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F E D EX MO VES TO INC REA S E E U R OPE A N F OOT PR I NT W I T H T NT B UY Volume IV n No 2-3

C A R G O

APRIL-MAY 2015 I `60

L O G I S T I C S

FREIGHT FORWARD

Keen to make the railways more profitable, Railway Minister Suresh Prabhu is all set to boost growth in freight

With heaps of help from e-commerce, India Post has got into the turbo mode and is planning to deliver shipments where others have failed

FULL SPEED

AHEAD

“India is the world’s greenest cold chain…” NCCD CEO Capt. Pawanexh Kohli on the change in the approach towards cold chain

MANAGING EDITOR’s NOTE

Time for ‘Little India’ to shine

he world of cargo and logistics has been receiving news to cheer about. There was the big one about international package delivery giant US-based FedEx acquiring the Dutch major TNT Express. Almost on the heels of this acquisition came news of a good February as far as cargo was concerned. That was followed by developments on the infrastructure front: the Container Corporation of India (CONCOR) eyeing air cargo; Amazon India opening a 280,000 sq ft Fulfilment Centre (FC) on the outskirts of Hyderabad; the Union Cabinet’s three momentous decisions for shipping; Kamarajar Port Limited (KPL) at Ennore handling 2.15 lakh cars of five carmakers and as we go to press the Civil Aviation Minister’s announcement that the new civil aviation policy will connect India to Bharat. All these moves — though unconnected to each other — bring hope of the “achchey din” coming in sooner. I mentioned only bringing hope since it will be quite some time for the government announcements to fructify and see action on Ground Zero. Even so, there is much to look out for in a sector that has had seen the worst of times. Let us first take a look at the FedEx acquisition. When it does come through, it would make the US company a giant with a footprint that would virtually cover the whole world. Well, it does so even now but once TNT comes under its wing, the FedEx freighters will fly unhindered to connect European markets in UK and France. And, as reports point out, the TNT-strengthened FedEx will create the second-largest delivery company in Europe: FedEx will have a combined 17 per cent share in Europe, barely beating out UPS’ with its 16 per cent share of the market. The top position will be held by Deutsche Post. Will the acquisition create waves in India? It will. Industry pundits who have been keenly watching the goings-on believe that the only two major package de-

livery players on the Indian scene — while UPS does not have much of a presence in the country, TNT too has little to show — would be FedEx and DHL. Instead of competition, the two could very well dictate prices. Going by the statement of David Ross, Regional President-Fedex Express-Indian subcontinent, Middle East, Africa — that was quoted by a business daily — the acquisition will boost reach and increase footprint. Since TNT has been one of the top four global express transportation companies in India serving more than 200 country destinations with its worldwide network, the acquisition will pay off. The dovetailing of the operations of the two delivery companies in the country will take a while and “will be determined through the integration planning process”, according to Ross. Whatever the effect internationally, the domestic scene will be keenly watched where there could be stiff competition between FedEx and Blue Dart/DHL. Who gets the major share of the domestic market, only the future will tell. That brings us to the other developments. Government-controlled CONCOR’s positive moves have shown that even slow-moving organisations can be fired up to bring changes that will affect the general populace. And, if what Civil Aviation Minister Ashok Gajapati Raju mentioned about the new civil aviation policy — that it would connect ‘Little India’ or Bharat with India — the furthest and forgotten corners would be within easy reach. And as India touches more and more of ‘Little India’, we will see more action on the cargo and logistics front. Goods and perishables will fly out to metros and vice versa. As a result of all this, the chorus of a cargo hub that we have been hearing over the years will finally come to an end. Till then, keep reading and keep in touch.

tghosh@newsline.in

Cargo & Logistics I April-May 2015

contents ARTICLES NEWS VIEWS EDITS INTERVIEWS CLIPPINGS PROFILES NEWS DIGEST STATISTICS COLUMNS

CONTENTS

C&L

VOLUME IV n NO 2-3

Editor-in-Chief

K SRINIVASAN Managing Editor TIRTHANKAR GHOSH Consulting Editor RAMESH KUMAR Senior Sub-Editor-cum-Reporter PUNIT MISHRA

COVER STORY

p18

When India Post asked for dedicated aircraft to facilitate its e-commerce business, the news created a flutter. Indeed, the venerable and more than 150-year-old India Post has woken up. With its last mile reach, the government organisation is the only package delivery outfit in the country that can touch the remotest corners of the country.

H C TIWARI

All India Transporters Welfare Association (AITWA) organised its National Convention in New Delhi. The convention focused on Effective Governance for Efficient Transport. Attended by Nitin Gadkari, Union Minister of Road Transport and Highways and Shipping, the convention highlighted the challenges faced by the sector.

NEWSWATCH

p10

p12

The International Air Cargo Association (TIACA) has changed its stance from being purely airline-centric and has appointed Delhi Airport’s Sanjiv Edward as Chairman. Sebastiaan Scholte was Vice Chairman. The pair formally took over from Oliver Evans and Enno Osinga.

SPOTLIGHT

Correspondents ANJANA TANWAR, NAVEED ANJUM, CHARCHIT SINGH Designers NAGENDER DUBEY, MOHIT KANSAL Picture Editor PRADEEP CHANDRA Photo Editor HC TIWARI Staff Photographer HEMANT RAWAT

HEMANT RAWAT

EVENT

Sr. Proof Reader RAJESH VAID

Director (Admin & Corporate Affairs) RAJIV SINGH

Two separate committees, constituted by the Central Government to identify factors and issues affecting the growth of the Indian Railway, have submitted their reports to the Railway Ministry highlighting the bottlenecks that need to be removed.

NEWS IN BRIEF

FedEx has shown its interest to buy its Dutch rival TNT Express which will cost it around €4.4 billion ($4.8 billion). In the land section, Amazon India is investing hugely in the country to compete with its rivals in logistics, facility centres and warehouses.

Vice President (Business Development) VINOD KAUL Subscription ALKA SHARMA Distribution PANKAJ KUMAR, BHUSAN KUMAR Executive Director RENU MITTAL For advertising and sales enquiries, please contact:

+91-9810030533, 9810159332 Editorial & Marketing office: News Kingdom Media Pvt. Ltd., D11, Nizamuddin Eest New Delhi –110 013, Tel: +91-11-41033381-82 All information in C&L is derived from sources we consider reliable. It is passed on to our readers without any responsibility on our part. Opinions/views expressed by third parties in abstract or in interviews are not necessarily shared by us. Material appearing in the magazine cannot be reproduced in whole or in part(s) without prior permission. The publisher assumes no responsibility for material lost or damaged in transit. The publisher reserves the right to refuse, withdraw or otherwise deal with all advertisements without explanation. All advertisements must comply with the Indian Advertisements Code. The publisher will not be liable for any loss caused by any delay in publication, error or failure of advertisement to appear. Owned and published by K Srinivasan 4C Pocket- IV, Mayur Vihar Phase–I, Delhi–91 and printed by him at Nutech Photolithographers, B–240, Okhla Industrial Area, Phase–I, New Delhi–110020.

Cover Design: Nagender Dubey

April-May 2015 I Cargo & Logistics

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JUST IN TIME

SANJIV EDWARD TO HEAD TIACA BOARD TREND Etihad Cargo has unveiled TempCheck, its new cargo solution created to ensure the integrity of all temperature-sensitive pharmaceutical and healthcare products like blood plasma, tablets, medicines and anaesthetics as they are transported around the world. TempCheck incorporates the latest equipment, processes and operating procedures that keep all pharmaceutical products within a temperature-controlled environment at every stage of the journey, from the cool room facility to the ramp and from the aircraft to the customer. David Kerr, Vice President Cargo, Etihad Airways said: “Over the last two years we have seen tremendous growth in the amount of pharmaceutical products. We have successfully transported over our hub in Abu Dhabi as we continue to expand our passenger and cargo networks.” To meet this increasing demand, Etihad Cargo has also upgraded its temperature controlled storage facilities in Abu Dhabi, and has refurbished its existing cool rooms to meet pharmaceutical-safe specifications. Extensive new purpose-built facilities are also being established and are scheduled to come online in 2015, prior to the summer period. Kerr added, “We have been working closely with our pharmaceutical customers in developing this specialised solution, which has been designed to ensure that their temperature-sensitive pharmaceutical products are protected at every stage of the journey, and reach their final destination in perfect condition.” Etihad Cargo offers a combination of bellyhold capacity and maindeck freighter services to 111 destinations internationally, operated by a fleet of 111 passenger and freighter aircraft.

April-May 2015 I Cargo & Logistics

anjiv Edward, Head of Cargo Business at Delhi International Airport, has been named as the next Chairman of The International Air Cargo Association (TIACA), with Sebastiaan Scholte, CEO of Jan de Rijk Logistics named Vice Chairman. The pair will formally take over from Oliver Evans and Enno Osinga. “I am delighted Sanjiv Edward to be taking up this position. TIACA has a rich history and bright future, contributing to the global cargo industry,” said Edward. “Together with Sebastiaan, I am looking forward to working closely with an experienced Board and a valuable membership base,” he added. Edward has worked in the aviation industry for over 18 years, including more than a decade with British Airways. He completed his Executive Management Studies from the Oxford Brookes University and also served as a member of the high level Working Group constituted by the Ministry of Civil Aviation, India to formulate the Air Cargo Policy for India. He is one of the founding members of the Air Cargo Forum India and heads its Innovation Group.

Scholte has worked in the air freight industry for over 18 years, including with Aeromexico where he was VP Sales. He held senior management roles with Cargolux for eight years from 2002, and took over as CEO at Jan de Rijk Logistics in 2010. He holds a Global Executive MBA from the IESE Business School and is also Chairman of the Cool Chain AsSebastiaan Scholte sociation. “I am thrilled to be taking this new position and to be working with Sanjiv and the rest of the TIACA Board as well as all of the members,” said Scholte. “TIACA has a vital role to play representing all sectors of the air cargo supply chain at a time when cooperation is more crucial than ever. We would like to take this opportunity of thanking Oliver and Enno for their energy and dedication to TIACA and for their contribution to the air cargo industry,” he added. TIACA is governed by its Trustee members who elect the Board of Directors to manage the Association’s affairs and establish its policy. The Chairman and Vice Chairman are elected by the Board for two year terms. (See story on Pages 12-13)

MODEST GROWTH TREND CONTINUES

he International Air Transport Association (IATA) released data for global air freight markets, showing a modest 1.6 per cent rise in volumes in March compared to a year ago, measured in Freight Tonne Kilometers (FTK). “The industry’s March performance stands in sharp contrast to the exceptionally strong 12.2 per cent rise reported for February. February’s performance, however, was positively skewed by the combined impacts of the timing of the Lunar New Year and the labour dispute at US West Coast seaports,” said a release. Freight performance over the first

quarter of the year indicates year-on-year growth of 5.3 per cent. This is in line with general global economic trends and slightly higher than the 4.5 per cent growth that was anticipated in IATA’s December outlook. The regional growth picture remains highly mixed. Latin American and European carriers reported market contractions while Middle East carriers showed rapid growth. “The air cargo industry is on a solid but unspectacular growth trend. And there is little evidence today that would point towards an acceleration as the year goes on,” said Tony Tyler, IATA’s Director General and CEO.

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JUST IN TIME

SPV FOR MAJOR PORTS APPROVED

he Union Cabinet chaired by the Prime Minister, Narendra Modi, recently gave its approval for the formation of a Special Purpose Vehicle (SPV) to provide efficient rail evacuation systems to Major Ports and thereby enhance their handling capacity and efficiency. The SPV, headquartered in Mumbai with a registered office in New Delhi, would undertake projects like last mile connectivity to Major Ports, modernisa-

E-AWB PENETRATION DOWN IN MARCH

n March 2015, e-AWB global penetration was at 26.2 per cent, down by 0.7 per cent from the previous month. “In order to successfully reach the year-end target of 45 per cent, industry must grow on average 2 per cent per month. This is challenging but achievable, so we need to work together to accelerate e-AWB adoption globally,” said the release by IATA. Despite the fall in global e-AWB penetration, the e-AWB volumes are up by almost 60,000, the highest e-AWB volume growth in the last 12 months. Cathay Pacific Group, Emirates and Air France

- KLM Group are leading the way as the top three carriers in e-AWB volume. LAN Airlines has demonstrated the strongest growth between February and March with an increase of 3.4 per cent reaching 15.7 per cent e-AWB penetration. From a forwarder perspective, Panalpina has increased by 3 per cent between February and March bringing them up to 38.3 per cent e-AWB penetration. India has shown its full commitment towards the IATA’s initiative. Hyderabad International Airport was declared e-freight compliant in April 2015.

