP are: • Rail terminal access charges for the use of terminal facilities by the logistics providers or container operators.

• Rental charges for the space which has been leased/rented by various users of the MMLP.

28 CargoConnect - august 2018

ings that the MMLP developer will earn as a result of advertisement, leasing/rental of residential properties and other value added services.

• Value added services that bring competitive advantages to the companies would be widely accepted and will be a strong revenue stream.

Indirect Benefits: The development of Multimodal Parks can be of great help in reducing the said costs for our country. This is because MMLPs will push for the right choice for the modes as it gives the right balance of all the

cover story Success of multimodal logistics park depends largely on sharing of resources between different entities. Competition always keeps entities apart. Co loading, sharing of warehouse space, etc. will definitely enhance the success of any multi modal park.”

M S Sajithsivan, COO, Hyundai Glovis

modes and services at one place. In other words, MMLPs will promote the optimal modal choice by the operators.

Thus the indirect benefits can be summarised as below: • Helps in the balanced growth of all the modes of transport.

• Helps in optimal modal choice.

• Helps in proper utilisation on assets like railways or other modes of transport.

• It will motivate the government to create more freight corridors and integration of multimodal transport network.

Defining synergies amongst all the involved beneficiary parties, Viral Shah says, “As the MMPL’s developing agency, the Government of India will be the biggest beneficiary. Government will have direct revenues (and profits) through collection of charges from sources like rail terminal access charge, rental charge for space given out to various users of MMLP, rental charge for usage of warehouse facility, and terminal handling charges.

The various service providers like transportation companies, warehousing companies, freight forwarders, will be

FREIGHT SUPPORT

able to lease space in MMLPs and treat the same as their branch/depot. This branch/depot will act as profit center, where the sources of income and thereby profits will be measurable.

Real estate developers can develop and lease/rent residential properties and treat MMPLs as their project, by which it will be treated a standalone profit center.”

Other Socio-economic Benefits: Transport sector play a vital role not just in the movement of goods - from manufactures to end users, but also in the life of the common people. It directly

Hubs likely at Vijaywada, Nagpur, Bengaluru, Surat, Hyderabad and Guwahati

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2 lakh crore to be invested in multimodal logistics parks

Hubs will be built on state govt land on PPP mode

Parks would help private cos reduce warehousing costs Ministry wants infrastructure status to the parks with 100% FDI

30 CargoConnect - august 2018

Logistics parks will act as freight aggregation and distribution hubs and enable long haul freight movement

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cover story This gradual shift from unorganised to organised means the industry is ripe for investment from global and Indian institutional investors. As is evident, the sector is setting a hot pace that won’t slow anytime soon. How it responds to the various opportunities before it is the key. It’s time for bold investments and decisions.”

Rajesh Jaggi, Managing Partner, Real Estate, Everstone Group

and indirectly affects the general life. By promoting MMLPs in the country, the government can bring in sea change in the life of the common man and both local and national economies. Some of the socioeconomic benefits to be facilitated by MMLPs are listed below: • MMLP will create direct jobs at the local level and thus bringing the economic stability in the life of people.

• It would help in shifting the goods movement from road to rail and thus help in pollution control which will be beneficial to the environment.

• It would cater in the upliftment of the local economy, as it can promote the growth of other type of businesses which is not directly related to the MMLPs. Thus it will also create indirect job opportunities for the people.

• Since it would also promote the development of more freight corridors, thus it will help in the economic development of secondary Project Influence Area (PIA).

For the Logistics operators and general industries: For the multimodal parks to succeed it is necessary that logistics operators and industrial units derive the benefits by using it in the first place. For this, there is a great need to make these types of facilities more lucrative for the perspective users.

Fortunately, around the world MMLPs are giving so many direct and indirect benefits to the users that the respective government is establishing more and more multimodal logistics park around those countries. Some of the benefits are mentioned below: Cost Saving: MMLPs can help in saving of cost in transportation. In other

32 CargoConnect - august 2018

words these services help in the reduction of costs which are incurred in the transportation of goods. This is possible because of use of right modal choice for the movement.

Reduced Transit Time: One of the main features of MMLP is that it reduces the transit time of the goods. Thus, reducing the inventory cost both for logistics

Transportation companies, warehousing companies, freight forwarders, will be able to lease space in MMLPs and treat the same as their branch/ depot, which will act as profit center, where the sources of income and thereby profits will be measurable operators as well as for the ultimate user of the transport mode.

Scope of Additional Business: Due to the reduced transit time, MMLPs can enable the logistics operators to look into more businesses or additional business, thus offering profit maximisation.

Discount for Manufacturers: As MMLPs allow the logistics operators to look for additional business, the manufactures and end users (including exporters & importers) can demand for the concession in the charges for the transportation of their goods by the logistics operators.

Proper Utilisation of Assets: It helps in the proper utilisation of assets as the transit time is less and the goods vehicles and the other hardware are free to use for the other business or purposes. Thus, per unit cost of the transportation of goods can be reduced considerably.

Processing & packaging units: As MMLPs are designed to provide processing & packaging units and food processing units along with various value added services, the same can be used by the manufacturer for reducing the cost of transport.

Benefits of Price Mechanism: One of the main benefits of MMLPs is that it can help the manufacturers, exporters and importers to take benefits of price mechanism. This can be possible due to the presence of cold storages, warehouses, go-downs, open stockings yards, etc.

“Success of multimodal logistics park depends largely on sharing of resources between different entities. Competition always keeps entities apart. Co-loading, sharing of warehouse space, etc. will definitely enhance the success of any multi modal park, “says M S Sajithsivan, COO, Hyundai Glovis.

How to leverage opportunities?

Creating a vision for the logistics sector in the long term and formulating action steps for achieving this vision and creating a conducive environment for growth of the logistics sector with identifying programs to address all aspects, the formulated National Logistics Policy must go well beyond.

While the State will take the lead in putting the National Logistics Policy in place, it is the responsibility of other stakeholders to contribute to the fram-

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cover story ing and implementation of this blueprint and utilising every vital aspect of it. Scoping and governance of the policy would be crucial for its successful implementation and functioning.

About MMLPs and how would they aid to the business of a Logistics Service Provider, Sandeep Chadha presumes, “In terms of leveraging opportunities, the incumbents need to ascertain the demand carefully and then offer the best possible solutions to it. It is difficult to state the exact amount of leverage, but demand is there and also potential, and all of it combined will augur a better playing field to all the players involved.”

“By designing effective supply chains around MMLPs, i.e. stocking levels, distribution levels, speed, accuracy, and by collaborating with a wide base of customers and service providers LSPs

A hopeful Vikas Yadav says, “MMLPs would provide opportunities for integration of IT to reduce costs incurred, world class transportation network and world class storage and warehousing facilities. These, combined with favourable government policies like implementation of GST and boom in economic activities would provide the requisite growth environment for LSPs.” “LSPs will typically take time to get used to the MMLPs environment, as LSPs will require making internal changes with regards to structures, processes, investments, IT systems, etc. to leverage opportunities from MMLPs,” connotes Viral Shah, with implicating the necessary steps to be taken by an LSP. Future strategy Thus, it can be said that Multimodal Logistics Parks just not only bring in

They are an indispensable part of industrial infrastructure development and will help reduce logistics costs and guarantee continuous and stabile supply chains.

As mentioned by Rachid Fergati, “The International Monetary Fund (IMF) has reaffirmed that India will be the fastest growing economy in 2018. To push growth rates even higher, will require modern and well-functioning infrastructure - developing technology tools, along with managing order visibility, quality of service, timely supply, delivery and clearances.”

“This gradual shift from unorganised to organised means the industry is ripe for investment from global and Indian institutional investors. Automation, robotics and supply chain management systems will increase management ef-

MMLPs would provide opportunities for integration of IT to reduce costs incurred, world class transportation network and world class storage and warehousing facilities can ideally leverage opportunities,” says Abhik Mitra.

Also, on the flipside, “A non partial entity like an LSP will be more successful in bringing together competing companies for scaling up the usage of different facilities offered to keep the cost lower,” states M S Sajithsivan.

While, incorporating information technology, regulation, human resources, and skill development are equally important for the entire stakeholder community. This will give flexibility to service providers to exercise control over critical processes that require roundthe-clock monitoring from anywhere.

34 CargoConnect - august 2018

all around development in the economy but it can also act as a profit center for all the parties involved, allowing each to effectually leverage opportunities. It not only facilitates cost savings, provides greater access to resources, manages funds better, reduces inventory and transaction costs but also helps share risks and aligns growth strategy with the users. It can enhance the volume of rail freight in the overall transport chain of the country with complete solutions to help companies reduce both the cost and time of transporting goods. Moreover, it can propose the concept of reliability, security, and speed in doing business more forcefully.

ficiencies, even as drones and self-driving vehicles are introduced to support seamless operations. As is evident, the sector is setting a hot pace that won’t slow anytime soon. How it responds to the various opportunities before it is the key. It’s time for bold investments and decisions,” concludes Rajesh Jaggi.

However, immediate problems, such as an inadequate roads and losses during transportation, must be resolved.

Improvement of road infrastructure at a much faster pace is critical to minimising losses, both economic and environmental. Only when this happens on the right scale, the logistics sector will achieve optimal growth.

special feature

Air v/s Sea Freight: Making the Right Choice Choosing the mode of transportation – air, rail, sea or road, for the movement of cargo is one of the most important decisions that a freight forwarder has to make considering various factors like cost, speed, reliability, transparency, environmental impact, etc. Ritika Arora Bhola talks to experts regarding the fundamentals of air and sea freight as two major modes of transportation, similarities and differences between the two and which is better, and why?

36 CargoConnect - august 2018

special feature

I

f we go by the reports, from the last few years, Indian logistics industry is witnessing tremendous growth and development. As per the Economic Survey 2018, Indian logistics industry which is worth around USD 160 billion is likely to touch USD 215 billion by the year 2020.But, when it comes to choosing the mode of transportation – air, rail, sea or road, for the movement of cargo, freight forwarders still consider various factors like cost, speed, reliability, transparency and environment impact.Therefore, choosing the right mode of transportation becomes very important for a forwarder as he has to keep in mind the value of the goods being shipped, urgency of the shipmentas well as the weight and size of the cargo. If we talk about international shipping, both shipping industry and air cargo industry is growing at a rapid pace and both sea cargo and air cargo have their own pros and cons like certain products like perishables cannot be transported via ship as the dwell time is high as compared to air freight.

Similarly, heavy machinery, automobiles etc., cannot be moved via air because of heavy weight and size.

Also, cost, speed and dwell time differs largely if we compare the sea freight and air freight. However, now, experts believe there’s not much difference left between these two modes of international shipping – air and sea.

august 2018 - CargoConnect

37

special feature They say, “Ocean freight (OFR) and Airfreight (AFR) both complement each other. It is not about one being better than the other. For example: if a customer has a production/quality issue and this has resulted in the delivery schedule being impacted, then by default the mode becomes AFR. Likewise a customer has inventory piled up and does not need fast delivery, but requires the inventory to come in at a later date then they can switch to OFR. Both modes of transportation are generally used based on the need.