TOP E-AWB PERFORMERS % e-AWB Penetration

% Growth month over month

Netherlands

34.6%

4.2%

Hong Kong (SAR) China

57.5%

0.6%

United Arab Emirates

75.1%

0.3%

LAN Airlines

15.7%

3.4%

Delta Air Lines

53.2%

2.8%

American Airlines

12.0%

2.3%

Panalpina

38.3%

3.0%

Kintetsu

19.8%

1.9%

Hellmann

38.7%

1.1%

COUNTRY/LOCATION

AIRLINES

FREIGHT FORWARDERS

April-May 2015 I Cargo & Logistics

tion of evacuation infrastructure in Ports, to operate and manage internal Port Railway system and to raise financial resources for funding Port related Railway Projects. The SPV would be funded by all the 12 Major Ports and the Rail Vikas Nigam Limited (RVNL). Major Ports would contribute 90 per cent of the equity with RVNL contributing the rest. It would work in close co-ordination with the Indian Railways and leverage the existing participative model of the Indian Railways for enhancing last mile connectivity to Ports. The work of the SPV is expected to result in substantial reduction in the dwell time of cargo at ports and bring down the overall logistic cost for trade. The SPV also focusing on Port connectivity will fit into the ambitious Sagarmala Programme of the Government which aims at promoting port-led direct and indirect development and to provide infrastructure to evacuate goods from ports quickly and efficiently. It would be registered as a Company under the Companies Act with an initial authorised capital of `500 crore. The initial subscribed share capital would be `100 crore. It is also proposed to raise resources from multilateral funding agencies and other financial institutions to finance Port Connectivity Projects. The SPV would be manned by professionals with expertise on rail transport and port logistics. “The Government has taken many initiatives to improve the operational efficiency of the Major Ports to international standards. A massive thrust has been given to increase the capacity of the Major Ports and also to deepen the drafts so that larger vessels can be handled. Realising that these efforts would not bear fruit unless evacuation and connectivity are improved, the Ministry of Shipping proposed the creation of a SPV,” said a release.

EVENT

Effective governance for efficient transport

H C TIWARI

Stakeholders in the road transport sector from across the nation met recently to discuss the major problems facing the industry. The convention focused on how to bring about effective governance for efficient transport. A report

SETTING THE AGENDA: Union Minister for Road Transport and Highways and Shipping, Nitin Gadkari addressing the National Convention of Transporters organised by AITWA in New Delhi on May 8, 2015.

he road transport industry has been under stress for quite some time and the recent Budget has not been friendly at all. In terms of the infrastructure we may have developed good roads, expressways, highways but the distance cov-

ered has not changed much. Result: a lot of resources are wasted. Such issues were highlighted at the recent National Convention organised by the All India Transporters Welfare Association (AITWA) in New Delhi. The conven-

GST: A long and perilous road ahead W

hen the Lok Sabha passed the Goods & Services Tax (GST) Bill – pending for a dozen or so years – it was viewed as the country’s most noteworthy tax reform since Independence. Although the Bill still has to sail through the Rajya Sabha and receive a nod from more than half of the 29 states of the country, the move by the present government in initiating action on the Bill is noteworthy. As Finance Minister Arun Jaitley pointed out before the Bill was tabled in the Lok Sabha, GST would herald a new economic order: “The entire country will become one market and it will be an economic integration of India,” Jaitley said. He specifically mentioned the transport

April-May 2015 I Cargo & Logistics

industry and pointed out that GST would benefit states like Maharashtra. Taxes truckers paid before entering any state or city would be abolished once GST was implemented. “India becomes one uniform market where there is a seamless transfer of goods and services,” he said and also added that states’ share of revenue would go up and economic activity and growth would also improve. What Jaitley meant was that GST would bring in a single tax for all goods and services sold in India. In fact, the move would end the layers of taxes that are presently being levied by various states like excise, service tax, state VAT, entry tax, octroi and other state level levies. Instead there would only be GST.

tion was attended by Nitin Gadkari, Union Minister of Road Transport and Highways and Shipping and other senior officials of different ministries along with transporters from across the country. The theme of the Convention was “Effective Governance for Efficient Transport” and the aim was to identify the bottlenecks in the governance of the industry. Speaking about the problems of the road transport industry, Pradeep Singal, National President, AITWA said, “The industry is going through a tough time because of inaction of the Government on various issues. It is strange that even though we talk of One India, every state in India has different rules when it comes to road transport. We move essential commodities across India and are also called as the backbone of the economy – but yet we are stopped at check posts that are set up at frequent intervals. What is it that the officials want to check at such short intervals? The goods in the trucks or the documents do not change – so why the need for

Despite the government’s assurance that GST would make India one market, there are a few obstacles. The Bill, for example, proposes a tax rate of 27 per cent on all goods and services sold in the country – much higher than the global average of 16.4 per cent – there are states that are demanding more tax, considering their monopoly on specific goods such as tobacco in West Bengal or silk products in Tamil Nadu. Also while GST would not cover alcohol, petroleum products would be taxed separately. This can disturb the balance of commodities produced and consumed. GST has to travel on a perilous road. But once it is passed — Arun Jaitley has proposed April 1, 2016 as the operational date for the new Goods and Services Tax structure – the country can look forward to growth.

H C TIWARI

EVENT

BUSY SCHEDULE: Union Minister for Road Transport and Highways and Shipping, Nitin Gadkari (third from left) at the National Convention of Transporters, along with the members of AITWA

so many check posts? We have been asking for seamless movement of trucks across India, but nothing concrete has been dome on the same so far.” Highlighting the law and order issue, Ramesh Agarwal, Chairman, AITWA said that every day at least one truck was hijacked and goods were stolen. “It is unfortunate that our drivers and cleaners are killed in such incidents. But we are unable to even report these incidents as the police refuse to file complaints. The police drive away the drivers who approach them for filing complaints for thefts. As a result of the same we are unable to claim from the insurance also and it gets increasingly difficult to face our customers. We would request the Government to make a provision wherein the police should be duty-bound to accept all complaints and lodge a ZERO FIR,” said Agarwal. Ashok Gupta, General Secretary, AITWA said, “The road transport industry had vehemently protested against deduction of TDS from truckers. After understanding the issue, the Government decided to drop the same a few years ago. However, in the recent Budget, the same has been reintroduced and it will have serious repercussions. Instead of simplifying the paperwork and operations, the Government is further complicating the operations and increasing the work burden on the industry. The margins in the industry are very low and their direct costs including diesel, tyres, lubricants etc are over 90 per cent. Deduct-

ing 2 per cent TDS on the entire amount is illogical and leaves the transporter paying the TDS from his own pockets. Most companies and truck operators in the country do not use systems for accounting purposes. They may not be in a position to calculate the TDS and claim refunds, which again requires a lot of paperwork and calculations. Eventually the Government will pocket a lot of unclaimed amount as the truckers will not be able to claim refund because of various operational issues.” While addressing the gathering Nitin Gadkari said, “The criticism of the new Road Transport and Safety Bill 2015, in a section of stakeholders, is not founded on reasoning. The Bill ensures to adopt those standards and practices which provide safety on roads, development of better services to road-users and generation of more employment.” Gadkari said that the new Bill did not violate the rights of the states. As regards Inter-State contract carriage permits, these are envisaged to be issued by the National Transport Authority and the revenues due to each state would be transferred to concerned state on the analogy of National Permit System for goods carriers. The Minister also said the quantum of fines in the case of law offenders had been brought down from the amount in the earlier draft in view of the paying capacity of the people, except in cases of very serious offences. Gadkari, underscoring the urgency to make the transport sector more modernised and investment friendly, urged transporters

to take initiatives to develop state-of-the-art facilities for improving driving skill along with pollution certification and fitness test of vehicles. He drew the attention of transporters towards the immediate requirement of establishing Transport Nagars and Highway Villages at different locations to cater to the needs of drivers on long routes. Speaking on the issue of toll plazas highlighted by the members of AITWA, the Minister said that electronic toll plazas in the country would not be removed. The government, however, was considering providing some relief. “If you want good services, you have to pay for it. Toll will not be abolished. But we are looking at ways to provide some relief,” Gadkari said. He did not elaborate on the nature of relief the government intended. Stating that levying toll was a necessity for the government, Gadkari said that a move was on to convert tolls into eTolls to help reduce time and fuel cost. “Toll policy is a necessity and we are not happy to levy it. But with the use of the latest technology we will make the work of transporters and logistics players easier by looking at ways to reduce fuel costs,” the Minister said. The Minister also advised transporters to use bio-fuels that would help them save money as well as reduce pollution. On looking at alternative ways for transporting goods, he said the Road Ministry was likely to introduce the Inland Waterways Bill in Parliament that aimed to convert 110 Indian rivers into transport channels.

Cargo & Logistics I April-May 2015

NEWSWATCH

SMOOTH TRANSITION: (L-R) Enno Osinga, outgoing Vice Chairman; Oliver Evans, outgoing Chairman; Doug Brittin, Secretary-General; Sanjiv Edward, Chairman and Sebastiaan Scholte, Vice Chairman pose for a photo at the TIACA Executive Summit at Miami.

TIACA shifts gears

Over the last few years, The International Air Cargo Association (TIACA) has changed its stance from being purely airline-centric to becoming all-inclusive and with the new set of leaders taking over, the air cargo sector will see change and more interaction between stakeholders to overcome the challenges that face the industry

he International Air Cargo Association’s (TIACA) new leaders have pledged to drive the air freight advocacy agenda, boost the Association’s membership base, and grow its education programme, delegates at the recent Executive Summit (ES) at Miami heard. TIACA must take centrestage to ensure that regulators have essential input from the industry as they take decisions that affect all sectors of the air freight supply chain, according to Sanjiv Edward, Chairman, and Sebastiaan Scholte, Vice Chairman. “TIACA has an essential role to play as the only association which truly represents every segment of the air cargo supply chain,” said Edward, speak-

April-May 2015 I Cargo & Logistics

ing at the ES and Annual General Meeting (AGM). “We must embrace change and work together to overcome the many challenges facing us and ensure a bright future for our industry,” he emphasised. Scholte said that with Edward, he would work closely with members to guarantee a healthy, stable future for the Association, deliver a compelling value proposition, and launch new initiatives to bring on the next generation of industry leaders. “We will grow the membership base and further develop our education programme,” he said and went on to point out that “we must encourage and help develop young talent, and we will be looking to new ideas to do this.” Scholte, CEO, Jan de Rijk Logistics,

and Edward, Head of Cargo Business, Delhi Airport, said they were also looking forward to a highly successful Air Cargo Forum (ACF) in Paris next year (The ACF takes place from October 26 to 28, 2016 in Paris, France). “ACF is a unique opportunity for the global air cargo industry to network and discover new business opportunities, and we are planning an exciting and innovative speaking programme which will showcase TIACA’s ability to deliver essential content,” said Edward. Edward and Scholte formally took over from Oliver Evans and Enno Osinga at TIACA’s Miami ES and AGM. Over 200 air freight decision makers from across the globe took part in the event

NEWSWATCH

and attended a series of panels and discussions focused on supply chain strategies for Latin America, as well as workshops looking at key industry issues including impending new advance data regulations. “TIACA has a bright future and we are delighted to be handing over to Sanjiv and Sebastiaan at this exciting time for our Association,” said outgoing TIACA Chairman Oliver Evans. “We have been honoured to lead the Association over the last two years.” TIACA is governed by its Trustee members who elect the Board of Directors to manage the Association's affairs and establish its policy. The Chairman and Vice Chairman are elected by the Board for two year terms. What is interesting about the current appointments is that neither Edward nor Scholte work for an airline. Both have executive experience with airlines, but Sanjiv Edward now works for an airport and Sebastiaan Scholte for a road freight company. TIACA has always had its spotlight on the air cargo business but essentially from the side of the airlines. However, over the past few years, the association has gradually shifted its focus to include all stakeholders in the air cargo sector: carriers, airports, forwarders, manufacturers and even truckers. The outgoing Vice Chairman Enno Osinga, for example, was the head of cargo at Amsterdam's Schiphol Airport. When Sanjiv Edward, Head of Cargo Business at Delhi International Airport, was named as Chairman of TIACA, with Sebastiaan Scholte, CEO of Jan de Rijk Logistics named Vice Chairman, he had said that he was delighted to take up the position. “TIACA,” he said, “has a rich history and bright future, contributing to the global cargo industry. Together with Sebastiaan, I am looking forward to working closely with an experienced Board and a valuable membership base," he had pointed out. Edward has worked in the aviation industry for over 18 years, including more than a decade with British Airways. He completed his Executive Management Studies from the Oxford Brookes University and also served as a member of the high-level Working Group constituted by the Ministry of Civil Aviation, India to for-

Toronto ready for ACF’18

IACA’s 2018 Air Cargo Forum will take place in Toronto, Canada, according to Secretary General Doug Brittin. The biennial ACF brings together supply chain decision makers from across the globe for three days of networking, discussion, and learning. “We are excited to be bringing the event back to North America for 2018,” said Brittin. “The ACF is a unique opportunity to network and develop new business, as well as a chance for members to help shape our industry by taking part in workshops and panel debates,” said Brittin. The 2018 ACF will take place from the October 17 to 19, 2018 at the Metro Toronto Convention Center. Lise-Marie Turpin, Vice-president, Cargo, Air Canada Cargo said the ACF would be a wonderful opportunity for the Canadian air cargo community to showcase Canada's infrastructure and networks to the rest of the world. “TIACA brings all parts of the industry together and we are delighted that Canada will provide the backdrop for the ACF,” she

mulate the Air Cargo Policy for India. He is one of the founding members of the Air Cargo Forum India and heads its Innovation Group. Scholte has worked in the air freight industry for over 18 years, including with Aeromexico where he was VP Sales. He held senior management roles with Cargolux for eight years from 2002, and took over as CEO at Jan de Rijk Logistics in

said. Toronto Pearson is rated in the top 30 airports worldwide for cargo activity boasting 1.2 million square feet of on airport warehouse space with an estimated 150 million potential customers within a day’s drive. “At Toronto Pearson, we take a great deal of pride in being a major global hub that seamlessly connects people and goods to destinations around the world,” said Ian Woods, Director, Aviation Business Development, Greater Toronto Airports Authority. “That’s why we’re so honoured and excited to be a part of the 2018 International Air Cargo Forum.” Tara Gordon, Vice President, Sales, Tourism Toronto said; “We are proud to have been selected as the host city to the premier air cargo industry event, aimed at improving industry cooperation, innovation, and peer to peer knowledge exchange. We have every confidence The International Air Cargo Association’s conference delegates will embrace all that multicultural Toronto offers and will serve as the ideal backdrop to address current industry challenges and opportunities.”