Obviously, airfreight is used for speed and ocean freight for moving large quantity. One mode shall never replace the other.”

Modes of transportation serve a purpose and you can’t really say which is better.

Land transportation also becomes a large part of the logistics industry. They are all critical components of world trade. The choice depends on the need: time/ cost/distance of capital/consumer demand.

Ram Menen Independent Director, International Board of Expofreight (EFL) Observing the above, veteran freight forwarder, Ram Menen, Independent Director, International Board of Expofreight (EFL) compares the two and says, “Modes of transportation serve a purpose and you can’t really say which is better. Land transportation also becomes a large part of the logistics industry. They are all critical components of world trade. The choice depends on the need: time/cost/distance of capital/consumer demand. In a new product launch, initial inventory uses air cargo, second batch by sea and air and larger inventory by sea. This way one is able to use transportation as a floating warehouse and avoid inventory holding on expensive land-based warehouses. Just in time supply chain operations, especially for components and stuff, tend to prefer air as inventory

is only produced on demand. Low value, high volume (quantity) commodities like grain, coal etc., are sea captive.

Mainly the overall science of supply chain management/operations dictate the choice of mode of transportation based on deriving optimal cost efficiency based on the market demand and customer services requirements.

Evolving e-commerce/e-tail activities tend to be air captive as customers want fastest possible delivery times from the e-tailors to their door step.” On a similar note, Sandeep Nair, Senior Director - Ocean Freight, DHL Global Forwarding and N. Kutty, Senior Director - Airfreight, DHL Global Forwarding avow that both modes are important and have their own benefits and one mode can never replace the other.

Agreeing with all, expert in the domain, Bharat Thakkar, Joint Managing Director, Zeus Air Services Pvt Ltd asserts, “Both the modes of transportation are important and complement each other. However, time sensitive, time-bound and valuable cargo usually moves via air.”

In the interim, Ashutosh Dixit, CEO, DAMCO (India, Sri Lanka & Bangladesh) opines, “Choosing the right mode of transport can often be

Air vs Sea freight: Which is Better?

1

1

It is suitable for wide range of products with long lead times

2

Large volumes. A single, ultra-large container ship can carry +/-20,000 twenty-foot equivalent units (TEU)

6 Multiple carrier options for the shippers

Quick transit

Sea Freight: Key Benefits

2 Less handling of cargo

5 Enhanced level of security for your cargo

Air Freight: Key Benefits

3

Most environmental friendly among all the modes of transport

5

Extensive coverage around the world

38 CargoConnect - august 2018

4

Economical. Liner shipping is the most efficient mode of transport for goods

4

Reliable arrival and departures

3

Less documentation

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special feature Both modes of transportation are generally used based on the need.

Airfreight is used for speed and ocean freight for moving large quantity. One mode shall never replace the other.”

Sandeep Nair Senior Director – Ocean Freight, DHL Global Forwarding tricky with safety, cost and time being the main points of consideration.

Increasingly there is also a growing consciousness among shippers to simultaneously attempt at reducing the carbon footprint resulting from their shipments. This is a shift in the right direction and ties-in perfectly with Maersk’s global objective and initiatives to support the ecological preservation of our water bodies.”

Citing the facts, Dixit continues by saying, “By the end of 2016, we have reduced emissions per container moved by 43 per cent since (baseline 2007).

We continue to pursue the target of a 60 per cent reduction in CO2 per container moved by 2020. In Singapore, around 40 people -many of them seafers- work in the Global Vessel Performance Center, engaging with crews on the approximately 600 vessels operating in ML´s fleet, optimizing voyages in terms of full efficiency.”

He further adds, “In connection with this, it may interest you to know that maritime shipping as a mode of transport, is actually the world’s most carbon-efficient form of moving goods far more efficient than either road or air transport. While ocean freight currently moves 80 per cent of the world’s

trade, the CO2 emissions from this is minuscule when compared with air freight. Having said that, at Maersk, our counsel to our customers on this matter also takes into account how quickly the goods need to reach their destination and the most cost-effective solution that

on digitizing the entire shipping value chain to positively impact every point of engagement between the shipper, the consigner and the consignee, have made a strong start with the launch of our Twill platform earlier this month. Twill is an easy-to-use digital platform which provides customers greater control of their shipments by offering instant price quotes and bookings, transparency and tracking, simplified paperwork and proactive customer care. Pioneered from India, which is one of Maersk’s key growth markets, this service is expected to be extended to 15 more countries in 2018.”

Observing the same, veteran freight

Both modes offer different options to customers in terms of Routing, Price, TAT, and on various service providers. The documentation processes have similarities but are not exactly the same.”

N. Kutty Senior Director - Airfreight, DHL Global Forwarding can be worked out for the customer.

To this end, we are working tirelessly

Despite high prices, a forwarder cannot rely on ships to transport priority cargo like perishable products

forwarder Samir J Shah, Partner, JBS Group of Companies also articulates, “We cannot be comparing apples with oranges. While both meet the same need - i.e. to get cargo from one place to another. The mode of transport is dependent on a number of factors like volume; nature; destination point; time limits; geographical parameters etc. These would govern the mode of transport. There cannot be a direct comparison of the two.”

Factors to Consider Before Choosing the Mode of Transport: – Sea or Air? 1. Cost Cost is one of the very important factors which freight forwarders consider before choosing the mode of transportation for moving several tons of cargo from one destination to another.

Usually, sea cargo is less expensive as compared to the air cargo. Also, the cost difference between sea freight and air freight depends on the trade and the cargo you ship.

40 CargoConnect - august 2018

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special feature Both the modes of transportation are important and complement each other.

However, time sensitive, time-bound and valuable cargo usuallymoves via air.”

airfreight is considered a less intrusive mode of transport with lower risk of damaging cargo when compared to sea freight.

4. Environmental Impact Bharat Thakkar Joint Managing Director, Zeus Air Services Pvt Ltd According to the Transport Intelligence,the air freight usage is growing slowly, with less than one per cent growth in 2015. The International Air Transport Association (IATA) recently stated that air freight growth only hit 2.2 per cent in 2015, down from 5 per cent in 2017. “One reason for this is increased reliance on ocean freight, which is growing more and more reliable. Ocean freight has been getting cheaper, driven by massive ocean freight overcapacity, with up to 75 per cent declines on key routes. On the other hand, air passenger travel

2. Speed Speed is another important factor to consider because in today’s time with the growth of e-commerce, last mile delivery has become significant, customers prefer fastest delivery of products at their doorsteps. When it comes to speed, air cargo is preferred as it takes 1-2 days while ships take 7-12 days or sometimes weeks to move cargo.

Also, despite high prices, a forwarder cannot rely on ships to transport priority cargo like perishable products, flowers and newspapers to name a few, he prefers air.

Every business house has a responsibility towards the environment too; to make sure their business operations are not affecting the environment in any way.

When it comes to impact of operations on environment, ocean freight wins this category. CO2 emissions are much higher in air freight as compared to the ocean freight. This also leads to larger carbon footprints on air cargo than sea cargo.

5. Transparency Transparency is one of the primary reasons why many companies prefer air over sea. Airlines provide complete cargo tracking facilities to their customers – mobile apps and websites to monitor the cargo, while this option is not available in the case of sea. Tracking specific location of the containers on the ocean is almost impossible until the vessel is near the port, but you will need to obtain this information from your carrier directly.

Similarities and Differences According to Menen, “Air, sea and land transportation are very important and integral part of the trade process.

They are in fact the wheels of the trade and commerce vehicle. Without distribution and transportation, world trade will grind to a halt. Generally, the operational processes, handling as well as border control, are very similar with slight variations.”

has grown strongly, pushing carriers to create more and more planes. As a result, there’s more belly cargo space.

However, this means that less than half of air freight capacity is being used. The result for air cargo shipments is that most companies that need to import do everything in their power to take advantage of cheap ocean rates, leaving only the most urgent shipments for air.”

42 CargoConnect - august 2018

3. Reliability Reliability is something on which business depends largely as it provides a sense of satisfaction to the forwarder as well as the customer. Often the reliability of transport can outweigh other factors such as cost and speed. When operations are reliant on the delivery of goods it becomes paramount that goods arrive on time and in good condition.Usually

While Thakkar suggests, “the cost difference between sea freight and air freight depends on the trade and the cargo you ship. As the airplane capacity is typically limited by weight and these freight capacity by volume, the difference in price for sea freight and airfreight is less for light cargo than it is for heavy cargo.Typically, you will hear that shipping by ocean is cheaper than shipping by air. With larger and heavier shipments, it is often much cheaper to ship by sea. As a shipment gets smaller,

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special feature Choosing the right mode of transport can often be tricky with safety, cost and time being the main points of consideration. Increasingly there is also a growing consciousness among shippers to simultaneously attempt at reducing the carbon footprint resulting from their shipments.

Ashutosh Dixit CEO, DAMCO (India, Sri Lanka & Bangladesh) the margin between the prices gets smaller and sometimes air will even end up less expensive.”

$1,000 per ton if moved by air. When it comes to green-house gas emissions, the transport sector as a whole is

per container moved and successfully managed to bring this down by an impressive 43 per cent between 2007 and 2016 – a big win for us.”

Shah to ads on by saying, “Both, as stated fulfill the need of moving cargo from one place to another. This is the only similarity. Documentation pattern; documentation requirements; origin handling; destination handling; security; declaration; consolidation; weight restrictions; volume calculations; weight calculations; marking; labelling;

On the other hand, Nair and Kutty pen down the similarities and differences: “Similarities: Both modes offer different options to customers in terms of routing, price, TAT, and on various service providers. The documentation processes have similarities but are not exactly the same. Security aspects that need to be adhered for both the modes are almost the same.

Differences: Speed and Cost; AFR is a faster option but is more expensive, while OFR is cheaper but cannot be as quick as AFR. There are many commodities that cannot be moved

by Airfreight while Ocean freight can transport almost all the commodities.

Quantity of cargo that Ocean freight can transport at one go is much larger than what Airfreight can.”

However, Dixit feels air is faster than ocean transport. “We’ve seen increasing focus of the government in the recent years to create more effectual routes for ocean transport and bring down the time taken to move goods by sea. This also includes investments being made in upgrading canals and improvements being made by shippers in processes related to ocean tracking, all of which is making ocean freight movement more efficient.”

Focusing on the costs he further elaborates and tells that air transport is more expensive. “For example, a shipment being moved by ocean transport can cost around $195 per ton while the same can cost upto

44 CargoConnect - august 2018

While ocean freight currently moves 80 per cent of the world’s trade, the CO2 emissions from this is minuscule when compared with air freight

responsible for 23 per cent of global energy-related emissions. Shipping however, is responsible only for 3-4 per cent of this. Air transport on the other hand, is a significant contributor to air pollution given increasing volumes of air travel across the world. A case in point is the increase the European Union has seen in green-house gas emissions from the aviation sector which increased considerably by 87 per cent between 1990 and 2006! As a socially responsible corporate, Maersk has been working relentlessly towards reducing emissions

stowage; certification all are different dependent on mode of transport and the nature of the cargo. It is interesting for one to learn both types of cargo transportation and to be able to understand the differences.”

To Sum it up According to the veterans of the logistics industry, both shipping industry and airfreight industry have seen major growth and revolution in the last few years and have marked its presence globally. With the growing exposure, whopping investments in latest technologies and infrastructure – both airfreight and sea freight industries have managed to deliver the excellent services to the customers.

Nair and Kutty share some of the important milestones that ocean and airfreight industries have achieved: OFR Industry: • Shipping lines have experienced consolidation over the last few years and this means lesser options for us and our customers

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special feature The mode of transport is dependent on a number of factors like volume; nature; destination point; time limits; geographical parameters etc. These would govern the mode of transport. There cannot be a direct comparison of the two.”

Samir J Shah Partner, JBS Group of Companies • Having said that, supply is still high with most services having a higher capacity than demand • Higher capacity and lower demand leads to rates sliding, and we witnessed this during the first quarter of 2018 • With most carriers expecting larger vessels being delivered over the next 1 to 2 years, and some even placing new orders, there would be pressure on rates unless the demand moves up significantly

in technology and its effect on manufacturing process. ” However he is not very optimistic about the sea freight industry and its growth and predicts containerized shipping to be worst affected. He whines,“As inventories, both at pre-

electronics are all getting shorter and shorter. Wholesalers and retailers do not want to hold large inventories because of the perishability of demand.

So, the shift to air is likely to erode the traditional volumes. Sustainable energy production is now reducing the dependencies on the traditional commodities like coal. Hence, this will also have an effect on traditional volumes. Containerized shipping is likely to be worst affected.”

With a different perspective, Shah concludes by saying, “Both modes of transport are developing with many new dimensions. The introduction of AFS as a parallel to CFS is interesting and one needs to see how the same

AFR Industry • Airfreight industry is poised to be in high demand for the coming period. This is because the e-commerce business is taking away large amount of capacity from the commercial airlines.

• E-commerce demands faster turnaround of these shipments, and are willing to pay higher freight rates as well. This capability of e-commerce also comes from moving shipments from shippers to customers directly and thus minimizing the cost of multiple staging warehouses in the supply chain • This drive will compel similar behaviors from customers in retail and fashion and electronic industries, choking the available capacity. With no additional freighters seen in the market the capacity could remain almost the same increasing the demand for capacity thus causing freight rates to rise • The growing world economy can also contribute to this situation Meanwhile, focusing on growing e-commerce industry, Menen articulates, “The air cargo industry will be a good growth area. Evolving e-commerce activity will continue to fuel the growth of air cargo in double digits for the foreseeable future, however, the traditional cargo movement is likely to slow down to low single digit growth because of evolution

46 CargoConnect - august 2018

production/manufacturing and fully finished goods are likely to move in smaller quantities and more often.

Life cycles of goods from fashion to

When it comes to greenhouse gas emissions, the transport sector as a whole is responsible for 23 per cent of global energy-related emissions

develops. Additionally the new concepts in Customs clearance like e-sealing; direct port delivery; direct port export ; deferred payment of duty etc presently offered in Sea Cargo must be offered urgently to Air Cargo also.

Carrier consolidation seen in Sea cargo is not reflected in Air cargo since most of the cargo is belly cargo and the airline industry is still driven by passenger requirements. It is also expected that true multimodal transport both within India and internationally will be the future. Sea-Air and Air-Sea are not new concepts but need to be used more and offered as a regular service by the Forwarders. The future remains exciting and interesting.”

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feature

E-way

bill

reducing turnaround-time of trucks Indian logistics sector recently witnessed the pros and cons of the E-way bill. On one hand, ICRA’s survey show us the bright side of the E-way bill estimating that by digitisation of the process operational efficiency of transporters has increased significantly. While on the other hand, 90 lakh trucks across India went off road, between 20-28 July, protesting against lack of adequate IT infrastructure and SOP for handling inadvertent errors in the E-way bill. Gaurav Dubey presents a short report on the recently rolled out developments of the E-way bill.

48 CargoConnect - august 2018

feature

T

here is no denying the fact that the logistics industry in India is expected to grow rapidly under the Goods and Service Tax, and E-way bill - an important pillar of the GST regime. The significance of E-way bill system is paramount for both Union Government and the Logistics industry. The government is concerned about improving GST collections and the industry is expecting fruitful measures from the government regarding administrative issues, which include processess to be followed if portal encounters technical snags and vehicles are subjected to verification. Industry stakeholders hold the view that meticulous planning is essential and IT system should be enhanced to handle compliance issues as any lapse could breakdown the entire supply chain.

E-way bill has propelled logistics efficiency to the next level. It has been proven recently by the released figures of ICRA’s(Investment Information and Credit Rating Agency) survey conducted on leading 50 transport companies of the country.

Transporters gave a thumbs-up to the E-way bill in the survey and digitisation which has tremendously reduced paperwork and reduced their operation time significantly. “The overall impact of E-way bill has been positive. The full benefit of GST on the road logistics sector is expected to be realised over the longer term,” said the ICRA’s report.

The report also highlighted the significance of having a GST E-way bill software for all the transportation and supplying of goods as it will help in compliance of registration, E-way bill generation, bulk printing and much more. Gen GST software is considered to be the top rated GST software for the requirements of E-way bill provisions.

The e-way bill is saving both time and money of transporters. The survey also found that truck productivity has increased august 2018 - CargoConnect

49

feature The pace at which E-way bill application is launched and the pace at which automation is happening are not in sync.

So, I reckon there is an urgent need to automate for smoothening the system”

Raghavendra Rao Manda Head Logistics, Kohler Kitchen and Bath India

Further, nearly half of the consumer-centric companies surveyed by ICRA stated that their warehouse networks continue to remain fragmented, with some others said to have been considering plans to redesign their distribution networks.

The FMCG sector was slow in consolidation, due to the fact that decentralised distribution systems are critical for those products and for effective customer services. Manufacturing segments backed with better demand forecast have made considerable progress in centralising warehouse operations.

How E-way bill is improving efficiency of Indian logistics sector? remarkably, following the disruption of interstate border checks that previously aggravated turn-around-time of trucks and intensified driver idle time issues.

“As per ICRA estimates, so far there has been about an 18 to 20 percent improvement in [truck] turnaround time because of GST. The impact has been better pronounced in a few states, such as Kerala, West Bengal, Maharashtra, Madhya Pradesh, and Bihar, which were earlier known for notoriously high waiting time spent at their inter-state borders,” the report highlighted.

Minimum paperwork Paperwork has reduced significantly for transporters after rolling out of E-way bill. Previously, transporters had to undergo the tedious task of preparing documents separately for each state through which their trucks had to pass for delivering goods. Now, under the E-way bill regime only a single document is sufficient for a single consignment moving through different states.

As per ICRA estimates, so far

For example, to move goods from Jaipur to Bangalore, taxpayers only need to generate one e-way bill, even though the goods must pass through several states before reaching their destination.

ICRA’s report also said that transporters’ there has been about an 18 compliance rates with a centralised to 20 per cent improvement electronic billing mechanism for GST, in [truck] turnaround time Faster turnaround time which took effect on April 1, have been because of GST As mentioned above, ICRA’s survey remarkably good, with two-thirds of the stated that turnaround time of trucks has companies that participated in the survey reduced up to 18-20 per cent which in turn reporting more systematic/streamlined has improved logistics efficiency. Removal of state borders and operations. Although initial system glitches were a cause of national check posts have contributed in faster and smoother worry for some companies, digitisation has substantially movement of goods. Vehicles can’t be detained by authorities reduced the amount of paperwork that logistics providers had until and unless they have some specific information of goods to handle, the agency’s report stated. moving in the truck. If a vehicle is detained for more than 30 However, the survey states that not any major warehouse minutes, it has to be reported. consolidation trend has been witnessed in the post-GST period Transportation cost will move southwards which was largely expected. “While logistics efficiency is If trucks will move fast on highways or on roads then fuel certainly a key factor influencing the location of warehouses, consumption will automatically decrease and it will lead in other sector-specific nuances have also influenced the extent reduction of other transportation-related costs also. and pace of consolidation in each sector,” ICRA stated.

Validity of e-way bill Type of conveyance

Distance

Validity of E-way bill

Less than 100 km

1 day

Every additional 100 km or part thereof

Additional 1 day

Less than 20 km

1 day

Every additional 20 km or part there of

Additional 1 day

For standard sized cargo

For over dimensional cargo

50 CargoConnect - august 2018

Air Freight Forwarders & Consolidaters

HO : 2 E & U, DCM Building, 16, Bharakhamba Road, Connaught Place, New Delhi-110001 T: + 91.11.47343502-16 F: +91.11.47343501 E: info@perfectexpress.in W: www.perfectexpress.in OUR BRANCHES: MUMBAI, CHENNAI, BENGALURU, HYDERABAD, KOLKATA, AHMEDABAD

feature Previously, E-way bill was required prior to the movement of goods. Now as per recent updates in the rules, the E-way bill could also be generated after the commencement of movements of goods if goods are being moved through Railways, Waterways or Airways

If goods are being delivered by railways then there would be no need to generate the E-way bill. However, according to the rule number 138(2A) of CGST, the recipient has to show E-way bill in order to receive delivery of goods through railways After submission, details filed in Part A will be valid for a period of 15 days and in the meantime Part B could be updated in form GST EWB 01

If goods have been verified once by the tax officer in a state/UT, the same shall not be inspected again, until and unless some specific information is received to check the goods

If goods are transported for a distance up to 50 km within the state or UT from the place of business of consignor to the place of business of transporter for further transportation then supplier/recipient/ may not require to furnish details in Part B of form GST EWB 01. Still, Part A of the form has to be filed. Previously, this limit was of up to 10 km, now it has increased to 50 km

Important updates

in E-Way Bill

If a transporter is carrying multiple consignments and the value of each consignment is less than `50,000 then he is not required to generate E-way bill

A transporter could also generate Part A of the E-way bill on behalf of the supplier, on a condition if the supplier authorises the transporter to do so

If goods are being transported up to a distance of 20 Km from the place of business of the consignor to a weighbridge for the weighment or from weighbridge to the consignor’s place with subject to the condition that the movement of goods should be accompanied by a delivery challan. In this case, the E-way bill will not be required

52 CargoConnect - august 2018

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feature Any technical snag in the E-way bill mechanism could bring the complete business to a halt, as no movement of goods above Rs. 50,000 can take place without a corresponding E-way bill. So, the mechanism needs to be strengthened further.”

Anand Bhadauria Senior General Manager – Procurement and Supply Chain, OSRAM India

Warehouse consolidation In the post-GST era, companies are placing big mother warehouses in strategically important locations to reduce their logistics cost. Goods are now flowing freely from state to state and logistics companies are making most out of it. Previously, companies were bound to maintain warehouses in every state to maintain their profitability and bypassing different tax systems of different states.

But where E-way bill is lacking?

change their mode of transportation often for delivering a single consignment. The industry stakeholders are expecting some solutions from the government on this front so that full potential of E-way bill could be realised.