2010. He holds a Global Executive MBA from the IESE Business School and is also Chairman of the Cool Chain Association. He had said that he would be “working with Sanjiv and the rest of the TIACA Board as well as all of the members”. He had also said that TIACA had a vital role to play representing all sectors of the air cargo supply chain at a time when cooperation was more crucial than ever.

Cargo & Logistics I April-May 2015

FACE TO FACE

“India is the world’s greenest cold chain…” Capt. Pawanexh Kohli, Chief Advisor-cum-CEO, National Centre for Cold-chain Development (NCCD) in a freewheeling dialogue with Ramesh Kumar and Sarada Vishnubhatla. Excerpts: Keen to cut down the wastage of farmgrown fruits and vegetables, the Government has started implementing various schemes to encourage setting up of new food processing industries and cold storages/cold chains. The Central Sector Scheme of Cold Chain, Value Addition & Preservation Infrastructure is being implemented by the Ministry of Food Processing Industries which aims at providing integrated and complete cold chain and preservation facilities without any break from the farm gate to the consumer. The Government initiative saw the establishment of the National Centre for Cold-chain Development (NCCD) after a suggestion by a Task Force set up by the Ministry of Agriculture on Cold Chain Development in India. The Task Force had advocated the establishment of the NCCD as an autonomous centre for excellence to be established as a registered society to work in close collaboration with industry and other stakeholders to promote and develop integrated cold chain in the country for fruits and vegetables and other perishable allied agri - commodities to reduce wastages and improve the gains to farmers and consumers substantially. The main objectives of the centre are to recommend standards and protocols for cold chain infrastructure, suggest guidelines for human resource development and to recommend appropriate policy frame-work for development of cold chain. In conformity with the vision of the Task Force, the NCCD is mandated to recommend technical standards for cold chain infrastructures for perishable food items and undertake their periodic revision keeping pace with technological advancements. It also undertakes consultancy work, certification of cold storages and their ratings, Applied R & D and Human Resource Development Programmes for meeting requirement of skilled man-power of the cold chain sector in the country.

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A farmer, when he fills up a truck will barely be able to fill up half a ton in a ten tonner truck even from his two, three, or five hectares of land. He cannot afford to move half a ton to Delhi from Sikkim or Arunachal Pradesh. That’s the initial barrier. Maybe, he could produce at least two tons from the same land but without market access, what is the point? To break this logjam we want to facilitate through sponsoring freight and packaging and possibly even a market foothold. Hire some space in Delhi Haat for a long term period and allow let us say a group of farmers or a village to access this lane to reach a market like Delhi. Let the Delhites taste what happens over there. Do a little bit of marketing so that there is a demand for volume. This in turn will motivate more of these farmers to collaborate together and achieve higher productivity levels. Everyone wants to reach the high paying market. Why only Delhi? Why not Hamburg or Rotterdam? So, we should set up intelligent supply chains and for example, connect the Kiwi from Arunachal Pradesh to Delhi, as much as the kiwis from New Zealand.

In the existing schemes there is something called a transport subsidy. Many governments have it. The only issue is it’s not reaching out to the right.... No, no. It reaches out. The Agricultural and Processed Food Products Export Development Authority (APEDA) is doing a lot of that to support export shipments. Only thing is we don’t want to cultivate a subsidy culture…if it is endless it tends to become part of the cost structure in the value chain. In the project I just described, the freight will be paid for; it may be viewed as subsidy but it will be declared for a limited time-volume matrix. It will only be provided an opportu-

nity to develop the trade into a market, to test volumes and expand so as to become self-sufficient. It is a project that we want to implement to open up new domestic trade lanes. The consumer will decide if they want more passion fruit, more strawberries from Meghalaya or Arunachal. We will form a temporary bridge to link producer and consumer, thereafter market dynamics must take over…wherever feasible volumes are developed. In a logistics network, the key bottleneck has always been capacity utilisation of transport. Everyone keeps focusing upon capacity utilisation of storage space whereas in a supply chain system, the cold storage is merely a throughput platform. If you cannot justify the base unit load, which is the transport link, there will be no flow of goods and you will have a challenge. To overcome capacity utilisation, unit load capacities have to be developed and a truck or a container is the base unit load. In the fresh produce cold-chain, mix and match is bit of an issue – compatibility angle. Temperature ranges are different; ethylene outputs are different; tainting is a concern, etc. Hence, a reefer truckload will largely remain the base unit to consider in such a logistics network design. In case of frozen goods, compatibility of temperatures is a non-issue as everything is below minus 18°C. Similarly at another level, palletisation needs to happen and the pallet serves as the sub-unit in logistics. In the future, multi-modal containers will be a key transport unit and one hopes that the railway-based entities, both private container companies and public sector, would partake in such movement.

When did the Malda mango movement happen? June, 2014. The West Bengal government

FACE TO FACE

has an annual Malda fest in Delhi and they used to move their mangoes to Delhi in passenger trains. Last year, NCCD financed and guided that entire movement in the cold-chain, right from post-harvest to retail. They were hesitant…

Why this hesitancy? Because the only prior attempt in the cold-chain, a small load experiment, some years earlier had failed miserably. The mangoes on receiving end came out weeping...

What really happened? The experiment did not cater to various protocols, most importantly the fact that over a week-long trip, the mangoes even if kept cool, needed fresh air. Closed in a cool compartment, they just suffocated and the entire lot perished. Since then cold-chain was not trusted and ambient shipment in trains was preferred, even though the mangoes did not last for long at the receiving end.

You brought them successfully by reefer truck? Yes. We brought them by refrigerated trucks sourced from one of our members: even the transporter was reluctant saying that mangoes can’t travel that long (five days). We told them to tell their driver while passing through Patna to open the door and close it. We also said that the

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driver needed to call us before doing that. Two nights later, the driver stopped and calls: ‘Sahab main kholke 10 min. kebaad band karunga’. I said: ‘No, no’... I advised him to open the door, count rapidly upto 10 and close it immediately. Not 10 minutes! That is all it took, 10 seconds to keep the produce alive and fresh. If you keep everything in the most perfect temperature but don’t give it oxygen, it will die. When we die, we ooze out all our fluids. Same thing happen with bananas also. Cold chain is so simple. That’s an innovation, if you like it.

facility in Malda.

Also innovation… Sure. Simple indigenisation resulted in a 60 per cent cost saving. In fact, the entire 20-day mango festival was supplied by cold-chain, almost 25 tons, and the mangoes lasted fresh even after the festival got over. A huge success!

How many times does a driver open the doors en route? It depends on the total load and the respiration rate of the produce. In this case it was only once. Actually, our reefer truck engineers need to incorporate breathing vents and that need will be solved.

Was that all that was needed? No, we had decided to use the traditional wooden boxes for the movement. So, we had the local box makers nail the box sides in a particular manner such that there was no restriction in air flow inside the carrier truck and the boxes could nest – the slats and the gaps had to be aligned when boxes were stowed together. The package must facilitate air flow and not block it. Proper pre-cooling protocol was followed of the entire load at a pre-cooler

Last time when we met you said NCCD is a think tank… Have you moved into an action oriented mode? We are already in action mode on various fronts of training, capacity building, policy redressal, etc. There is also a lot of demand as for us to take part in the ground level infrastructure implementation. Lack of manpower and resources holds us back, as does demand from many that we continue the good work, and not divert attention into what should rightfully be implemented by private entrepreneurs. There is also been a demand that we get more involved in the logistics and agri-business based outside of cold chain. So, here too we contribute on advisory and think tank level. About grassroots’ work, there is one pet project to make sure that our remote areas which grow some of the best produce get access to market. This means spearheading a mechanism where the packaging and the freight is sponsored for them. The biggest bottleneck for any new market entry is how to justify access with initial low volumes. We have already implemented this successfully as a pilot for Malda mangoes into Delhi and hopefully will extend to other pilots, for fixed time duration, soon.

Cargo & Logistics I April-May 2015

FACE TO FACE

properly. It was shocking to me. The industry needed to express and explain and come up with possible solutions but instead we kept hearing a narrow perspective, we keep hearing bad things about cold-chain, without understanding the phenomenal achievements. For one, we are the world’s greenest cold chain and we need to be proud and keep it so. Cold-chain has also empowered us to be counted among the largest exporters of some goods and is what will in future make India the food basket of the world. Today, for the cold chain, the government provides support for establishing modern pack houses, for reefer containers, for dock levelers, for automation, to induct green technologies, and many other relevant components that make our cold chain future ready.

India is the world’s greenest cold chain? Do you mean to say, we are more intelligent than others when it comes to cold chain?

REVIEWING THE FACILITY: NCCD personnel inspecting the cold chain facility

What are the changes that you have brought in since you incubated the NCCD? Primarily, NCCD is said to have brought about a conceptual change in the overall approach towards cold chain. Ever since I came to India — since 2007 — I have been driving home the point that it is not just storage, that cold-chain is about speedy movement of perishables — movement under product specific care. Again, it is not just about a packages or a container. It’s about knowing what is inside the box, about caring for the product. While, today mainstream logistics speaks about getting inside the box, cold-chain has always been doing so. Especially in case of fresh fruits and vegetables, you are handling living things, not inanimate products. Everyone knows that you will not keep garlic with mango because mango will smell like garlic. But nobody realises that you can’t keep asparagus also with mango;

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you can’t keep apple with oranges. If you do that, oranges will start rotting faster. Remember you are dealing with different species. You can’t keep dogs with cats enclosed in a box and expect good results, can you? NCCD is a centre of excellence and tries to translate context into policy. So, for the first time, the government of India has revamped and rationalised its subsidy programmes for the cold chain sector. This concept level change was required. The people of India, the government, have always shown its sincere intent for this sector. The government demonstrated its complete dedication by opening all avenues for cold chain. Frankly, NCCD was not needed if the industry provided the right information; either the industry did not have the experience or didn’t bother. I had spent almost 30 years doing crazy stuff around the world and India had never gotten into this space

A firsthand baseline study was completed involving almost 7000 cold stores in the country and we discovered that 97 per cent used refrigerants that have zero Ozone Depleting or Global Warming potential. This is despite us having the second-largest footprint in cold stores in the world. Most recent reports reveal we have about 120 million cubic metres of temperature controlled space in the country. Only the United States has more than us which is about 125 million cubic metres. In fact, some reports indicate, we may have surpassed that number too. Conversely, in Europe almost 50 per cent of their installed base has high ozone depleting and global warming potential. Of course we are intelligent and innovative. This is the country of jugaad which is the mother of all innovations. I hear a lot of people bad mouth Jugaad, whereas I think it is with an end-use in mind and is the forerunner of all innovation. Jugaad, for me, is raw innovation, by the user and for the user.

If so, is it a myth that the agri wastage is pretty high? The myth is that having cold stores reduces food waste. There is a lot more that

FACE TO FACE

STORED SAFELY: Commodities kept in a cold storage for their safety

is needed; that is what we are always explaining and fighting this myth.

I don’t understand the myth part… Your query itself is rooted in the propagation of the myth. Your query presumes that since we have such a large storage base, there should be no cause for food to be wasted. In reality, the cold store is one part of this logistics chain. The whole essence of all logistics is to minimise interface between origin and destination pairs. Cold stores come into being as a necessity, to serve as a platform to consolidate and deconsolidate, distribute. Yet, without proper post-harvest handling, the cold store alone can do nothing to alleviate the wastage. A cold store can only serve goods already moving in the cold-chain. Today, these are, therefore, mostly used imported perishables that arrive within the coldchain or for frozen goods. They are all in use, but our own domestic produce is not entering them to make optimal use of them as a platform.

Cold stores are already there, but the domestic guys never made use of it? No. To mitigate wastage of fruits and vegetables in their farm-to-fork cycle, we

need the whole cold-chain, not just cold stores. Think of the cold chain as a railway system, it is analogous to the platform. Something has to be on the railway line to reach this platform and that has to come from a freight siding at origin. Foreign goods are already on that railway line. They are in the cold chain. How did they get in the cold chain? That requires pack houses. We don’t have those. Unless I have an entry point, a ticket booth, how am I going to board? To make use of the storage space we need to have the basic entry points in the cold-chain – these are farm gate pack-houses. This is why we need to do more in the back end. The cold store as a distribution hub is a component of the front end.

So, pack houses is the ticket booth? Yes. So, without a pack house nothing can be done about this. The farm produce has to undergo conditioning before undertaking travel. They are the source, points of origin. Imagine if I create 1,000 ice cream parlours in Delhi, will it mean that more milk will be sold in this value added format?

No, there must be factories to make ice cream? Exactly, just creating 1,000 ice cream par-

lors as the front end will not help unless we also make milk collection centres and ice cream factories. If we ignore to make the back-end, the parlours will feed demand with foreign ice-cream, not our own milk. Similarly, in the case of fruits and vegetables we have to create village level factories, which are the pack houses when relating to farm produce.

Are you saying that now there is a greater awareness about packing houses across the country? Yes, and it is growing. There is immense realisation that modern pack-houses and transport are the key areas missing in this value chain. These are a part of the government subsidy schemes and are increasingly being developed. As a standalone cold store makes sense only for certain commodities such as potatoes, spices or goods which do not need the full chain and have long holding capability. The majority of fruits and vegetables last less than four weeks even when in the cold chain. This vast majority of fresh foods need the complete chain and the few weeks time they buy through cold logistics, must be intelligently used to quickly move to markets. To complete the cold conduit, from farm to market, the entire pipeline must be available.

Cargo & Logistics I April-May 2015

FACE TO FACE

What is really required is pack houses. Right? As per our estimates, upwards of 30,000 pack houses. This means one in every 20 villages. With pack-houses the farm gate or village, has the first tool that allows them to safely reach their consumers, who are normally across long distances. Covering the distance means transport. So, the answer is pack-houses with pre-coolers and refrigerated transport is required.

What is the average size of building a pack house? Not even half an acre to house a pack house and a pre-cooler and an appended cold room for staging purposes. It will also have a small area to handle the incoming and for sorting and grading. That’s it.

Average cost of building such a set up will be very low… Government has pretty good cost norms for it. In case of pack-houses and ripening chambers, the cost norms are strategically more open-ended so as to incentivize greater development. Normally when the general public views such subsidy as a funding option, they are incorrect. It should be understood that these are an incentive to move development in a certain direction; this incentive will change or end with time. Subsidy or incentive is not given to merely fill a funding gap for a project, but to develop a sector so that it can eventually contribute back to the exchequer in some form or shape. Tax payer’s money is not just to support someone as an endless story, but to strengthen the entity so that it will become self sufficient and one day contribute back to the exchequer.

Who are getting into this? Mostly private entrepreneurs. The private sector could include entrepreneurs, firms, companies, farmer-producer organisations or private companies built by farmers, and even co-operatives.

What other concepts are you thinking of? We have large production and if we get

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HANDLING COLD CHAIN: A Large Refrigerated Van that is used to transport temperature sensitive commodities

our act right, we can feed half the world. I am 100 per cent confident of that. People say our farmers are not productive. We have visited some farmers. You can give him tools, but you need not teach him farming. Farmer is the life of our country and he knows how to produce. All he says is: tell me, where is the market and I will produce more. We are already producing more than what we can consume and have a problem of plenty today. When I was growing up, I remember we used to get red coloured wheat which was the cattle feed coming in. Everyone said India is not going to survive. Today we have excess wheat, excess grain, excess fruits and vegetables more than we consume and it ends up as waste. Today, we have reached a level where we are talking more about efficient supply chains. Why? All this excess if it reaches the market, prices will get stabilised; if it is able to reach the market, farmers will get better remuneration and the

waste will be converted into money and get monetised. If you have excess market, farmers will produce more. In my opinion, a farmer should reach out to five different markets — not just the one chap in the village. We don’t have a single port designated as a perishable gateway in the country. We are part of the global world: produce in India and sell to the world. For that we need to have gateways — both in and out. If we are selling somewhere we also need to be importing from others; it’s a scientific law of all logistics: if I have outgoing traffic, I must get incoming traffic. Otherwise, it will die out. Eitherways we need designated gateways for perishables.

Does NCCD have a plan to correct this anomaly? Definitely. One such idea is developing over-the-fence ports adjoining LNG handling port terminals. We are one of the largest importers of LNG — natural gas

FACE TO FACE

which comes in liquefied form. This gas when it comes out of the ground, it is at normal temperature. Before transporting it, the gas is liquefied to reduce its volume 600 times. This means that only one ship is needed versus 600 had I transported it in gas form. The temperature in transport is maintained at – (minus) 162 degrees. At the receiving end this cold energy is thrown away before supplying it as natural gas. This discarded energy can be trapped for use in a cold hub, at the port.

Does LNG get converted at port when it reaches here? No. It is still kept in liquid form. Otherwise I will need 600 times the storage tanks instead of one. We are importing almost 25 million cubic metres of liquefied natural gas from three ports and we would need 600 times more area at these ports. That is why it is maintained in liquid form in specially designed storage tanks. But it is re-gasified before it is pushed into the gas grid and for onward delivery.

Since the cooling process is part of freight, it is part of the cost of gas coming into our country. Then we just throw this energy away; we just blow fresh air or sea water over the liquid gas to warm it up, (this is done) not just in India but all over the world. Once it becomes gas, then it continues warming up till about 15-20 degree and it is fed into the normal metal pipelines. Briefly, it takes about a billion dollars to develop a gas field, four billion dollars to develop the liquification or cooling process, about one billion dollar for the transport and one billion dollar for the receiving facility. The biggest cost is liquification and nobody tries to recapture it. We went to Dahej recently where they have half an acre of pipelines. From the liquid tank they take this pipeline, circulate it with huge blowers. It is like Switzerland there: cold because all that cold is being thrown away; water is condensing some of which is collected in a tank of distilled water. We are losing close to 500 megawatts of energy like this amongst four facilities that we run. Every million cubic metres of gas that we handle loses about 5 megawatt, and we have 19 more LNGs coming up. So, we will end up losing 1,600 megawatts of energy. If we capture this stranded cold and pipe it across the fence to an adjoining facility, Jugaad with free energy — world’s first zero CO2 emission facility — is there. By the way when something expands 600 times, it is creating pressure, and this too can be used to generate electricity without fire. This wasted energy can help cold chain: a huge cold chain hub will use only 15-25 megawatts. We have 500 megawatts being discarded. There is enough cold left over to use for other applications, like desalination.

Explain the desalination by cold? It really struck me that the Saudis towed icebergs for using as drinking water. But icebergs are frozen sea water; so do you realise that when sea water freezes it sheds the salt automatically as it crystallises? Using extreme cold to freeze salt water into fresh water ice is called cryo-desalination. And if there is throwaway cold energy, some of it can be used to create such a de-

salination plant.

How did this idea come about? The idea is not new, just a coming together of many things others are doing separately. Japan is creating dry ice out of energy recovered from LNG regasification. Still a lot is being wasted. Petronet in India started using this to air-condition their office facility in Dahej, and cryo-desalination is something one has heard about or read about. We are not super heroes. We just can co-relate and co-ordinate so all of this can happen together. Last year in April, we had thrown this challenge first and various studies have been done. In January this year, Petronet LNG released a global EOI for developing such a port gateway for foods in Dahej. We are seeing this concept gaining momentum.

How long will it take be fore it happens? As long as it takes to build a port. We don’t even need it to be a port-based facility. Frankly, it doesn’t need to have a ship berth. It could be berthing elsewhere and just bring the goods here. Everything comes in containers and destuffed here. This will change the dynamics. Today Mumbai, Cochin or wherever cold chain is there, there are long delays: seven days or more. If you have zero energy cost everyone will divert here and it will be declared as a perishable gateway with necessary clearances. Ministry of Natural Gas & Petroleum has been requested that all future facilities should incorporate this option in its design itself. Whoever partners in this initiative, will be creating history.

Is it going to come up on the western coast? We have proposed four. Cochin, once the grid reaches there it must have it, so south of India is covered; Gujarat, because Dahej is already there. So, it can happen there. Eastern coast has 4-5 locations where LNG facilities are coming up. Whichever comes up first can take this route. Government is not going to build and operate it. This has to be built through the private sector. Companies have to participate. They must have a long term vision.

Cargo & Logistics I April-May 2015

AIR CARGO

“There is no easy competition in our business” Fresh from the launch of freighter services to Hyderabad, Turkish Cargo is looking to expand its services in the country. Tirthankar Ghosh met Ali Turk, Senior Vice President, Turkish Cargo to talk to him about the India market and future plans What was 2014 like as far as cargo is concerned? Was it a difficult year? As Turkish Airlines has grown over the past decade, Turkish Cargo has performed a similar expansion with the flag carrier. Not only has its cargo network expanded, but there has been continuous improvements that has seen progress in its infrastructure and procedural processes. Turkish Cargo is one of the fastest-growing air cargo brands in the world, witnessing a 18.1 per cent tonnage growth in 2013. While cargo and mail shipment volume was 565 thousand tonnes in the January-December period in 2013, Turkish Cargo showed 17.9 per cent increase in the same period of 2014 and reached 666 thousand tonnes.

We understand that this year, Turkish Airlines is targeting to increase capacity by 15 per cent. How much of this rise in capacity will benefit cargo? Please give us some freighter fleet details – how many have been ordered and when are you receiving them? Turkish Airlines has been increasing its fleet year by year and in this year, the capacity growth rate will proceed with higher acceleration. As Turkish Cargo, we basically focus on widebody aircraft (passenger) which will join our fleet. At the end of 2015, Turkish Airlines will have increased its fleet with 13 A330 and seven B777 widebody aircrafts. On the freighter side, Turkish Cargo has 10 freighters in its fleet and in this year one A330F will join our fleet. With an increase in utilizable capacity rate, Turkish Cargo aims to expand its network and fulfill market demand.

With China, Europe and US virtually saturated, do you feel the next hotspot for cargo is Africa? If so, how is Turkish planning to get into Africa? Africa is indeed the next hotspot for cargo. The intensified infrastructural develop-

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ment, discovery of natural resource deposits across African countries has increased demand for reliable transport system for equipment, spare parts, industrial and agricultural products.

Turkish Cargo has laid down plans to meet this growing demand by expanding network across Africa flying over 43 airports in 27 countries and about 10 cargo freighter destinations. We continue to optimize belly-load capacities of our narrowbody flights as well as changing equipment to widebody aircraft. We are launching new freighter destinations to increase capacity into and out of Africa. With its dedicated and value added services, Turkish Cargo has ability to move unique perishables of Africa all around the world meeting with time and temperature criterias. Turkish Cargo Africa Directorate was

established in Nairobi Kenya, to facilitate and ensure the management of clients requests, develop and explore available business opportunities across Africa.

How has the Indian air cargo market fared for you? The Indian cargo market figures — both outbound and inbound 2012-2013 — show that Indian carriers carried and handled cargo worth USD 400 million while foreign airlines accounted for USD 1400 million. The Indian market has shown growth of five per cent in 2014 while its forecast for 2015 is over six per cent. The market is optimistic based on the blueprint from the current government. The steps taken by the government towards better infrastructure and efficient logistics have given hope of a good future for the Indian cargo market. The Indian air cargo market has fared well for us as we have now opened a new cargo terminal in Istanbul to facilitate the demands of the Indian cargo market, primarily pharmaceuticals and lifesaving drugs.

Are you looking at any more Indian destinations — cargo-wise? According to our plans of 2015 and depending on our aim to develop Turkish Cargo, new routes are all part of our plans. Therefore we are observing the Far East market routes which are included to this prospect. On the other hand, since Turkish Cargo already has launched freighter flight to Mumbai, Delhi and Hyderabad, our main goal for the short term is to keep the sustainability of the destinations in India. New destinations may be possible in the midand long-term plans.

Turkish Cargo launched freighter services to Hyderabad. How important is Hyderabad for you? Did you launch the services looking at the pharma business?

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South India has been a very important sector to us. We started off with freighters to the Hyderabad market to service the whole of the south, thus catering to feeders from Chennai, Bengaluru, Cochin, etc. We did see high potential from Hyderabad market: apart from the pharmaceutical business, there is Hyundai, auto parts, vaccines, etc. We will soon be starting second freighter services into Hyderabad to balance the market demand during the whole week.

What are the latest partnership deals you are working on? Now that Air India is a member of Star Alliance, will it help in boosting cargo? On the cargo side, recently, we have S.P.A. with TNT for USA both inbound and outbound traffic and to help us feed these lines. Star Alliance is generally more focused on passenger side than cargo shipments, but we are sure that the weight of cargo business in Star Alliance will increase.

Can you please share some details about the new airport you are building at Istanbul, the third and the largest? Detail us on the cargo terminal you recently opened in January 2015? We are glad to inform you that the construction of the third and the biggest airport in Istanbul has started. This airport, which will be completed in three phases will be the largest one, built on the European side, near the northern part of the peninsula. Expected to be fully operational by the end of 2017, this airport will have six runways which could be used at the same time. The terminal will have a capacity to carry 150 million passengers and six million tonnes of cargo per year. The terminal will spread

across a sprawling 150,000 sq metred surface, making it seven times bigger than the already existing two airports. The new facility at our Istanbul airport is a state-of-art one, providing the latest technology in handling and transferring of cargo. The facility has been designed to meet international standards and includes facilities like a larger cargo admission area, specialty cargo storage areas, combined operation areas, accelerated cargo admission and operational processes, a single-process flow across the operation, an operational area with improved functionality, increased storage area volume and a comprehensive and higher quality security system. The facility boasts of handling 1.2 million tonnes annual tonnage capacity. It has a total floor area used (Airside and Landside) of 71.000 sq m and a closed warehouse area of 43.000 sq m. Its 39 special needs storage areas include facilities for cold storage, handling of live animals, dangerous goods, vulnerable cargo, valuable cargo and radioactive substances. It has 29 rooms with various temperature controls. Four different types of temperatures could be maintained here like -15 - -20 °C, 0 - 4 °C, 2 - 8 °C, 15-25 °C, which will now give us an edge to store and transport various perishables and pharmaceuticals. Though we already handled some pharmaceutical products, this new state-of-art-technology would enable us to capture the bigger market now.