Full benefits could be evaluated only in the long run As per ICRA, the full benefit of efficiency improvements and cost reductions from a large-scale reform program — such as the GST — could be realised and seen in figures over a longer period.

“About 10 per cent of the transporters indicated that their overall costs have reduced post-GST implementation, while more than 40 per cent suggested that costs were increasing.

Higher compliance costs related to GST, due to technological upgradation, up-skilling of workers, and penalty charges, etc. have added to the cost-burden of transporters, which, coupled with increasing diesel prices, have taken a toll on their profitability,” the report further stated.

E-way bill comes with a time limit; hence, it has reduced the turn-aroundtime of trucks to a significant extent”

ICR A sa id not w it h sta nd i ng t hose short-term, mixed results, faster truck turn times, along with more organised, combined warehouse networks, will increase supply chain efficiency and decrease logistics costs in the long term.

IT arm needs to be strengthened The entire mechanism of E-way bill is being driven by technology and small transporters are not tech savvy like other big transport companies. There is fair amount of chances These findings support a previous GSTBhavyaash Agarwal that they might not have the requisite IT related analysis by the Ministry of Road Director, Karga India Roadways infrastructure to generate E-way bills. Poor Transport & Highways, which concluded internet connectivity in tier III and rural that with the simplified tax system, longareas are also a major cause of concern. Any technical snag haul truckers are able to cover 300 to 325 kilometers (186 with the GST Network could bring the complete business to to 202 miles) a day, compared with an average distance of a halt, as no movement of goods above `50,000 can take place 225 kilometers a day in the prior period. According to the without a corresponding E-way bill. recent study, more than half of the participant companies in the survey have completed warehouse consolidation. The Smaller transporters expenses might increase remaining are in the process of consolidation, while some Transportation cost will go down undoubtedly for the have hired services of supply chain management companies transporters, but it may increase other expenses for smaller for setting up an efficient warehouse network. transporters as they have to invest in proper IT infrastructure and employ personnel skilledin generating E-way bills.

If the potential of the E-way bill system is realised completely then it can offer a range of effective and strategic benefits to the logistics industry of India. Introduced as a mean to alleviate tax evasion – the E-way bill system can give us a clear picture of value of the goods moved within or outside a state. This could also bring informal transactions under the umbrella of formal economy. Strategically, this system can also provide valuable data about the value of goods moved within and across states thereby indicating levels of regional intensity and economic growth levels. With targeting the sector’s one of the biggest inefficiencies, this system will also add in disillusion of state borders and reduce the amount of time wasted at New E-way bill on changing mode of transportation state border checkpoints. In addition, once RFID technology Multiple bills needs to be generated for a single consignment if is implemented, transporters will not be required to carry mode of transportation is getting changed in the supply chain. physical copies of an E-way bill, which will be synchronised This would increase workload specifically for E-commerce and verified through the device itself. This will facilitate easier, retailers and courier industry personnel as they have to faster and cheaper movement of goods.

54 CargoConnect - august 2018

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AUTO20

CONNECT 18 Automotive Logistics Conference

15th October 2018 | JW Marriott, Pune

India’s largest gathering of the AUTOMOBILE LOGISTICS PROFESSIONALS

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MANDEEP WALIA ANAND VENKATESWARAN KALPESH PATHAK Head - Supply Chain Senior General Manager VP- Purchase and SCM, Management and Logistics Sales Logistics Fiat Chrysler Automobiles MAN Trucks India Hyundai Motor India Ltd

ADITYA SHAH Executive Director V-Trans India Limited

XAVIER BRITTO Chairman Kerry Indev Logistics

JITEN MUNOT Head Sales Admin & Logistics Force Motors

SUSHIL RATHI Chief Operating Officer Mahindra Logistics Limited

VIPUL NANDA President Car Carrier Association

AKASH BANSAL Country Head- Logistics Om Logistics Limited

NIDHISH KUCHHAL General Manager Mahindra & Mahindra

PRABHU NITHYANANDHAM JAYAPRAKASH LOGANATHAN MINISTRY OF RAILWAYS ACHAL PALIWAL Senior Manager Chief Executive Officer - General Manager, Asia Pacific General Manager Logistics and Customs J.K Fenner (India) Ltd TMLD Co. Ltd (Confirmed participation) Ford Motor Pvt Ltd Tata Motors

Ajeet Kumar: + 91 9810962016, ajeet@surecommedia.com, Smiti Suri: + 91 9711383365, smiti@surecommedia.com Mehuli Choudhury: + 91 9810730347, 8700292866, mehuli.surecommedia@gmail.com Rahul Arora: + 91 9899211616, rahul.surecommedia@gmail.com

OBJECTIVE To contribute towards the promising future of the Indian automotive supply chain by bringing together all the stakeholders of the automotive logistics industry under one roof and creating an excellent networking and knowledge sharing opportunity for the attendees.

KEY FACTS Total Delegates: 250+ from across the globe.

Great participation from automobile as well as component manufacturing companies, Railway, Ports, Shipping Lines, Logistics Service Providers, Logistics Parks, Warehousing, Vendors & Facilitators for the auto supply chain.

Sponsored by leading brands servicing the Indian automotive supply chain.

NETWORK WITH Major car/truck/tractor/two-wheeler companies, LSPs in the business of automotive logistics, Railway companies, Shipping lines, Ports, CFS/ICD, Port terminal operators, Logistics Parks developers, Warehousing companies, Courier companies, Vendors & Facilitators, Government personnel, Skills sector development agencies.

THEME India Automotive Market 2020 India is the 4th largest automotive market by volume in the world.

Over the next 20 years, India will be a part of the global automotive triumvirate - the global BIG 3. In fact, we expect India’s automotive sales to exceed the US market by mid 2030s. The global automotive game will be pretty much decided by twin forces, for both China and India. Automobile exports are also going to play a significant role in the near future.

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This points to the greater need for teamwork and supporting government policies for creating seamless auto supply chains. The need to get updated on new distribution models, what we need to borrow from the west. Megatrends that are going to shape the future are the top priorities for every automotive logistics professional today in India.

AUTO CONNECT is engineered to address this need. Knowledge sharing and networking is not an option today BUT an imperative factor as we need to stay one step ahead by “Transforming Today to Lead Tomorrow.”

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Interview

Operating over 36 offices in India, Sri Lanka, Pakistan, Bangladesh, Myanmar, London, Hong Kong, Madagascar & Mauritius, HTL Logistics covers all aspects of the Supply Chain, from Ocean/Air Freight forwarding to Customs Brokerage, Warehousing, Trucking, and 5 PL. Reyaz Farook, Chairman, HTL Group, in an exclusive interview with Upamanyu Borah, talks about the company’s services, their future plans, the progressive use of information technology, and government’s initiatives to boost the Indian logistics sector.

Upholding their motto “Honesty, Trust, Loyalty” 58 CargoConnect - august 2018

1) How would the recently rolled out E-way bill, grant of Infrastructure status to the Logistics Sector, and GST implementation thrust the business of HTL Logistics in India?

This is a very significant move by the Government of India and will boost ease of doing business as well as cutting down on time taken for delivery of goods, as now we have a uniform tax regime. We would witness in the coming months how efficiently logistics sector gears up to match and exploit the initiatives taken by the Government and further support them.

2) How does HTL Logistics provide

efficient and cost-effective services to its clients? What is the principle Mantra behind delivering your impeccable services?

We have a robust I.T. system and been investing time and money in training our people so that we are able to provide a competitive service. Our I.T. system helps us to cut down unnecessary human interaction which helps us to save time and money for our clients. Our Mantra is to remain focused and align ourselves to the changing business environment.

3) What are your expansion projects in the pipeline which will further align your services?

We are continuously looking for expanding our foot prints and service offerings. We are looking at working closely with our clients and offer them Warehousing and Distribution services.

We feel that there is a tremendous scope in building and supporting infrastructure to complement these services.

4) Do you believe multi-modal logistics can turn out to be the magic pill to change the way cargo is transported, serving as an enabler of business? Do you think promoting containerisation is an essential step?

One size most emphatically does not fit all! At every stage there is a need for customisation, and multi-modal transportation for sure provides a cutting edge. We need to ensure that while handling goods/cargo, there are

minimum transactions in terms of loading and offloading of goods/cargo.

Containerisation thus provides the required support and it also helps to keep goods intact and avoid pilferages.

5)

Being one of India’s Logistics industry giant, what challenges do you foresee in the year 2018?

It’s difficult to forecast challenges. What we anticipate to happen is that there will be a pressure on yields, we would need more professionals to come over and partner with us so that we both gain from each other’s experiences. Operating cost would always be under pressure, trick is to see how one sustains this. We at HTL have been working diligently to keep enhancing our I.T. support along with an able man power at the backend to meet these challenges.

for us to keep going and delivering what our customers are looking for, it will be paramountly important that we keep changing with time and adopt newer ways of doing business

6)

In a span of 35 years, you have successfully built and developed HTL Logistics from the scratch with your clear vision. So, now what is your next big goal you are striving to achieve for your company?

We have been lucky to have some great support from our team members and they are the ones who made this journey possible. 35 years ago, down the line, the way we were doing things and today the way we handle cargo, definitely we have come a long way, to speak of. In order for us to keep going and delivering what our customers are looking for, it will be paramountly important that we keep changing with time and adopt newer ways of doing business. In near future, we would like to be seen as a preferred partner for our clients and among the leading Logistics Company in India.

august 2018 - CargoConnect

59

Interview

Revolutionising, shaping, and simplifying the world of logistics 2) Tell us about DHL SmarTrucking’s exclusives when it comes to offering optimised solutions.

DHL SmarTrucking offers the fastest transit times with 95 per cent reliability, and up to 50 per cent reduction in transit times compared to traditional trucking, along with ease of use, end-to-end consignment visibility, temperature-controlled capabilities and real-time tracking that beats industry standards.

The world’s leading and most efficient logistics company, DPDHL’s broad portfolio meets every logistics requirement – from simple shipping and transportation to transformative solutions that span the supply chain.

Their recently launched DHL Smart Trucking initiative is one such innovative model for inter-city transportation in India with the fastest transit times and most reliable solutions. Neeraj Bansal, CEO, DHL SmarTrucking, DHL India, in a conversation with Upamanyu Borah, elucidates more on the exclusives of the technology enabled fleet, and what it has in store for the Indian market.

Excerpts!

1) What is the measure of ambition behind DHL SmarTrucking?

Our vision is to become leaders in the TechLog – technology-enabled logistics space and to be agile in our offerings. DHL SmarTrucking is committed to pioneering TechLog, or technology-driven logistics in India. With this launch, we aim to revolutionise the Indian trucking industry by bringing together technology with global and local expertise.

60 CargoConnect - august 2018

IoT-enabled sensors monitored through the company’s centralised control tower provide real-time temperature and consignment tracking. Information alerts and status updates are also sent to customers and DHL SmarTrucking’s operations teams through the customer portal and external and internal mobile applications.

Utilising an innovative and agile model, drivers are rotated at predetermined stops located across the country, with the original driver returning to the point of origin with another truckload.

3)

What makes your services different? Are there competitive advantages compared with offerings from other competitors?