What is the latest on the Information Technology front as far as Turkish Cargo is concerned? Turkish Cargo is currently doing e-awb with dozens of valuable forwarders which covers more than 50 per cent of total cargo

volume within Turkey. Also Turkish Cargo has focused on COMIS (new core application) Project which will go live in the second half of 2015. After the implementation of COMIS Project, Turkish Cargo expects an increase in the number of e-AWBs for all routes and which is more than 25 per cent of total AWB volume (import & export).

What do you wish to say about the competition from the big cargo players from the UAE? I can say that they are hard to compete with but we have advantages in not only transit cargo but also cargo in and out of Turkey. There is no easy competition in our business. One must be the best to succesfully compete.

What are the challenges that you see of doing business in India? In a recently-published WB report, India is ranked 132nd, in terms of ‘ease of doing business’ and a disheartening 166th, in terms of ‘starting up new businesses’. The major challenges one faces while doing business in India are lack of good infrastructure, insufficient logistics, delay in approvals from regulatory bodies, lack of implementation readiness and a complex tax regime. The government has assured the business comunity to remove all the hindrances and work towards encouraging people to start buiness in India. The Prime Minister of India is determined to achieve his dream of ‘Make in India’. The challenges we face doing business in India are mainly uncalled strikes and heavy congestion faced during clearances, insufficient facility, and manpower issues.

Cargo & Logistics I April-May 2015

COVER STORY

Last Mile’s Last Man

No one moves it better than India Post. The good old ‘Bharatiya Dak’ has seen many ups and downs in its 150-year old existence. Years after many of its ubiquitous products like the postcard, money order, or the blue inland letter became a part of the past, India Post is rising from its ‘hibernation’ and making a strong comeback with one of the most popular services in today’s digital world: e-commerce. Sarada Vishnubhatla found out how India Post, especially the Karnataka Circle, is aggressively working towards grabbing back its relevance in the fast growing digital world of information exchange

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COVER STORY

ince its birth some 150-plus years ago, India Post has gradually built its massive infrastructure and huge network with more than one-and-ahalf lakh post offices, 90 per cent of which are in the rural areas. The numerous arms of this giant are now offering olive branches to e-commerce businesses happily. No one e-com business can think of building such a huge empire in today’s times — requiring large scale investments and time. Combined with India Post’s IT modernisation plans requiring investments close to `5000 crores, they are the best logistics partners to help grow any e-com business. Some of the e-com giants like Amazon, Flipkart, Snapdeal, Myntra are already hitching a ride with India Post. It was Amazon

that first approached India Post in 2012 to reach out to its customers residing in Tier3, 4 and 5 cities in the country. Said Veena Srinivas, Post Master General — Business Development & Mails, Karnataka Circle, India Post, “Amazon had approached us but in the case of Flipkart, Myntra and Snapdeal, we approached them. We recognized that this is our future and secondly, most of them have headquarters in Bengaluru. Also, there is pressure from New Delhi that you reach out and do it.” Amazon sent out 7000-odd packages in January 2014 using India Post’s delivery system. That number went up to 85,000-plus packages in October 2014. And India Post rose to the occasion. Srinivas shared, “They find 98 per cent delivery efficiency with In-

WORKING AGGRESIVELY: An outside view of office of Chief Postmaster General in Bengaluru

dia Post which they don’t find with any other service provider.” Till now, Amazon has been giving India Post deliveries to Tier-3, 4 and 5 cities. She said, “These are remote areas. There is no other presence there. So we have offered our services to Tier-1 and 2 cities along with their existing service providers as a competition. We are not seeking exclusivity and they are willing to try out. Though Karnataka Circle spoke out on this, they have tried out the same with Mumbai also.” India Post’s e-com business touched `100 crore in the last financial year and is gearing up to reach `200 crore target during this year. Srinivas elaborated the scenario in the Karnataka Circle, “We are standing at a revenue of `1 crore from all our e-com customers put together every month since January 2015. I would say from April to December 2015, it should touch `2.3 crore.” With the air cargo business increasing in line with more e-com deliveries, India Post has desired owning dedicated aircraft. The three freight aircraft that India Post had taken on lease from Air India finished its four-year period in 2010. Since then, India Post has been facing delays in its deliveries via air cargo. Earlier in April 2015, the Chief Post Master General of India Post’s Karnataka Circle, M S Ramanujan sought dedicated aircrafts to haul its cargo to be able to achieve smoother same-day deliveries even outside Bengaluru. Though the Union Minister of Communication & Information Technology Ravi Shankar Prasad is not yet known to have responded to the demand publicly, Srinivas elaborates, “This is a decision that can be given only by the headquarters. We airlift everything except for the load related to Karnataka, Chennai or Hyderabad, which I can send by surface transport also. Currently, we are seeking dedicated space in the aircrafts which we can purchase irrespective of whether it is used or not, we pay. In passenger aircrafts flying certain sectors, e-com packages do not get priority lifting because for them the priority is the passenger traffic. A few cargo airlines are speaking to us offering service but they are going to start only in August.” Only if India Post can pass on the cost of dedicated space in aircrafts to the e-com businesses does it beContinued on page 26

Cargo & Logistics I April-May 2015

COVER STORY

we got in touch with Flipkart, Myntra and Snapdeal in mid-2013 because no one can disregard the number of pincodes that India Post can offer. In August-September 2014, we pressed upon Amazon to give us deliveries to Tier-1 and Tier-2 cities as well apart from the Tier-3, 4 and 5 remote areas for which there is no other presence apart from us. So, they are now willing to try us out for Tier-1 and 2 as well, along with the existing competition.

How successful has it been with Amazon? JOINING HANDS: Veena Srinivas in an interaction with Amazon representatives

“India Post’s delivery efficiency is the best” Amazon, the e-commerce giant with its headquarters in Bengaluru, Karnataka, may have been the first one to tap into the advantage that India Post has to offer owing to its wide network of post offices and services in reaching out to even remote areas to deliver its products, but it did not take India Post — Karnataka Circle long to recognize the business development opportunity. Quick thinking led India Post — Karnataka Circle to approach other e-commerce businesses like Flipkart, Myntra and Snapdeal to offer its last mile delivery advantages. Currently, the Karnataka Circle records `1 crore worth of revenue with e-commerce businesses on an average in a month Sarada Vishnubhatla met Veena Srinivas, Post Master General — Business Development & Mails, Karnataka Circle — India Post, for an in-depth interaction. The bespectacled soft-spoken lady has spent two years at India Post — Karnataka Circle in Bengaluru prior to which she was in Kanpur and in Mumbai.

What prompted India Post to offer its last mile delivery advantage to e-commerce

April-May 2015 I Cargo & Logistics

businesses? India Post — Karnataka Circle, under our Chief Post Master General, M S Ramanujan, wanted to opt for it because parcels are the future of our country as against documents which will not grow. Amazon approached us in 2012 and subsequently their warehouse facility came up in Kadugodi. They wished to have booking facilities with us. We did what is called data integration. Based on the experience with Amazon,

Amazon took one of our 37 nodal centres and two pincodes and started injecting packages directly and we would distribute them through the postmen the same day. It started off with an upper cap of around 100 packages but it was not building up despite being successful. They know that with us they have been able to touch 98 per cent of delivery efficiency which they have not found with any other service provider but our drawback was the updation of the system though the packages are delivered promptly. So, what we do is we share an Excel file and inform the e-com customer that the package has been delivered, which they are also comfortable with. But in the case of same day delivery, I would like to see it in the system itself rather than someone sharing it to me. So, we started a monitoring cell in Karnataka which tracks on behalf of all the e-com customers to help them give what they require as the turnaround time report, escalation report and the like.

Any modifications that you had to undergo to service the e-commerce businesses? Each business follows a different model. In the case of Amazon, they are following ‘Book Now Pay Later’ model. So, they have a bank guarantee. Yes we also have become a little flexible. As per the rules if someone books at location A and location B within Bengaluru, you need two different account numbers because our system does not integrate the places and cannot raise a single bill. But the customer is not comfortable with that. So, we are a little flexible about that and we allow a single bill and the rule does not say that you cannot do it.

Tell us about your expansion plans and the challenges you are facing.

COVER STORY

Our 37 nodal points deliver to all the 104 pincodes. Amazon expanded from two pincodes to 10, and post-February 2015 they wanted to expand to all 104 pincodes and we are happy to welcome them. We had to identify space because the deliveries have to move to 37 locations from one booking point, so we decided on the space at Bengaluru GPO which was inaugurated on April 02, 2015 by the Honourable Minister and we started delivering on April 07. But when it comes to booking, say if it happens at Museum Road for Myntra, for Snapdeal at GPO, for Flipkart at Kadugodi post office and for Amazon at Jayamahal, what we did was that we moved Myntra, Snapdeal and Amazon to one place for booking, so it’s a dedicated e-com booking centre. Then Flipkart also was moved in after sometime. Once all these stabilised, we worked on data integration for all of them. One challenge is better synergy among India Post circles. We organised a workshop in January 2015 and invited representatives from 20 circles, though North East could not attend. We identified single point contact in each circle who will respond to all e-commerce queries, be it booking, pick-up or delivery. Now all the circles are escalating their issues to us but we cannot take care of all their issues. They ask us to collect information whether an article has been delivered or not, if something has been picked up or not or say, the weight is not tallying. The problem, for instance with Myntra, is that if you do not get a package delivered within the time allocated and information shared, that pincode will be blocked by the service provider, so I will not get packages to deliver to that pincode. So, sensitisation has to happen right up to the field in all circles. It has trickled down to ground zero in Gujarat, Punjab, West Bengal and Haryana to some extent.

Doesn’t this kind of big sister act drain your resources, energy and time? It does but again it’s a Catch-22 situation. If I don’t do it, the business will suffer. Another issue is that these businesses like Amazon are not going to invest in Karnataka particularly Bengaluru anymore, they are moving to Hyderabad. Why? Because of state government tax issues. So, for us this is another challenge that we have to

offer better service so that even from Hyderabad Amazon would like to inject their business into our system here in Bengaluru. The e-com business is growing at 2 per cent of the total volume. They want to give us more.

How about owning your own aircraft? We are not looking at that but we want dedicated space in the aircrafts. Generally, we use Air India, Jet Airways, Spice Jet and IndiGo. It is a space that you purchase and keep it irrespective of whether you use it or not you pay for it. Some cargo airlines are talking to us but it will only start in a few months, say August. And e-com businesses like Myntra want dedicated space, so we are also talking to them in the same vein that irrespective of whether you give us business on a particular day or not you will have to pay so that we, in turn, can speak to the airlines.

When did this idea occur to India Post Karnataka? About 15 days ago.

Tell us about India Post’s ability to same day e-com deliveries. If someone in Mumbai or Delhi has booked a package via e-com outlet, which is deliverable in Bengaluru, so they will bring it into Bengaluru in the morning, then inject it into our system and ask us to deliver. So, technically, it will not be the same day because I as a customer have booked it yesterday. But if I were in Bengaluru and I have booked it from here, then it would be of that day. That is why we call this as Metro Delivery. Now even Myntra and Flipkart have evinced an interest.

How do you help them reach out to difficult areas, like North East or even Jammu & Kashmir? They don’t have any other mechanism. But we are clear that we do not guarantee delivery on a particular date. North East does not have any other entrance except via Kolkata, there is no direct flight.

With increase in business, is India Post looking at building new warehouses? No we are not building new warehouses but we are identifying places where bookings

and deliveries can occur. Now we have segregated both of them. Bookings meant for delivery in Bengaluru happen from GPO and the bookings for other than Bengaluru at the moment is occurring from Jayamahal premises which partially will shift to Yelahanka in sometime. At the same time I would like to develop Peenya Industrial Estate where we have a packaging unit.

Even though e-com business is currently standing at 2 per cent of your total revenue, don’t you think you will be forced to find new storage space? E-com business for us will grow but most of the time if we can take care of the dispatch, we do not need to store. For example, for Metro Delivery, the load reaches us at 9 am, we book it, sort it and by noon we are able to dispatch. The loading starts with 29 vehicles for local deliveries. Usually it is said that government departments are not prepared to take up volumes but here we are prepared and the e-com guys are not. On April 7, 2015 when we inaugurated our Bengaluru GPO as the e-com booking centre, Amazon had business for only 14 pincodes as opposed to our preparedness for 102.

And Snapdeal? Snapdeal has offered to talk to us but their volumes are less and their preparedness for understanding and studying another organisation, how to use it – it is not as responsive as the other three.

What is the e-com business growth rate for India Post in the next one year? For Karnataka Circle, I would say from April to December, 2015 my total e-com business revenue should be about `2.3 crores. Since January 2015 every month my monthly revenue has touched `1 crore. If I can introduce CODs as well... but no e-com businesses are booking them with us. We need to upgrade.