While there are a number of companies operating in this segment in India, there is no single player like DHL SmarTrucking in the Indian logistics landscape. DPDHL Group has been in the logistics space for a very long time, so we are amply supported by a global skilled and knowledgeable team that we are able to leverage to enhance our offerings to our customers. This heritage as one of the world’s leading logistics providers with around four decades of India experience gives us an advantage when it comes to understanding the Indian customer and contributing to the logistics sector.

4) Tell us about your future investment plans.

At the moment we are running pan-India operations using a network of Smart Hubs spread across the country. We plan to own and put 10,000 SmarTrucks on the road and hire 20,000 drivers in the next 10 years. These trucks will be IoT-enabled and temperature-controlled which will enhance customers’ inventory management and enable them to reach customers and markets faster.

Our aim is to disrupt the logistics industry in India through judicious and progressive use of technology, customised to the industries we serve.

5)

How do you foresee the future of the Indian Logistics Industry with regard to development of infrastructure and technology catering to efficiency in logistics and transportation related operations?

The Indian logistics sector is at a very interesting stage right now. On one hand, there are some great initiatives that are creating immense growth potential in the sector, while on the other, constraints still exist and are putting the brakes on this growth.

Technology adoption is also a new challenge the industry faces. While there is tremendous scope for the application of new and emerging technologies to streamline Indian logistics, technology application and infrastructure development needs to keep pace. For example, the cold chain segment has a lot of potential, but inadequate technology adoption is hampering the reliability and security that this segment needs, for businesses to be able to depend on their logistics partners.

At DHL SmarTrucking, we are determined to bridge this gap and increase the trust quotient in Indian logistics.

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Shippers Speak

“Excellent supply strategy is essential to meet challenges for faster role out of network�

1. How important is logistics for the overall scheme of your business?

There is no denying the fact that logistics is the backbone of any business house who deals in any kind of material sale. In the telecom industry, logistics has more importance by nature of the industry. Implementation of new network or the maintenance of existing network requires a lot of procurement and movement of materials.

2. How do you ensure smooth coordination between suppliers, transporters and other departments in your supply chain?

Telecom is now a matured industry in India, all process is set and well placed.

Availability of trained manpower, well equipped material suppliers and specialised transporters have made coordination smooth and easy-going.

3. Are there any unique or innovative strategies that you have adopted for better supply of your products?

Ramkesh Jangra, Supply Chain Head, Ericsson, is a person to look forward to getting a solution for any complex supply chain issue.

With having a rich experience of 19 years working in the supply chain domain with different top-notch companies like Hewlett-Packard, Nokia and Global Infratel Pvt Ltd, his excellent execution skills and operation management makes him an expert in the field. In an interview with Gaurav Dubey, the latter talks about how he strategises Ericsson’s supply chain, and much more.

62 CargoConnect - august 2018

Technology is evolving at a lightning speed, once there was a time when even landline telephones were scarcely available and now we have moved to CDMA, GSM series like 2G, 3G, 4G(LTE) and now, India is all set to adopt 5G network.

Best suitable supply strategy is essential to meet challenges for faster role out of network to stay competitive in the market.

4. What percentage of your logistics work is outsourced? What functions are performed by your logistics partners and what are controlled internally?

In the Telecom industry, warehousing and transportation are fully outsourced to expert logistics partners. The principal company controls operations through its own team and ERP tools.

5. Tell us about the most common problem faced by your company during its supply chain process. What steps do you take to overcome these?

There were multiple problems, such as high turnaround time taken in domestic transportation, sudden requirement of huge vehicles to do faster role out in short time, lack of forecast and sudden change in Govt. policies. To handle these challenges the necessary and required steps are always strategised.

6. Who are your Logistic Service Providers (LSP)s and what qualities you seek for in them before choosing their services?

We work with several leading LSPs of the country like NWCC, Seagull, DHL, KN, Spark Logistics and VKI International. Standards which we look for in LSPs include excellent infrastructure, their own vehicle fleet, trained manpower, vehicle tracking system, with meeting all statutory government compliances.

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5

key areas Logistics Businesses should

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required to support future growth.

VARUN BIYANI

T

he term logistics is broad in nature and includes various facets such as 3PL Logistics, Last Mile Delivery, FTL/LTL movement, Containerised Cargo/Export Containers, Rail/Air Cargo, Warehousing and many more sub-categories within each of these broad categories.

The logistics sector in India has today become a key performance indicator of the economy. One of the primary reasons for it is those years of high growth in the Indian economy has resulted in a significant rise in the volume of freight traffic moved. This large volume of traffic has opened up new growth opportunities in all facets of logistics including transportation, warehousing, freight forwarding, express cargo delivery, container services, shipping services, etc. On a yearly basis, India moves about 1325 billion ton-km of goods and the number is expected to double by 2025.

Various estimates put the total market size of the logistics sector in India to be between USD 90-125 billion. Sources also estimate that the logistics sector employs over 45 million people in India.

Logistics cost is 14-16 per cent of India’s GDP in comparison to 11 per cent in Europe and 9 per cent in the U.S. There is no doubt that in India an increasing demand is being placed on the logistics sector to provide solutions, which is

64 CargoConnect - august 2018

In the years to come, the Indian economy will be driven by sectors like manufacturing and retail (offline and ecommerce). So, for these sectors to contribute effectively to the economy, the logistics industry in India will have to improve upon its gaps and deliver value-enabling solutions. To achieve this, the logistics industry needs to focus on the following fronts: E x pa n d distri b uti o n cha n n els a n d i n crease consumer reach– Although the delivery and distribution channels have seen a major expansion due to increase in demand and consumption, we are yet to reach a lot of key geographies across India. A good solution would be to tie up with local retailers/post-offices and make them as order pickup/drop points to reduce the last mile costs.

Leverage technology to reduce operational cost– It’s a no brainer that a flurry of tech driven start-ups have come in this space and are trying to come up with solutions to improve the day-to-day operations of logistics companies. It might be aggregators, vehicle tracking solutions, sales force/delivery boy tracking, and workflow automation. Believe it or not technology is the way forward and businesses embracing the power of technology will see a significant drop in their operational costs.

Overcome infrastructure bottlenecks- Infrastructure remains a key element that drives the growth of logistics and keeps the profits in-tact. The government has been pushing several programs to improve the condition of roads, introducing multi-lane highways and educating the drivers about the benefits of plying vehicles on toll roads.The government

of India has introduced dedicated freight corridors and is working on leveraging multi modal transportation via inland waterways which will bring sustainable transportation and reduce the operational costs significantly.

The early movers who utilise these distribution channels will definitely be in an advantageous position in the future.

W areh o usi n g – W i t h t h e introduction of a single tax window, GST, all of a sudden warehousing has become a key focus of majority of Manufacturing and Logistics Company.

Gone are the days when manufacturers needed a presence in a state to leverage taxation benefits, with a single tax window, a lot of industries will need good warehousing solutions and this is where logistics players can identify the hot zones where a warehouse can be hosted so that distribution can be less cumbersome and the last mile delivery is easier.

Process Automation- The logistics business drives on quick service and fast turnaround times.

Yet, there is a lot that goes on in the background before a shipment or a truck is in transit. The reality is that a lot of these processes are manual and eat up a lot of time, which adds to the overall TAT. It is imperative that ongoing investment is made in automating process that allows one to expand without increasing other oversight expenses As mentioned earlier the logistics industry is witnessing a continuous growth. Although, there are multiple challenges that exist in this industry, the growth of logistics is going to be a key indicator in the performance of our economy.

(The author is CEO & Founder, SuperProcure Logistics)

4

guest column

ways by which Digitisation is empowering Logistics Service Providers to collaborate and improve

F

or a long time, the logistics and freight forwarding space functioned in archaic methods. Logistics service providers (LSP)s played their cards close to their chest. Service was unpredictable, negotiations were tedious and deadlines were often missed.

The industry and its customers accepted these practices as norms, just like parents accept the crying of a toddler.

But technology is changing all that, like it changes the very foundation of every sector it forays into. Technology is introducing transparency, predictability and stability in this space. Its functioning as a powerful enabler to help LSPs improve efficiency, collaborate, and enjoy better margins while delighting customers by providing them with customised solutions.

Until the late 90’s, LSP’s – especially the small- and medium-sized firms – faced three massive challenges. They were: 1.

Affordable airline and shipping line rates: Conglomerates could easily better get due to their tie-ups with carriers, but SMEs struggled with the same.

timely delivery and effective communication. Technology has improved both aspects in the following ways: 1.

Transparency for customers: Digital platforms now enable shippers and consignees to feed in the necessary information like invoice, packing list, and transit time and get multiple rates and delivery information in tme.

Customers now get access to a large pool of service providers and choose LSP’s they want to tie up with based on rates and delivery time.

2. Improved business for LSPs: With the advent of digitisation, small- and medium-sized LSP’s no longer have to struggle to find business and grab market share. “A tie-up with the creators of digital platforms enables LSP’s to increase their client base with minimum acquisition costs and risk. They pay the platform a commission only when they get a shipment,” says Ruchi Dogra, cofounder of FreightCrate.in. This enables LSP’s to enjoy better margins and return on investment.

3. Lack of transparency: SMEs couldn’t track why they lost deals.

As a result, they found it a Herculean task to analyse what they could do to improve their market share.

3. B e t t e r o r d e r m a n a g e m e n t and tracking: With increased collaboration comes an increase in the number of parties involved in moving a consignment. Each LSP has a specific labeling system, and some companies are wary of farming out the last crucial mile of the journey to the consignee since it doesn’t reflect their brand. The result? Tracking a consignment is erratic and a pain for the shipper and consignee.

4 Ways by which Digitisation is leading to improvement For customers, two aspects are critical when it comes to freight forwarding –

Thanks to digitisation, this no longer poses a problem. The Digital aggregation platform that moves the shipment accurately presents all parties with the

2. Tedious and lengthy negotiations: SMEs had to retain a decent profit margin for themselves, but customers weren’t so keen. The result was longer negotiation timeframes.

Ruchi Dogra

necessary details about the shipment.

This ensures communication stays as smooth and predictable as possible 4. Analysis: The three abovementioned aspects leads to better information for customers and LSPs alike. Customers can choose to work with LSPs based on historic data and performance. At the same time, LSPs can track shipments they won or lost and reasons for the same. Accordingly, they can adjust their offerings and pricing to improve their performance and increase market share.

“Digitisation has proved to be a game changer in the logistics and freight forwarding space,” Dogra said. “It has brought about much needed efficiency and improvement in an industry which otherwise was functioning in an outdated manner. In an increasingly competitive business landscape, aspects like transparency, effective communication and adherence to deadlines have become non-negotiable for shippers and consignees. Technology is steadily enabling LSPs to deliver on these aspects to their customers.”

(The article is authoured by Ms Ruchi Dogra, Co Founder and Director of Freightcrate Technologies )

august 2018 - CargoConnect

65

APPOINTMENTS Unisys names Sumed Marwaha as new MD for India ops

Airbus appoints Ashish Saraf as head of India helicopter biz

Sumed Marwaha has joined Unisys as the new managing director for its India operations and regional vice president for Services.

I n his ne w rol e, Marwaha is res p o ns i bl e f o r l eading Unisys’ operations in India. Marwaha brings more than two decades of IT industry experience to this role, having set up and managed multi-country-level business operations ensuring high quality and profitable services.

Airbus has roped in Ashish Saraf as head of the helicopter division of Airbus India to lead its initiatives.

Saraf joins Airbus Helicopters at a time when the company is competing on several military helicopter projects that would reinforce and enhance the local aerospace and defence industrial ecosystem. Since 2015, Saraf had been serving as vice president – industry development, strategic partnerships and offsets at Airbus India.

CargoM appoints Ms. Magali Amiel as Director, S&P

Ulrich Ogiermann joins Volga-Dnepr

Cargo Montreal (CargoM), the Logistics and Transportation Metropolitan Cluster of Montreal, has announced the appointment of Magali Amiel as Director, Strategy and Projects.

Ms. Amiel has served as Senior Project Manager and for several years has managed CargoM working groups. Her academic background and career path enabled her to develop extensive expertise in freight transport and logistics at the metropolitan level and internationally.

Vaiyapuri takes charge as VOC port deputy chairman N Vaiyapuri has assumed charge as Deputy Chairman, VO Chidambaranar Port Trust, Tuticorin, succeeding S Natarajan.

Vyapuri was Deputy Chairman of Paradip Port Trust from March 9, 2015.

He started his career as Assistant Traffic Manager at Chennai Port Trust in 1983.

He was elevated to Traffic Manager of Mormugao Port Trust in 2006 and thereafter as Traffic Manager at Chennai port.

66 CargoConnect - august 2018

Ulrich Ogiermann has joined Volga-Dnepr Group as Senior Vice President for Operations, reinforcing the strategy of building an international cargo airlines group.

Mr. Ogiermann will be responsible for the implementation of VolgaDnepr’s international cargo airlines group strategy, which is aimed at realising the synergistic effects of strategic partnerships between airlines to guarantee high-end and cost-efficient solutions for its global customers.

Harindra Rao takes over as GM of SER Harindra Rao, General Manager, Eastern Railway (ER) and Chittaranjan Locomotive Works (CLW), has taken over additional charge of General Manager South-Eastern Railway.

Rao takes charge from July 21. Rao has previously worked in Eastern Railway, South-Eastern Railway, Chittaranjan Locomotive Works, Diesel Locomotive Works, East Central Railway, South Central Railway, West Central Railway and North Central Railway.

Hariri joins IATA Cargo Committee Saudia Cargo Chief Executive Officer Omar bin Talal Hariri has been selected as a member of the Cargo Committee of the International Air Transport Association (IATA).The committee of 19 members represents different global airlines companies.

Hariri is a seasoned and accomplished Saudi executive who has held senior positions in several companies during his career, with considerable expertise in transportation, supply and logistics services.

Emirates SkyCargo ropes in David Harman as new Cargo manager Emirates SkyCargo has appointed David Harman to the key position of Cargo Manager for Switzerland.

Based in Zurich, Harman will be responsible for overseeing all operational and commercial aspects for the freight division of Emirates in the country.

He previously worked as VP for dnata Ground and Cargo Handling in Zurich and held various positions through the years at CHEP Aerospace Solutions Ltd, Swissport International, etc.

BIFA names Susanne Oud as its new board member Susanne Oud has joined the Board of Directors of UK trade body British International Freight Association.

Susanne is operations director EMEA - verticals at BIFA member company, OIA Global. She learned the trade through positions with an exporter, shipping line, freight forwarder, before establishing project forwarder and vessel agent, Westlink Shipping.

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Truckers call off strike after govt assurance to look into demands Truckers called off their eight-day old strike on July 28 after government’s assurance to look into their demands, according to a joint statement joint statement by the Road Transport and Highways Ministry and AIMTC. The decision was taken after a marathon meeting of transporters and senior Road Transport and Highways Ministry officials.

All India Motor Transport Congress (AIMTC), which claims support of 93 lakh truckers, had gone on an indefinite strike demanding reduction in diesel prices, among others, from July 20.

After the assurance from the government to look into transporters demand and constitute a high-level committee under the Road, Transport and Highways Secretary, the strike was called off, the statement said.

Transporters’ loss stood at `28,000 crore in the seven days while government’s intervention was desired for tangible resolution of the issues. Transporters’ demands included a reduction in central and state taxes by bringing diesel under the GST so that price of the deregulated commodity can be reduced. Apart from this, they pressed for exemptions and abolition of indirect taxes, national permits for all buses and trucks and also doing away with the direct port delivery tendering system.

Essential commodities have been kept out of the strike. The Indian Foundation of Transport Research and Training (IFTRT), however, said that the strike has failed to make much impact.

Central Warehousing Corporation launches e-negotiable receipt Central Warehousing Corporation has launched the E-Negotiable Warehouse Receipt (E-NWR). Speaking at the launch, Dr B.B. Pattanaik, Chairman, Warehousing Development Regulatory Authority (WDRA) said, “Introduction of the e-NWR is part of the digitalisation of registration, monitoring and surveillance of e-NWR, wherein farmers and traders will get better and transparent access to the market.”

Further, he said with the introduction of e-NWR, depositors of stocks can now avail of the benefit without visiting the warehouse where they are depositing the stocks and they can simply make transactions even at their doorstep. The move has been welcomed by traders/ depositors as well as the banking sector, as it is a transparent and quick mode of communication.

Lufthansa Cargo to operate two new Boeing 777 freighters Lufthansa Group’s decision-making bodies have approved Lufthansa Cargo’s operation of two new Boeing 777F freighters. Lufthansa Cargo ordered two brand-new Boeing 777 freighters in May of this year. The question of who would manage and operate these was left open initially. The jets are expected to be ferried from the Boeing plant in Seattle to their future base in Frankfurt am Main in February and March 2019.

The new aircraft will enable a modernisation of the fleet and are expected to replace MD-11F freighters in the long term.

Given how well the market is performing at the moment, Lufthansa Cargo will continue to operate some of the MD-11Fs earmarked for retirement for the time being so as to provide customers with more valuable cargo capacity as needed.

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Cathay Pacific and Unilode successfully conclude trials for next-gen track and trace

India to gain control of Mattala airport in Sri Lanka

Cathay Pacific has been working with Unilode Aviation Solutions and OnAsset Intelligence to enable end-to-end shipment tracking with realtime information.

The trial, in harness with Unilode Aviation Solutions and OnAsset Intelligence, focused on the practicality of using these wireless devices in the multi-storey, concrete surroundings of the cargo terminal. Results have proven successful and have enabled the airline to prepare for a proof of concept with actual shipments.

Next-generation track and trace is a part of Cathay Pacific’s digital strategy, to help answer the industry’s need for greater transparency along the air freight journey. The ambition is to provide customers with real-time tracking of their cargo shipments with multi-dimensional readings. The use of BLE means data can be captured automatically.

India has agreed to form a joint venture with Sri Lanka to operate the country’s loss-making Mattala Rajapaksa International Airport in Hambantota, the Sri Lankan Civil Aviation Minister has told Parliament.

The $210-million facility, 241 km south-east of Colombo, is dubbed the “world’s emptiest airport” due to a lack of flights.

India would operate the airport as a Sri Lanka-India joint venture, the Sri Lankan Parliament was told yesterday. The joint venture would see India gain a major stake of the airport, he said.

Minister of Civil Aviation Nimal Siripala de Silva, speaking at the adjournment motion moved by the Opposition, said: “We need to revive this dying airport, which caused a massive loss of rupees 20 billion.” The final terms of the agreement, however, remains to be worked out, the minister said.

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Government backs measures to make Kannur Airport fully operational by September Minister for Civil Aviation Suresh Prabhu has said that the Kannur airport will be provided with all possible help to make it fully operational by September this year. After meeting with Kerala Chief Minister Pinarayi Vijayan, Prabhu has directed chairman, Airport Authority of India and other officials from the ministry to take all possible steps to make Kannur Airport as a point of call for foreign airlines.

During the meeting, Kerala CM has requested for the intervention of Civil Aviation Minister for granting permission to foreign airlines to operate from Kannur and direct Indian airlines to operate more international flights from Kannur.

DB Schenker to set-up logistics center in Pinghu DB Schenker, a major logistics service provider, and the Eastern China city of Pinghu concluded a Memorandum of Understanding (MOU) for the establishment of a state-of-the art logistics center in Pinghu, Zhejiang province.

Due to its convenient location near the metropolitan areas of Shanghai, Hangzhou and Suzhou, and its proximity to the deep-water port of Yangshan and the port of Zhapu, the city of Pinghu is a strategic location for a logistics center. Besides its economic strength, Pinghu also has a long and impressive history of more than 6,000 years as one of the birth places of the Chinese culture. DB Schenker’s future logistics center in Pinghu will provide state-of-the art operations and management systems for both existing and new customers of DB Schenker from various industries comprising industrial, healthcare, ecommerce and electronics.

Korean Air Cargo commences Delhi flight with a B777 freighter Korean Air commenced operating a B777 freighter to Delhi three times a week. The new freighter will depart from Incheon, make a stop at Hanoi and arrive at Delhi the next day. The return flight from Delhi to Incheon includes stops in Vienna and Milan.

The introduction of the freighter service is also promoted by the South Korean government’s new diplomatic strategy to strengthen its partnership with India coupled with the rapid market growth of the sub-continent.

Recently South Korean President Moon Jae-in visited India and held talks with his Indian counterparts to find ways to boost trade and commerce.

“For Korean Air, Delhi is a very strong market, particularly as a destination coming from the Far East. The current routing of the freighter service to Vienna and Milan from Delhi give Indian shipments a seamless connectivity by road feeder service all over Europe,” said Prithviraj Singh Chug, director of Group Concorde, the general sales agent (GSA) for Korean Air Cargo India.

70 CargoConnect - august 2018

Lufthansa Cargo markets air cargo capacities on the spot market using the digital platform cargo.one cargo.one, the provider of an airline-independent digital platform for marketing and booking of air freight capacities, and Lufthansa Cargo seal their cooperation with a cooperation contract. Lufthansa Cargo is thus opening up a new digital sales channel for the spot segment. The globally available capacities of Lufthansa Cargo will be integrated into the cargo.one offering for this purpose.

The partnership between cargo.one and Lufthansa Cargo enables air freight forwarders to book available air freight capacities for td. Flash and td.Pro completely digitally and in real time across the entire available route grid of Lufthansa Cargo.

“Digitization allows information to be distributed around the globe in fractions of a second. We are therefore now offering our customers the opportunity to exchange prices and capacities even faster and to book services even more easily,” says Peter Gerber, chairman of the board of Lufthansa Cargo.

news

Panalpina swoops on another perishables forwarder

Gadkari to inaugurate Rs 830 cr iron ore handling complex at Vizag port

Panalpina has again expanded its perishables network with the acquisition of a ... forwarded said the acquisition of Skyservices, a South African company specialised in air freight perishables exports. Skyservices is headquartered at Johannesburg airport and has a strong presence at Cape Town airport.