Any last words? If we are sensitized enough at all the 25000 pincodes then I am sure the e-com business will grow at the rate of 20 per cent per year because it has been said over and again by them that India Post’s delivery efficiency is the best.

Cargo & Logistics I April-May 2015

COVER STORY Continued from page 23

come viable for them. The Economic Survey for 2014-15 presented in the Parliament by the Ministry of Finance indicated more than 50 per cent growth for the e-com business in India in the next five years. As against this, India Post, especially the Karnataka Circle, is facing challenges ranging from system upgradation, to their dependence upon the headquarters for crucial decisions. Srinivas asks, “In Karnataka Circle, the e-com business is growing at merely 2 per cent of the total volume. The businesses want to give us more. But are we technologically capable of taking that much volume? Will we be able to share the information that they want? Secondly, the reaction at the delivery point is important. I mean are they able to deliver and give the scans like turnaround time reports or escalation reports to e-com customers. Another point is most of their parcels are Cash On Deliver (COD) mode and this is not yet stabilised in India Post pan India. We have an e-payment module in which the server is called at night and the transaction happens the next day. With e-payment stabilised in Karnataka Circle, COD is just a breath away.” India Post Karnataka Circle’s openness to take on more little by little was evident in early April 2015. Srinivas said, “We were prepared for delivering to 102 pincodes out of which Amazon could give us for only

14. With Flipkart, I remember when I met them, I told them I can offer 25000 pincodes and asked them how many did they wish to operate on. They knew it yet they were still surprised as to how we integrate data. So, usually it is the government organisation which is found lacking in the response, but here it is the opposite.” Going past their teething troubles, Amazon today reaches out to its customers residing in 19000 out of 25000 pincodes offered by India Post, across the country. In just a two-year period, India

Post has collected roughly `280 crore as COD amount and paid the e-com businesses. As for Karnataka Circle, it is now pushing 2000 packages from Amazon in a month as against the initial volume of 1500-2500 as was initially decided upon. Even with all the money that is being pumped into the e-com businesses, the e-com companies are highly dependent on India Post to reach out to the country’s furthest extremities like the North East or Jammu & Kashmir. The uncertainty factor whether it is

Scope for expansion •

•

Portals catering to online shopping raised over US$ 4 billion in 2014. More than 1200 new ventures have opened up increasing the size of the pie, which can benefit India Post, if it acts fast and overcomes its various challenges. Big e-com companies like Flipkart followed by Snapdeal and Amazon have touched US$ 1 billion in sales. The market pie has further increased for India Post to dig in. Amazon intends to invest close to US$ 2 billion into the company’s India operations. Even if the company shifts its headquarters to the neighbouring Hyderabad, Karnataka Circle India Post hopes to keep its business with Amazon going full steam.

April-May 2015 I Cargo & Logistics

DELIVERY ON DEMAND: A view of General Post Office (GPO) in Bengaluru

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COVER STORY

READY TO DELIVER: Packets and Parcels at the GPO in Bengaluru being loaded on a Mail Motor Service van for dispatch and delivery

the weather, terrain or even socio-political scenarios, these states are yet to become fullfledged players in the e-com game. Srinivas said, “Connectivity — whether of terrain or communication — is a major issue. The response time is slow and then there are issues of not having much manpower in these areas. You cannot expect to even speak to the person on the phone if there is only one person taking care of multiple circles. In the North East, rail network is a constraint, so is road and how many airlines do you have flying in frequently.” Despite having a monopoly of existing network in the North East or Jammu & Kashmir, India Post is aware of the attempts of e-com companies to acquire companies in these areas to set up their own supply chain logistics. Srinivas sounded confident when she said, “Even if they set up, at the end of the day, they are going to face the same difficulty. It should be about sharing the total business.” Sound advice! Especially in the face of the fact that delivery to the North East, for example, takes more or less a week’s time — whosoever may be the deliverer. Specific training to postal staff in han-

April-May 2015 I Cargo & Logistics

dling e-commerce procedures like receiving or paying cash and ensuring same day deliveries, at least locally, is a crucial step for India Post to undertake. Srinivas stressed more on sensitizing the staff, “Making them to understand that they cannot pass the buck in handling complaints is important. We have our own internal training that we organise because an outsourced person may not understand the nuances. We have trainers in each training centre in every district training our clerks and inspectors to become trainers themselves. They train our staff with software, products. Our training center in Mysore caters to three states giving mid-career training as well.” With most of the e-com giants including Flipkart, Amazon and Snapdeal already giving their expansion plans to India Post headquarters in New Delhi, the Karnataka Circle of India Post is all set to take on the business that will come its way with its booking centres in Vimanapura, and Jayamahal and finally an e-com centre in Yelahanka for all outbound air cargo traffic to open in a month or so. News reports point out that the e-com companies are on the lookout for more space

to store their wares. Can India Post find itself obliging them? Srinivas was candid when she said, “India Post does not have the space to offer them. Also it is not our core area anyway. Revenue wise also it does not make sense because the e-com companies do not pay much and besides, their turnaround time is rapid. So, they also try to move directly in the market from vendor to vendor, like Snapdeal or eBay, which work on market model.” Last man standing, here, has to be India Post pan-India. Even the world over, e-commerce has changed the business scenario for the state owned postal departments from becoming one of heritage value only to becoming useful and more than relevant. Like India, developed countries around the world have also started making inroads into their countryside to maximize their business opportunities. This year, India’s total e-commerce logistics market is expected to touch `7200 crore. The key to servicing such expectation lies in the hands of our ubiquitous India Post with its ability to execute the last mile and same day deliveries whether locally or across the country.

SPOTLIGHT

Freight train, freight train goin’ so fast That is what Railway Minister Suresh Prabhu has in mind even though he is burdened by financial and other constraints. He has in hand reports from two separate committees that have suggested ways to boost growth in freight and passenger traffic HEAVY AND LONG: An Indian railway freight train with loaded containers

hen Suresh Prabhakar Prabhu, Minister for Railways, presented the White Paper, Indian Railways – Lifeline of the nation, a few days before the Railway Budget, he enunciated the problems that the organisation was going through and what could put it on its course of recovery. He pointed out: “Indian Railways… traverses the length and breadth of the country providing the required connectivity

and integration for balanced regional development. The system never rests; it has been up and working unceasingly for the last several decades. It is an integral part of every Indian’s being. It is one of the pillars of the nation.” He continued: “Indian Railways has suffered from considerable under-investment during the last several years. As a consequence, capacity augmentation has suffered and so has the quality of service delivery. Resources have been insufficient

for improving customer satisfaction and introducing technological improvements. Investments in safety have also been insufficient. This is a vicious circle which I desire to convert into a virtuous circle by bringing in greater investments which will generate higher revenues and better service delivery.” He went on to say that “despite its problems, Indian Railways is not down and out; it is the only organisation in the Government of India that pays for its wage bill,

Cargo & Logistics I April-May 2015

HEMANT RAWAT

SOPTLIGHT

WEIGHTY: Packages kept at the New Delhi railway station ready to be loaded on a train

pensions and working expenses in its entirety. It also accounts for replacements and depreciation like any commercial concern should and pays a dividend on the capital it gets from the Government of India”. Clearly, the Minister has his work cut out. While the organisation is hamstrung by lack of capital, it has had to bow down to populism — almost every Railway Minister has introduced new trains to pamper their own constituencies and states. Today, freight provides the subsidy to keep passenger tickets low. Result: Railway freight is more expensive than road transport. To make up for the `26,000 crore that the Indian Railways lose on subsidising passenger fares, Prabhu has to push freight rates down. Indeed, that is difficult to achieve in a year but as the White Paper and the Railway Budget has shown, Suresh Prabhu has found out the ways to do it. While he has advocated privatisation, he has used the savings from cheaper diesel — totalling between `12,000-`15,000 in the 2015-16 fiscal year, starting on April 1, 2015 – and has asked the finance ministry for an extra `20,000 crore to invest in track and rolling stock upgrades. As for freight, while exempting salt, the Minister has enhanced

April-May 2015 I Cargo & Logistics

rates on carriage of cement, coal and coke, iron or steel and petroleum products by 10 per cent, for diesel and limestone a marginal reduction has been done through re-classification of goods and distance rationalisation. While the effects of the Minister’s initiatives will be seen through the year, it may be mentioned that the operational heads of the railway zones met recently at Puri in Odisha to discuss strategies for traffic, infrastructure, capacity augmentation and logistics for 2015-16. The two-day long all-India Railway operations and strategy meet was held came on the heels of the report of Committee on Traffic Optimisation which was submitted to Minister Suresh Prabhu on March 27, 2015. The committee had been set up to identify bottlenecks for capacity augmentation and suggest measures to enhance traffic growth up to 15 per cent. In the last four years, the freight loading growth has hovered around 4 per cent. The committee also suggested action plans for implementation by the zones during 2015-16 for optimisation of traffic output. It is not that the railways have not earned from freight: Freight earnings were a little over 65 per cent of railways’ total

earnings of `1,44,167 crore in 2013-14 and 65 per cent of the financial year 2014-15’s estimated total earning of `1,63,450 crore. Earnings from freight grew 12.7 per cent to `95,136 crore between April 2014 and February 2015 (it was `84,379 crore in the corresponding period of 2013-14). The rise was helped largely by higher freight rates and increased volumes in coal and iron ore. Freight tonnage was 966 million tonnes (mt) in 2014-15 as compared to 953 mt in the earlier period — a rise of 4.5 per cent. The Railway Ministry had raised freight rates by 5.8 per cent in April 2013, 1.7 per cent in October 2013 and 6.5 per cent in June 2014. The Ministry also announced an average three per cent rise in freight rates effective from April 1, 2015. Also, a congestion surcharge of 10 per cent is being levied on all goods traffic, including containers originating from ports, since November 2014. The Ministry has budgeted for freight traffic to grow from 1,101 mt in 2014-15 to 1,186 mt in 2015-16. Of the additional 85 mt, almost half will come from coal, the largest component of railways’ commodity traffic basket. The railways has also revised its estimated freight earnings for 2014-15

to `1,06,927 crore from the `1,05,770 crore estimated when the budget was presented a year before. In 2015-16, freight earnings have been budgeted to register a 13.5 per cent jump to `1,21,423 crore. Enhancement of railway traffic – both freight and passenger – is uppermost on the government’s agenda. In fact, two committees were formed to identify factors and issues affecting the growth of traffic and suggest plans of action. Both committees have given in their reports that identify specific bottlenecks requiring urgent attention. The Ministry of Railways had constituted a Committee on February 13, 2015 to identify factors and issues affecting growth of traffic (Freight and Passenger) and suggest a plan of action for Traffic Optimisation in the short term (during 2015-16) and the long term (2018-19). The Committee was given the following terms of reference: • To review the traffic growth both passenger and freight from 2010-11 to 2014-15 & constraints in achieving higher growth during this period; • Identify bottlenecks which can be removed in short term (during 2015-16 and long run term (upto 2018-19) for capacity augmentation; • Suggest innovative measures to enhance through put to achieve traffic growth of upto 15 per cent in short and long term periods; • Develop a brief action plan for implementation by Zonal Railways during 2015-16 towards optimisation of traffic output; and • Suggest policy changes required to be undertaken by Railway Board to enable achieving higher traffic (Freight & Passenger) output. The Committee was asked to submit its report within a period of six weeks from the date of its constitution. On receiving the report, Prabhu said that the Committee had pointed out the potential of growth for Indian Railways. The roadmap indicated that Indian Railways freight loading had the potential to grow between 9 to 15 per cent in the next 4 years against the growth of around 4 per cent recorded during the last four years. The Railway Minister also said that the measures suggested by the Committee would be implemented in a

HEMANT RAWAT

SPOTLIGHT

GREAT POTENTIAL: A freight train loaded with coal in Lajpat Nagar, New Delhi

mission mode. The committee observed all factors impacting the growth of the Indian Railways including development of infrastructure, augmentation of capacity and saturation levels of all high density routes. It also identified specific bottlenecks requiring urgent attention including completion of last mile projects, specifically those connected to throughput enhancement i.e. doubling of traffic facility, signaling and electrification works. The Committee also reviewed growth for various core sectors requiring high demand for transportation of selected commodities including coal, iron ore, steel, fertilizers, foodgrain, cement, etc. Also assessments were made to meet demand for transportation of coal, iron ore and containers. The report noted: “The potential estimated looks at growth of 9 to 15 per cent during the next four years. The Great Leap Forward would be achieved only with completion of the Dedicated Freight Corridor. In the ensuing period various other capacity augmentation works will have to be completed, system improvements requiring changes in rolling stock and infrastructure maintenance practices will have to be looked at, capacity of terminals is to be augmented, utilisation of alternate routes will have to be rationalised, wagon capacity scheme requires liberalisation, private freight terminals have to come up and rating structure have to be revised to provide more incentives in empty flow direction.” Meanwhile, another panel headed by Bibek Debroy, was set up to suggest re-

forms and restructuring of Indian Railways. The panel recommended allowing private entry in both passenger and freight operations, setting up of an independent regulator, a separate policy making unit for implementation and rationalization of railway zones. Currently, the Indian Railway Finance Corporation (IRFC) which borrows for the railways, owns the rolling stock procured and receive lease rentals from the transporter. Under a public-private partnership (PPP) model, the private companies as train operators can realise revenue as passenger fares and freight from the users and share it with the railways as track access charges, experts said. It also suggested setting up a regulator — with statutory backing and independent of the Railway Ministry as well as the Railway Board – for fixing tariff, determining cost of service, managing track access, setting technical standards among other things, after private players were allowed to run freight and passenger trains. The panel said it could be called the Railway Regulator Authority of India (RRAI). The Debroy panel has cautioned against leaving the implementation of its recommendations on the existing directorates of the Railway Board. “Otherwise, this report is bound to confront a fate similar to its predecessors. We would suggest that the implementation ownership of this Report should vest in the Minister of Railways alone, with an appropriate reporting mechanism to the PMO (Prime Minister’s Office),” the report said.