With the latest acquisition, Panalpina sets foot in a strategic market with its own presence in Johannesburg and Cape Town. The move will enable end-to-end solutions for perishables from South Africa to Europe, the Middle East, Far East and the USA. “The acquisition of Skyservices allows us to rapidly become a major player in South Africa’s perishables market. The majority of the company’s export volumes go to London, Amsterdam and Frankfurt, where we have a strong perishables expertise and can therefore offer end-to-end solutions to customers,” says Stefan Karlen, CEO of Panalpina.

The Union Minister for Road Transport and Highways, Shipping and Water Resources, Nitin Gadkari, inaugurated India’s largest 24 mtpa iron ore handling complex, built

by Essar Vizag Terminal Ltd (EVTL) at a cost of Rs 830 crore at the Visakhapatnam port.

According to the press release, he has dedicated the latest facility to the nation. With its advanced cargo handling equipment, the iron ore handling complex will have the fastest vessel turnaround time of 120,000 tonnes per day among Indian ports. The complex, which has a berth length of 325 metres, can now berth super capesize vessels up to 200,000 DWT, with a depth of 20 metres, at the outer harbour of Vizag port.

EVTL has made investments in ramping up the capacity and installing the latest cargo handling equipment at the complex, which include: a 27 tips/hour twin-tippler, a 30 tips/hour rotary tippler, two 2,700 TPH (tonnes per hour) stackers, two 4,000 TPH reclaimers and a 8,000 TPH ship-loader.

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Tata Steel to develop Subarnarekha port

Government working on another version of UDAN

Tata Steel plans to develop the Subarnarekha port at the northern-most tip of Odisha, where the river Subarnarekha merges with the Bay of Bengal.

The port, with the ability to manage large-sized ships, will be developed at a cost of `4,000-5,000 crore in three to four years, said an industry source privy to the matter.

The precise location in north Odisha will allow the Subarnarekha port immediate proximity to West Bengal, Jharkhand, Bihar, and even Nepal.

The port is likely to have the potential to handle large ships with 180,000 dead weight tonnage capacity with 18-metre draft that will help Tata Steel lower its transport and product costs.

The Civil Aviation Ministry had started work on another version of regional air connectivity scheme for tourist destinations. The existing scheme, known as Ude Desh ka Aam Nagrik (UDAN), seeks to connect unserved and under-served airports in different parts of the country.

As many as 56 unserved and 17 under-served airports and 31 heliports would be connected under the scheme, Minister of State for Civil Aviation Jayant Sinha said in a written reply to the Rajya Sabha. In another written reply, he said the ministry has started work “on another version of the UDAN for connecting tourist destinations to other cities in India”.

LMD Expo & Convention gears up for its 2nd edition The Last Mile Delivery Expo & Convention (LMD) is all set for its second edition, scheduled to take place from August 23 to 24, 2018 at The Leela Ambience Gurugram Hotel & Residences, Gurugram.

LMD, powered by the India Warehousing Show (IWS) is a one of a kind platform for knowledge sharing, networking and business development.

It aims at bringing together 200 industry experts - fulfilment, supply chain, last mile delivery, logistics, etc. from leading e-commerce and retail companies who face last mile challenges.

Centre offers to develop another major port in AP The Union Minister for Shipping, Highways, Road Transport and Water Resources, Nitin Gadkari, has offered to develop another major port in Andhra Pradesh at Vadarevu in Prakasam district, if the State Government is able to provide 3,000 acres of land for the purpose. At present, there is only one major port in the State - Visakhapatnam.

He made the announcement at a media conference recently, after reviewing the performance of the 12 major ports. He said ports should come up with innovative ideas to increase their efficiency and profitability.

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Port Rail Corp keen to operate, maintain rail infra at major ports Mazagon Dock may develop new yard at Nhava Mazagon Dock Shipbuilders Ltd, India’s biggest warship builder, is weighing plans to set up a greenfield yard at Nhava near Mumbai as the State-run yard looks to overcome capacity constraints for expansion.

“Our future growth and expansion is limited by our current infrastructure,” the Mumbai-based MDL, controlled by the Ministry of Defence, wrote in the draft papers filed with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO) of shares, adding that its capacity for outfitting warships and submarines was limited “by our location”.

The Indian Port Rail Corporation Ltd (IPRCL), the company set up to build rail connectivity to ports, has signalled its readiness to take over the operation and maintenance of rail infrastructure including locomotives run by the Central government-owned major port trusts, a top official has said.

The 12 major ports owned by the government hold a combined 90 per cent stake in IPRCL with railway PSU Rail Vikas Nigam Ltd holding the balance.

The 12 major ports have a combined rail track network of some 900 kms inside their premises and run more than 80 locomotives.

Taking over the rail operations at the major port trusts with their approval is one of the mandates of IPRCL, apart from adding rail infrastructure/last mile connectivity to the ports.

news

Air France KLM Martinair Cargo rolls out digi solutions

DHL Express strengthens unmatched intercontinental network At the Farnborough International Airshow, DHL Express announced that the carrier has placed an order for 14 Boeing 777 Freighters, which also includes options and purchase rights for 7 additional aircraft. The delivery of the first four planes is expected to be completed in 2019.

“As the most fuel-efficient, most reliable freighter type with the best long-haul range, these aircraft will contribute to our emissions reduction targets and allow us to serve even more markets with non-stop flights. DHL took delivery of the 3rd B777F produced by Boeing in 2009. With extensive experience operating this freighter type, it has proven to be superior in all aspects of operation making it a logical choice,” explains Ken Allen, CEO, DHL Express.

Air France KLM Martinair Cargo (AF-KLMP) is investing in innovation and technology to provide its customers with transparency before, during, and after the transport of their shipments.

“Our customers can now get quotations, information about the latest and best deals, and do their booking via AFKL Cargo’s digital platform myCargo,” Global Head of Pharmaceutical Logistics Enrica Calonghi explained. “After a period of tests in several European countries we have started the rollout of this important tool, which we are already using widely for general cargo, also for pharmaceutical logistics.”

AF-KLMP customers can also use myCargo to track the current temperature, the battery level in the dry ice units, and the voltage in the active containers during their transit at the Amsterdam Schiphol and Paris Charles de Gaulle hubs.

Kinship Agency exports Dorniers-228 Aircraft from HAL Kanpur to Seychelles Kinship Agency, one of the leading Custom Clearing Agents in Kanpur that handles customs clearing of import and exports amongst all the ICD’s at Kanpur, on June 22 exported the Dornier -228 Light Utility Aircraft to Seychelles. The formal handover ceremony of the aircraft to the President of Seychelles Danny Faure was done by Prime Minister of India Narendra Modi at Palam Air Base in New Delhi, on June 26. The fabrication of the aircraft was done by Hindustan Aeronautics Limited (HAL) and the export formalities were managed by Kinship Agency, Kanpur.

Commenting on the successful operation Ravi Dayal, Managing Director, Kinship Agency said, “Kinship Agency under Late S.S. Dayal was entrusted to carry out the similar operation in 2013 which was carried out successfully. Now with the same virtue the Government of India, yet again has trusted on our company to carry out export with equal expertise.” He also added that entire Kanpur Commissionerate and Customs department extended full cooperation to be the part of this assignment.

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viewpoint

GST Review: FFFAI urges for more clarity on services sector

S Ramakrishna Vice Chairman, FFFAI With the country inching towards a firm and transparent indirect tax mechanism with the introduction of GST and E-way bill a year ago, it is necessary to contemplate the effects and issues still remaining in the system.

There are some areas of concern that requires to be addressed. “After

completion of one year of GST we can say that it has matured to a great extent in terms of filing of Returns. However, for the services sector, export services have not been defined adequately. For example, refund application for similar export service is viewed differently by officials at different locations, resulting in unnecessary review applications,” said S Ramakrishna, Vice Chairman, FFFAI. He mentioned that the concept of GSTR-I, 2 and 3 should have been continued so that auto reconciliation through the system could have happened.

Ramakrishna also urged for doing away with human intervention, which is, in fact, the intention and vision of the present Government at the centre.

“Issues pertaining to taxes on goods are more or less resolved and are being settled in the regular GST Council meetings. Our sincere request to the Council is to redefine the export services so that there is no scope of ambiguity and hassles to service providers,” the FFFAI Vice Chairman appealed.

It is also pertinent to mention that the technology support from GSTN, which is the backbone to successfully implement and carry out the tax revolution in India, has to be well-structured and streamlined. “As the Finance Secretary of India - Hasmukh Adhia assured in his very recent statement, we are looking forward to the next GST Council meeting for some pragmatic decision on service sector, GSTN and other issues,” Ramakrishna added. august 2018 - CargoConnect

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events

Safeducate aims high in its 2nd phase of Container School training

Targets to train 70K students, Model school launched in Binola, Haryana Safeducate, a pioneer in bridging the industry – academia skill gap, launched the 2nd phase of Container School training programme on July 17, 2018. The model school was inaugurated today by Hon’ble MoRD Joint Secretary (Skills) Kamran Rizvi along with Safeducate Founder and CEO Divya Jain.

The Container School Training Programme is a unique innovation from Safeducate, where classrooms are made out of recycled containers to be used as skill development centers. The concept launched in 2015 has been highly successful and has trained over 35,000 students from Tier 3 and rural India in two years. This novel experiment is widely lauded by the National Skill Development Corporation (NSDC) and Ministry of Rural Development (MORD) as it has the potential to transform the skilling landscape.

The second phase of the Container School Program is aimed at expanding its geographical reach and increase the base of beneficiaries by more than double its current strength, i.e. 70,000 students. The innovative concept of converting recycled containers into classrooms and practical labs will greatly bring down the cost and effort involved in developing infrastructure to meet the skilling needs of people. The modular nature of these containers means that they can be disassembled and reinstalled in another location, whenever needed. Over the past 2 years training is being conducted across 20 locations including Nagpur, Ahmedabad, Dhule, Sawai Madhopur and Jamshedpur.

The initiative is being part-funded by the Skill Development Ministry under the aegis of the Pradhan Mantri Kaushal Vikas Yojana and Skill India Mission.

ACCD organises speaker lunch on the theme ‘Logical Investing in Current Market’ The Air Cargo Club of Delhi (ACCD), under the flagship of their new president Mr. Sajan Kalra along with the managing committee kicked off a speaker lunch on July 18th at Radisson Blu Hotel, New Delhi. Financial Advisor and Promoter, Rohit Raman, with an interesting introduction on the theme ‘Logical Investing in Current Market’ gave a detailed insight on how to logically and sensibly invest in the market like a pro. The afternoon was complimented with scrumptious food and drinks.

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events

Cargo-Partner India celebrates Partners Day, commemorates achievements

Zebra Technologies wins ‘Vendor of the Year’ award, organises Media Roundtable

Cargo-Partner Logistics India Pvt Ltd celebrated their exceptional achievements over the last two years, topped off with best ever results in the 1st half of 2018 hosting top clients, strategic partners with cocktails & dinner at Hotel The Leela Ambience in Gurgaon on July 20, 2018. Vikram Paul, Regional Managing Director for Cargo-Partner in the Indian Sub Continent was in attendance together with the senior management team of India to host the prestigious attendees.