Cargo & Logistics I April-May 2015

NUMBERS

15.9

PER CENT GROWTH IN CARGO FOR KIAB Kempegowda International Airport-Bengaluru (KIAB), operated by Bangalore International Airport Limited (BIAL), witnessed 15.9 per cent growth in cargo in the fiscal year 2014-15, led by 25.3 per cent growth in domestic and 10 per cent growth in international cargo. Supporting Karnataka’s vision of becoming a pharma hub, the airport cargo partner Menzies Aviation Bobba inaugurated its Pharma Cold Zone in 2014. KIAB’s cargo partner Air India SATS is expected to set up its ‘AI SATS CoolPort’ perishables handling centre at the airport.

PER CENT JUMP IN THERMAL COAL IMPORTS India’s 12 major government-owned ports handled about 77.74 million tonnes of imported thermal coal during the 11-month period of April-February, up 19 per cent Year on Year (YoY), the latest data from the Indian Ports Association (IPA) showed. However, cooking coal imports over the 11-month period of the current fiscal year fell to 29.16 million tonnes, down 1.6 per cent, the data showed. Paradip Port on the east coast handled the highest volume of thermal coal imports during the period, at 27.41 million tonnes, up 20 per cent on the year.

MORE PORTS TO HANDLE IMPORT OF VEHICLES

The Central Government has decided to allow two more ports, APM Terminals, Pipavav Port in Gujarat and L&T Kattupalli Port near Chennai, to handle import of high-end cars/vehicles, taking the total number to 14. At present, six seaports and three airports are allowed to handle import of these high-end vehicles.

April-May 2015 I Cargo & Logistics

`6,100 CR EXPECTED FOR SHIP-BUILDING

The Gujarat Assembly was recently informed that the government of Gujarat expected to attract private investment of `6129 crore in the form of ship-building and repair projects in the state. The state government said that it had received 14 applications from different players in the ship-building and repair industry, till March 31, 2014. There were already a few players in the ship-building industry in Gujarat: Alcock Ashdown in Bhavnagar, ABG Shipyard Limited at Magdalla, Modest Infrastructure Private Limited in Bhavnagar, L&T Shipbuiding near Hazira and Pipavav Defence and Offshore Engineering Company Lim-

ited at Pipavav. Apart from the investment in ship-building, the state is expected to attract investments worth `3,800 crore in Phase-I of the Nargol port project which is being developed in South Gujarat, State Minister Bhupendrasinh Chudasma said. According to the minister, the port was awaiting six major clearances including those for Coastal Regulatory Zone. Once the clearances come by July 2015, the work on the port will begin in April 2016. The port is expected to benefit local industries including those in plastics, paper and pharmaceuticals sectors.

MT CARGO HANDLED BY CHENNAI PORT

Chennai Port has crossed 50 million tonnes (mt) mark by handling 50.29 mt of cargo as on March 15, 2015, ten days earlier compared to the last fiscal. The major driving factors were the increased handling of containers, ferrous slag, limestone and steel, highlighted a release. Efficient planning, effective handling and cooperation from the trade also contributed to this noteworthy achievement. The Chairman of Chennai Port Trust appreciated the efforts put in by

According to a notification issued by the Directorate General of Foreign Trade (DGFT), new vehicles are imported through air cargo complexes in Mumbai, Delhi and Chennai, and three Inland Container Depots in Talegaon, Pune, Tughlakabad and Faridabad. The ports include Nhava Sheva, Mumbai, Kolkata, Chennai, Ennore and Cochin. Even though India is a major automobile hub, the number of commercial and passenger vehicles imported into the country

the Port’s employees and other stakeholders towards this accomplishment.

is small. During April-November 2014, a little over 1,200 trucks and buses were imported into India.

NUMBERS

101 WATERWAYS TO BE DECLARED AS NATIONAL The Union Cabinet, chaired by the Prime Minister, Narendra Modi, has given its approval for the enactment of the legislation to declare 101 additional inland waterways as National Waterways. This will create a logistic supply chain with intermodal (Rail, Road and Waterways) connectivity. It would contribute to the GDP by opening up business opportunities in the area of dredging, barge construction, barge operation, barge repair facilities, terminal construction, terminal operation, storage facilities, providing modern aids to day and night navigation, tourist cruises, consultancy, training of manpower for manning barges, hydrographic survey, etc. Investments in all these business areas will create numerous opportunities for employment and economic development and reduce pressure from the already over-loaded, congested and costlier surface modes of transport, according to a release. Detailed business development studies are being carried out under the Jal Marg Vikas Project for identifying all business opportunities and quantifying anticipated investments and employment opportunities.

CONTAINER VESSELS FOR SHREYAS SHIPPING

Shreyas Shipping and Logistics Limited is planning to acquire four ships by 2017. “The Board of Directors of the Company have approved a plan for acquisition of 4 container vessels ranging from 1700 TEU (Twenty Foot Equivalent Units) to 2500 TEUs over a period of 18-24 months,” the company said in a statement. Shreyas Shipping and Logistics claims to be India’s first container feeder owning and operating company. It commenced its operations in 1994 primarily to fill the gap for feedering of containers between Indian ports and international transhipment ports such as Dubai, Jebel Ali, Colombo and Singapore.

80mn

EURO CARGO TERMINAL FOR HELSINKI AIRPORT The Finnair board has approved a new €80 million cargo terminal for Helsinki Airport. Construction work will start on a 35,000 square metre site near the Finnair technical operations area, with an opening scheduled for spring 2017. The terminal is Finnair’s second largest investment after acquisition of new A350 wide-bodied aircraft and it is being planned to handle the increased cargo capacity of the fleet. The terminal will include special cargo handling areas for pharmaceutical and life science products as well as perishables such as seafood. There will be a high level of warehouse automation and the location was chosen to

ICE-CLASS CONTAINERS ORDERED BY MAERSK LINE

Maersk Line recently signed a new building order with COSCO Shipyard Co., Ltd in Zhoushan China for seven 3,600 TEU (Twenty-Foot Equivalent) container vessels. The vessels will have a length of 200 metres (m), width of 35.2m, and a 10m draft. COSCO Shipyard and Maersk Line have agreed to keep the price confidential. The order is the first step in the investment programme announced by Maersk Line. Over the next five years, $15 bn will go into vessel new building, retrofit programme, containers and

optimise ground transport from the cargo terminal to widebody aircraft stands at Helsinki Airport. Finnair cargo operations will continue at the existing Helsinki facility until they are transferred to the new terminal. A decision on the final ownership structure of the new terminal will be made after construction has been completed.

other equipment. Maersk Line has ordered the vessels for Seago Line, its fully-owned container shipping line dedicated to shortsea services in Europe and throughout the Mediterranean region. Seago Line will deploy the vessels in the Baltic and North Sea regions. They will replace several container vessels, half the size or less of the new buildings. The vessels will sail on marine gas oil (MGO). The vessels will be delivered in April - November 2017. “I am very happy to announce this new order and the first in our investment programme. Our strategy is to grow with the market and to do so we need new vessels from 2017,” said Søren Toft, COO, Maersk Line.

Cargo & Logistics I April-May 2015

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TNT buy will boost FedEx

CHINA INTERESTED IN MIHAN

FedEx is following its expansion plans globally. To compete with rivals, DHL and UPS, FedEx is all set to buy TNT Express

The multi-modal international cargo hub and airport at Nagpur (Mihan) project has attracted China which is now looking at future investments. A business delegation from China recently visited the project and had a meeting with the officials of the Maharashtra Area Development Company (MADC), the nodal agency for the project. The delegation praised the MADC team for the work that has been completed and expressed the desire to invest, a MADC release said. The team took a keen interest in the development in Mihan along with the work that had been done as far as logistics, transportation and employment, the release added. Later, the delegation saw the ongoing construction activities and development work. An airport project for Babasaheb Ambedkar International Airport, Nagpur, Mihan is the biggest economical development project currently underway in the country in terms of investments. The project aims to exploit the central location of Nagpur and convert the present airport into a major cargo hub with integrated road and rail connectivity.

SRILANKAN CARGO DELIVERS CHINESE AID

SriLankan Cargo, the cargo arm of SriLankan Airlines, delivered a consignment of 168 packages of Chinese aid, to the Ministry of Public Order, Disaster Management & Christian Affairs. The consignment was delivered to the disaster management team by officials of SriLankan Cargo recently, by waiving off all terminal handling charges. The consignment which was sent from Shanghai, China, weighing 100000 kgs, consisted of diesel generators, boats, water pumps

April-May 2015 I Cargo & Logistics

CHANGI AIRPORT

AIR 

o broaden its International portfolio, FedEx is to buy its Dutch rival TNT Express. The international parcels delivery giant has offered shareholders €8 per share, a 33 per cent premium on TNT’s closing share price which will cost around €€4.4 billion ($4.8 billion). The all-cash deal would greatly expand FedEx’s presence in Europe, where it has sought to compete with DHL Express of Germany and United Parcel Service (UPS), its principal American rival. With the acquisition FedEx would get access to TNT’s extensive road delivery network. Frederick W. Smith, Chairman and CEO, FedEx, said: “We believe that this strategic acquisition will add significant value for FedEx shareowners, team members and customers around the globe. This transaction allows us to quickly broaden our portfolio of international transportation solutions to take advantage of market trends — especially the continuing growth of global e-commerce — and positions FedEx for greater long-term profitable growth.” Earlier, UPS dropped its $6.9 billion bid for TNT in 2013 after the European

Commission, the European Union’s antitrust regulator, blocked the deal, concerned that it would limit choice for European shipping customers and lead to price increases. But FedEx and TNT were confident that their deal would pass antitrust concerns. The deal should help FedEx compete against DHL Express and UPS. In 2013, DHL had a 41 per cent market share in the European international express market, according to data on DHL’s website, which also shows that UPS had a 25 per cent market share. TNT accounted for 12 per cent of the market, and FedEx accounted for 10 per cent. Tex Gunning, CEO, TNT Express, said: “This offer comes at a time of important transformations within TNT Express and we were fully geared to executing our stand-alone strategy. But while we did not solicit an acquisition, we truly believe that FedEx’s proposal, both from a financial and a non-financial view, is good news for all stakeholders. Our people and customers can profit from the true global reach and expanded propositions, while with this offer our shareholders can already reap benefits today that otherwise would

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of the combined companies will remain in the Netherlands, while FedEx has promised to maintain the TNT Express brand for an appropriate period and existing employment terms of TNT Express will also be respected. As part of the transaction, TNT has agreed to sell its airline operations, including its cargo services, because the European Commission restricts foreign ownership of airlines in Europe. However, the terms of the takeover allow for a competitor to make an offer within the next eight weeks and for the current deal to be terminated if that offer exceeds the existing proposal by 8 per cent. Founded in 1946, TNT, based in Hoofddorp, the Netherlands, delivers documents, packages and freight to more than 200 countries and territories, according to its website. It has 65,000 employees and posted revenue of €6.7 billion in 2013. It handles about one million shipments a day. FedEx said that it intended to finance the offer through cash as well as existing and new debt. The agreement includes a €200 million breakup fee. Based in Memphis, FedEx is one of the world’s largest providers of delivery services. The company posted revenue of $45.6 billion in 2014 and has more than 300,000 employees. It handles more than 10.5 million shipments a day.

AIR  amongst other equipment, in light of a national policy to be fully equipped for emergency use during a disaster. “SriLankan Cargo can be proud of its achievement in being the leading handling agent for cargo of all airlines that operate through BIA, with its Cargo Centre located in the airport itself, comprising of an impressive storage space of over 20,000 square meters,” said a release.

ANA TO FORM JV WITH UNITED AIRLINES All Nippon Airways (ANA) and Star Alliance partner United Airlines have secured Japanese antitrust clearance for transpacific cargo Joint Venture (JV). The joint venture, which was first announced

last November, has been approved by the Japanese transport ministry, MLIT. The partners said the partnership will create a more efficient and comprehensive transpacific cargo network. “This antitrust immunity and any additional government approvals, enables ANA and United to jointly manage activities covered by the air cargo joint venture—including network planning, pricing, sales and handling—on specified transpacific routes. This cargo joint venture is the first of its kind between Asia and the Americas, and would generate substantial service benefits for freight customers including an expanded network, greater capacity and expedited transport,” ANA said in a statement. ANA already has joint ventures in place with United Airlines (Transpacific), Lufthansa, Swiss International Air Lines and Austrian Airlines (Japan-Europe).