Cargo-Partner India posted over 57 per cent growth in Turnover together with a similar growth in air freight volumes & 37 per cent increase in ocean freight volume - 2017 to 2018.

On the special evening, management reminisced its humble beginning and exulted in their success achieved over the last two years.

Zebra Technologies successfully concluded their media event at Le Meridian in New Delhi on July 05, 2018, to launch two brand new products for India market – a ZQ300 mobile printer and FX9600 RFID reader for the fast-pacing retail, manufacturing and T&L industry. The launches were backed by their APAC Future of Fulfilment Vision Study for 2018, which had 35 per cent respondents from India.

Market leader in rugged mobile computers, barcode scanners and barcode printers enhanced with software and services to enable real-time enterprise visibility, Zebra Technologies Corporation has also been recognised as the 2018 ‘’Vendor of the Year’’ in both the Mobile Computers and Scanners categories, by the Automatic Identification and Data Capture (AIDC) Technologies Association of India.

BACC holds Annual General Meeting, elects new President The Bangalore Air Cargo Club (BACC) on 20th July held its 2nd Annual General Meeting (AGM). In the meeting, Dileepa BM of Shreeji Translogistics Limited has been unanimously elected as the New President of the Club. All Committee members and industry friends congratulated and wished the President on his new position.

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events

Mahindra unveils FURIO, its world-class range of ICVs Mahindra’s Truck and Bus Division (MTBD), a part of the USD 20.7 billion Mahindra Group, today unveiled the FURIO, its brand new range of Intermediate Commercial Vehicles (ICVs). FURIO marks the company’s entry into the ICV segment and is set to make Mahindra a full range commercial vehicle player.

Mahindra FURIO is the culmination of focused efforts from more than 500 Mahindra engineers, 180 suppliers and an investment of `600 crores.

Speaking on the occasion, Dr. Pawan Goenka, Managing Director, Mahindra & Mahindra Ltd said, “The unveiling of the new FURIO range of ICV trucks is a defining moment for our Truck and Bus business as we are set to enter a new orbit and become a full range commercial vehicle player. With Pininfarina inspired design, the FURIO is set to be a game changer for us and perhaps for the industry, giving the new truck one of the safest, most ergonomic and comfortable cabins that will set new standards.”

APM Terminals receives Authorised Economic Operator certification

Instituted by the World Customs Organisation, the Authorised Economic Operator certification, AEO, is a program that aims at preventing unlawful trade across borders and facilitating legitimate trade designates. By getting the AEO certification, APM Terminals India Pvt Ltd is acknowledged as a ‘secure’ and ‘reliable’ trade partner in the global supply chain and will enable delivery of higher efficiencies and speedy export-import services.

Previously applicable to exporters/ importers alone, the certification has recently been introduced as a single tier certification for economic operators like logistics providers, custodians or terminal operators, customs brokers and warehouse operators.

Team FIATA reaches Busan to discuss significance of FWC-2018 in Delhi

Recently, FIATA leaders along with the FIATA World Congress 2018 (FWC-2018) organising team attended FIATA RAP (Region Asia Pacific) Conference held at Busan in South Korea. As a part of their series of promotional campaign across the world, the team FIATA and FFFAI, which is hosting FWC-2018 from September 26-29, at Pullman, Aerocity in New Delhi, interacted with the conference delegates to highlight significance and chief features of the mega show this year.

In his presentation made at the FIATA RAP Conference, Mr Amit Kamat, Honorary Secretary FFFAI and Congress Coordinator, FWC-2018 elaborated on the theme “The Future Starts Here” and importance of this international logistics conference taking place in India for the first time. With factual details he emphasized on the growing story of brand India as far as its economy, trade & commerce, opportunities for logistics industry, industry-friendly policies and tourism are concerned. Also present on this occasion were Mr Babar Badat, President, FIATA; Mr Stanley Lim, past President and Chairman, Congress Committee FIATA; Ms Elena Primitzhofer, Congress Coordinator, FIATA and other dignitaries.

Presently, online delegates registration is in progress with Super Early Bird Registration closing on July 31. More than 1500 delegates from across the world and India will be participating in FWC 2018 that offers huge opportunities for B2B interactions.

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events

SIAM’s 5th Automotive Logistics Conclave concludes

Industry to synergise multi-modal logistics, upgrade to single window for logistics Society of Indian Automobile Manufacturers (SIAM), the apex body of the automobile industry, organised its 5th edition of Automotive Logistics Conclave on 26th & 27th July 2018, Hotel Taj Mahal in New Delhi. The two-day event saw discussions around critical issues confronting automotive logistics sector and development of various modes of transportation to meet the growing demand for transportation of vehicles from manufacturing plants to the dealers and ports for exports.

The event aimed for a concerted effort from the industry players and the Government to deal with the pressing demand for logistics and transportation across the nook and corner of the country, besides better connectivity across ports and other modes of transportation.

The theme for this year’s conclave was “Value creation through operational efficiency”. The conclave has sessions titled – Auto Logistics: Way forward, Multimodal-Only way to handle future growth, Logistics Challenges in Vehicle Exports and on Improving Efficiencies besides a Panel Discussion titled Leap Forward.

Industry leaders, Logistics Service Providers, experts from the Government discussed and suggested remedies for sustainable growth and a way out to address concerns on emerging challenges in India’s fast moving automotive logistics sector. The event also witnessed wide representation from global consulting companies like PwC, KPMG, Deloitte, amongst others.

From the Government, Mr Anant Swarup, Joint Secretary (Logistics), Ministry of Commerce & Industry, Mr Pravir Pandey, Vice Chairman, Inland Waterways Authority of India and Dr Anup Wadhawan, Officer on Special Duty, Ministry of Commerce & Industry and Dr Monica Agnihotri, Executive Director (Freight Marketing), Ministry of Railways, amongst others participated at the event. Senior officials from the automobile and logistics industry were also present during the conclave.

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upcoming events Automotive Supply Chain 2018 One-day event to be held on September 09, 2018, at Hotel Hilton, Chennai. Organised by CII Institute of Logistics, the conference focuses on the recent trends and developments directly impacting automotive supply chain, and future outlook in the rapidly evolving global supply chain.

To know more visit varghese.john@cii.in FTR Transportation Conference Scheduled from September 11-13, 2018, at the Historic Union Station in Indianapolis, Indiana, The FTR Transportation Conference, with over 80 speakers and panelists, and 450 attendees, is expected to bring together all the different aspects of the freight transportation world into one place.

To know more visit www.indiawarehousingshow.com PHARMA LOGISTICS SUMMIT Organised by Indian Transport and Logistics News (ITLN), the second edition of Pharma Logistics Summit, scheduled for September 20, 2018, at Taj Hotel, Bengaluru, aims at addressing the key issues plaguing India’s cold chain for the pharma industry and find out what it takes for its supply chain to emerge a winner.

To know more visit www.automotivelogistics.media/events/europe/2018-2 MARITIME NATION INDIA Three-day event scheduled from September 20 - 22, 2018, at CIDCO Exhibition Centre in Mumbai. The event will offer a unique global platform for exhibitors to demonstrate their expertise and secure business opportunities in the Indian Maritime Sector.

To know more visit www.maritime-world.com/mni2018 FIATA WORLD CONGRESS Four-day world level conference from September 26 - 29, 2018, to take place at Pullman New Delhi Aerocity.

The conference will provide logistics industry leaders from around the globe remarkable insights to industry challenges with sustainable solutions.

To know more visit www.maritime-world.com/mni2018 AUTO CONNECT 2018 - Automotive Logistics Conference Organised by Surecom Media, Auto Connect conference scheduled on October 15, 2018, at JW Marriott, Pune, will bring together all the stakeholders of the Indian automotive logistics industry under one roof, with offering an excellent networking and knowledge sharing opportunity for the attendees.

To know more visit www.autoconnect.co.in THE INTERNATIONAL AIR CARGO ASSOCIATION - AIR CARGO FORUM 2018 - TORONTO Three day event scheduled from October 16 - 18, 2018, at Metro Toronto Convention Centre, Canada. Over 4,000 air cargo decision makers and more than 300 exhibitors from around the world is expected to gather at this premier air cargo industry event to network and address current industry challenges and opportunities.

To know more visit www.tiacaevent.org Perishables Logistics Africa Taking place on 21 November 2018, at Radisson Blu Hotel, Nairobi, Perishables Logistics Africa will offer its usual and interesting blend of industry leaders debating and deliberating on key challenges and trends, and offering solutions to complex supply chain concerns shrouding the flower, fresh produce and meat industry.

To know more visit www.logupdateafrica.com/pla2018

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PEOPLECONNECT

“

needs to be at top of the game to overcome Challenges” Dr T Johnson, Managing Director, Greenways Group, has been associated with the organisation for more than two decades. Having started his career as an Operations Assistant with the Group in 1993, over the years Johnson has proved his mettle by offering ‘Out of the box’ solutions and reached the top management level with becoming the MD of the Group in 2014. His work has been recognised several times and recently, he was honoured with Doctor of Letters by ‘International Tamil University, USA’ for his outstanding contribution to the Shipping and Logistics industry.

In an exclusive interview with Gaurav Dubey, he shares his mantras of success and much more. Excerpts!

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What motivated you to be a part of the logistics industry? How has been your journey so far?

After completing my graduation in Engineering, I was looking for some challenging field to barge in. I found the Logistics Industry to be one of the challenging industries where one could achieve greater heights through dedicated efforts, and therefore I decided to join the industry. I must say – Challenge was the prime motivator which brought me into this industry. The journey of my 25 years with the industry so far has been great and I look forward to moving on further with the same passion and vigour.

How has the industry changed from the time you stepped in? What major transformations have you observed in the industry in terms of technology, manpower, practices, government regulation, etc.?

The industry has changed metamorphically since the day I stepped in. In the past, there were no 3PLs, 4PLs and other value-added service companies in existence. Logistics was not given preference during those days. After establishment of MNCs in India, logistics requirements went up which resulted in the development of logistics arms by shipping companies to cater to the growing demands. In terms of technology, recent introduction of E-way bill is the best example of technological transformation.

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What is the biggest challenge you have faced in your career?

I believe challenges exist everywhere and to overcome the competition one always needs to be at top of the game. I have faced several challenges in my entire career and whenever I faced stiff competition from my competitors, I successfully conquered it with my commitment and enthusiasm.

What is your success Mantra? And, whom you consider as your Guru in business?

Complete sincerity, dedication and loyalty are my Mantras to success. If we work with absolute sincerity and dedication and stay loyal to our work ethics then success will fall in our way for sure. I consider our respected Chairman, Late Dr Prakash Goel as my Guru in this business.

Apart from work, what are your other interests and hobbies?

In my leisure time, I love to play cricket and read books to relax and recharge myself with energy.

Which management lesson would you like to give to the industry aspirants?

The upcoming generation who aspires to be in this industry should work with a lot of passion, zeal and dedication and should imbibe these qualities to touch new heights in this challenging business.

Logistics through innovation, dedication & technology...

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