TNT

only have been available in the longer run.” TNT has gone through a series of largely unsuccessful restructurings. “Revenue has fallen over 7 per cent since 2011 and the company’s profit margins have been no higher than 2.25 per cent, with 2014 seeing a loss. The reason behind this performance has been the miserable state of TNT’s markets. TNT is focused on the ‘business to business’ express sector in Europe which has suffered badly from the depressed economic climate. Its problems are both structural and cyclical, with many national markets either depressed or ferociously competitive. TNT does have intercontinental business which is growing, however it’s a small player in a big and tough market. One of TNT’s issues is its strange positioning. Growth in the ‘business-to-consumer’ segment has been extraordinarily strong, driven by internet retailing. Yet TNT has failed to exploit this market because it simply does not have the systems in-place to provide ‘last-mile’ solutions,” quoted Transport Intelligence. FedEx and TNT Express expect the deal to be completed in the first half of next year and say they are confident that any European competition concerns can be overcome this time. The European regional headquarters

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AIR  GLOBAL CARGO CONFERENCE AT ABU DHABI WCA, the world’s largest and most powerful network of independent freight forwarders, has announced that its annual WCA Global Conference will be held in Abu Dhabi next year. Expected to attract attendance of around 2,500 freight forwarder delegates, the 2016 event will be held at the Abu Dhabi National Exhibition Centre (ADNEC) from March 10 to March 16, 2016. WCA President David Yokeum added: “We are delighted to bring the WCA Conference Week to the Middle East for the first time. This event is now firmly established as the premier networking and business-generating opportunity for independent freight forwarders and provides a platform for tens of millions of dollars of new business. Thanks to the innovation and dedication of the Etihad Cargo management, we have jointly established a number of highly successful programmes that are already proving hugely beneficial to both Etihad Cargo and our global membership of over 5,700 freight forwarder offices around the world.”

BOOST FOR ABC’S FREIGHT TONNAGE AirBridgeCargo (ABC) Airlines boosted

freight tonnage by 20 per cent in the first quarter. The all-cargo carrier, which operates 14 Boeing 747 freighters, transported 103,816 metric tons of freight in the three months through end-March and posted a 28 per cent in traffic measured in freight tonne kilometres. The market-beating increase followed a 17.6 per cent growth in 2014 to a record 401,000 tonnes. “Adding more capacity at the beginning of 2015 allowed us to maintain and even improve our leading positions in

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Delhi and Schiphol sign MoU

elhi Airport and Amsterdam Airport Schiphol have signed a Memorandum of Understanding (MoU) to collaborate on and promote cargo business between them. The MoU’s scope includes business promotion, product development, knowledge sharing, training, performance benchmarking and regulatory agency cooperation. The MoU is intended to enhance Delhi’s and India’s logistic capabilities at a global level. Speaking at the signing ceremony in Delhi, I Prabhakara Rao, CEO, DIAL (owner of Delhi Airport, and a consortium led by the GMR Group) shared his vision for cargo business at Delhi Airport, stating: “DIAL is committed to add value to the air freight community and the supply chain. We aim to make Indian trade much more competitive in the global market. In line with our Honorable Prime Minister’s vision of ‘Make in India’, we are at the cusp of history for the next stage in our economic growth. We have created world class infrastructure at Delhi and are at the right moment to partner with Amsterdam Airport Schiphol to bring our product onto at par with global standards.” Enno Osinga, SVP Cargo, Amsterdam Airport Schiphol said: “Amsterdam can be a Global Gateway for Indian goods destined for mainland Europe, as well as other markets including the USA, Africa and Latin America; Schiphol offers 319 destinations in 95 countries across the Globe. We will build a trade lane between Amsterdam and Delhi, making Delhi a hub and a global gateway. We will work with our friends in Delhi to take air cargo business on this lane to the next levels of business efficiency and operational excellence.” He added that Schiphol sees Delhi Airport as one of the very few global airports which have a robust cargo strategy in place, and it therefore regards Delhi Airport as a natural ally.

CATHAY USES BONDED TRUCKING SERVICES: Cathay Pacific Airways has been the first airline to use the new Import Bonded Trucking service that has been recently started by Delhi International Airport Private Limited (DIAL). The service is meant to transship cargo from Delhi Airport to Jaipur where the airline does not have freighter operations or a direct route. On the first day of movement of shipments to the air cargo complex in Jaipur, Cathay Pacific Cargo used the service to transport shipments of around five metric tonnes. “In order to support airlines through an innovative combination of multimodal transport system, DIAL had conceived the

concept of Road Feeder Services. It serves as a means to create Delhi airport as an attractive business location and aims towards making IGI Airport a successful cargo hub. This service can be used by the airlines to transship shipments to their respective offline ports through bonded trucking,” said a release. Commenting on the new service, Anand Yedery, Regional Cargo Manager – South Asia, Middle East & Africa, Cathay Pacific Cargo said, “This is a welcome initiative which will help us provide end to end solutions to our customers in our offline ports. The beginning of this service certainly assists Cathay Pacific Cargo to serve as the one-stop shop for all cargo solutions. This will definitely help to further strengthen our position in the North India market.”

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AIR  core markets in Europe, the US and Asia by increasing frequencies out of these regions and opening new on-line stations,” said Denis Ilin, Executive President, ABC.

KALE OUTLINES E-FREIGHT ADOPTION Kale Logistics Solutions, a global IT provider to the Logistics, Airports and Transportation segments, presented an inclusive agenda on adoption of the e-Freight industry initiative by focusing on collaborative participation by all stakeholders and more by technology challenged participants. Vineet Malhotra, Kale’s subject matter expert and Senior Vice President, shared in-depth insights on the subject “e-Freight-Heralding a new era in Air Cargo supply chain” address to the gathering at the Bahrain International Airport Development Forum (BIADF). Bahrain International Airport (BIA) is set for a major overhaul during the next five years as it moves to upgrade its facilities and expand through an airport modernisation programme. As per plans, the work will involve a comprehensive redevelopment of the airport to boost passenger and cargo capacity. The cost of the upgrade has been estimated at around $2 billion and once completed, will boost capacity to 13.5 million passengers a year and increase in cargo traffic.

LARRY COYNE HONOURED Larry Coyne, Chief Executive Officer (CEO) and founder of all-cargo carrier Coyne Airways, has been honoured with a Lifetime Achievement Award. Coyne received his award from Jonathan Conway, Divisional Senior Vice-President – UAE Airport Operations, DNATA. “I could not have known when I set up Coyne Airways from a spare room at home that we would grow to be in the top 100 cargo carriers serving thousands of customers around the globe. Not bad for an airline that does not actually own any aircraft,” said Coyne. Coyne Airways operates to some of the worlds most difficult to reach destinations, including the Caspian, Afghanistan, Iraq, and more recently Africa.

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TIACA pushes advance data

re-loading advance cargo information (PLACI) initiatives undertaken by the US, EU, and Canada since the 2010 “Yemen incident” have proved that using Advance Data for civil aviation risk assessment provides an additional layer of security. Regulators must continue to work closely with all members of the air cargo supply chain to ensure impending Advance Data regulations enhance security without impeding cargo flows, according to a new position paper from The International Air Cargo Association (TIACA). “TIACA agrees that the so-called “7+1” data set currently used in the pilot phase is sufficient for civil aviation risk assessment and can be provided early in the supply chain. But regulators must enable all relevant parties including carriers and others, such as Regulated Agents or Postal Operators in the supply chain, to submit data in order to encourage industry to provide it as early as possible,” said

the association. TIACA also calls for a portal or other easily accessible system for small and medium forwarders to use when submitting data, to avoid the complications and IT costs to connect with existing automation systems. The association is also urging regulators to avoid imposing penalties for 7+1 data submission errors. “PLACI regulations must take into account the fact that industry is providing data to the best of its knowledge, at an early stage of the supply chain, in order to promote the shared objective of enhancing security. Because of this, regulators should not look to apply penalties for any errors or updates to PLACI, as data is being provided on a best efforts basis,” said Doug Brittin, Secretary General, TIACA adding that this will ensure that all supply chain models are able to provide the necessary data, and that the data can be analysed and security enhanced, while commercial flows are unimpeded.

CONCOR is cargo custodian at Goa Airport

n a major boost for Goa’s air cargo movement, a custodian for general cargo has been appointed for the first time at Dabolim airport. Airport Authority of India (AAI) recently appointed CONCOR as the custodian for dry cargo with an initial contract of five years. Though, official notification for the same is yet to be issued but sources said that the permission granted to CONCOR as custodian has also been approved from Commissioner of Customs. Sources also said that International pharmaceutical exports from the manufacturing hub at Verna that are currently transported from Mumbai will now be routed through Goa. To commence operations, CONCOR will be seeking space from AAI as it re-

quires storage area for holding export and import cargo. It requires storage area for keeping goods of exporters and importers. It will also have to beef up handling equipment and other infrastructure. CONCOR was bidding for the custodian status for over a year.

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KPT PLANS SEZ Kandla Port Trust (KPT) has planned to develop a Port-based Multi-Product Special Economic Zone (PBMPSEZ) in an area of 5,000 hectares in Kandla and Tuna. Of the 5,000 hectares, 3,600 hectares would be located at Kandla and 1,400 hectares at Tuna port, near Kandla. The project has already received formal approval from Ministry of Commerce & Industry. Kandla Port has floated the Global Expression of Interest for the proposed SEZ project and received more than 25 EOIs from leading players in the domain of Renewable Energy, Desalination Plant and Free Trade Warehousing Zone. The Kandla area proposes to develop a Renewable Energy Park covering an area of 1000 hectares, while the 2600 hectares land would be used by non-polluting manufacturing industries. The Tuna region would focus on ship building /repair facilities along with several ancillary units to support the activity.

Revolutionary decisions for Shipping Sector

H C TIWARI

SHIPPING AND PORTS 

he Minister of Shipping and Road Transport & Highway, Nitin Gadkari, has described the decisions taken by the Cabinet on March 25, 2015 regarding shipping sector as revolutionary and historical. “The initiatives would make a very positive impact on the socio-economic

situation of the country,” he said. The Union Cabinet took three important decisions in the Shipping sector. It gave its approval for enactment of Central legislation for declaring 101 additional Inland Waterways as National Waterways (NW) for navigation. In addition, the Cabinet gave its approval for the formation of a Special Purpose Vehicle (SPV) to provide efficient rail evacuation systems to Major Ports and thereby enhance their handling capacity and efficiency. It also gave its ‘in-principle’ approval for the concept and institutional framework of Sagarmala Project. Gadkari said that transportation through waterways was much more cost effective compared to road and rail transportation. Stating that so far the country had only five waterways declared as national waterways, the Minister said India had large untapped potential in this regard.

MARITIME LEADERS CALL TO ADAPT CHANGES Asia’s maritime leaders have recently called for the industry to adapt more quickly to the changing market conditions in order to effectively capture opportunities and ensure its long-term future across the region. Speaking at a Sea Asia 2015 industry insights briefing ahead of the conference (to be held in Singapore from 21-23 April, 2015), the leaders highlighted the volatile commodity prices as well as fluctuating supply and demand as key drivers behind the changing conditions. Leaders added that the speed at which the industry can adapt to this changing state of play will ultimately define Maritime’s ongoing success. Managing Director of Precious Shipping Ltd, Khalid Hashim, said that “these market forces have created substantial challenges for the dry bulk shipping sector. Asia continues to be the driving

April-May 2015 I Cargo & Logistics

AN EPIC JOURNEY: CSS employess celebrating 20th anniversary of the company

FPS adds two network agents

PS Group has appointed two new network agents. CSS Pakistan is based in Karachi, with branches in Lahore, Sialkot, Faisalabad, Islamabad and Multan; it was launched in 2013, and is part of the CSS Group of Dubai, which now has six members in the FPS network. The company provides multi-modal forwarding and logistics services, including a transit service for

goods destined for Afghanistan. Also joining the FPS Group network is Servotech Shipping & Logistics, with branches in Karachi, Lahore, Faisalabad and Sialkot. Launched in 2000, the multi-modal capabilities of the company include sea-air. At the same time, existing FPS network agent G-Freight of Portugal has been promoted to full Group Member status, enabling it to take a more ac-

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Car exports soars at KPL

CHALLENGES AHEAD: Cars parked on Chennai Port ready to be exported

amarajar Port Limited (KPL) at Ennore handled 2.15 lakh cars of five carmakers. It is the first time that the port has exported more cars than Chennai Port Trust (ChPT). ChPT managed to handle 22,000 less cars than KPL while working with just three carmakers. This is the first time in recent years that the car handling volume of ChPT has fallen below the 2-lakh mark. Located barely 25 kilometers (km) from each other, both ports have in recent years competed for business in a region known for its auto manufacturing and exports. tive role in the direction of the Group. G-Freight joined FPS in 2006, and was the host of the highly-successful 2014 FPS Group AGM and conference held in its home city of Porto. 20TH ANNIVERSARY FOR CSS: Consolidated Shipping Group (CSS), the network agent for the FPS Group of independent forwarders and consolidators in seven countries, has celebrated its 20th anniversary. CSS was founded in 1995, with a small operation catering for local logistics requirements in Dubai. It has since grown to become one of the largest privately-owned freight forwarding and logistics businesses throughout the Middle East and Indian subcontinent, with 800 staff and bases in Dubai, Abu Dhabi, Bahrain, Saudi Arabia, Kuwait, India and Pakistan . The company now provides a broad portfolio of services including NVOCC, Freight forwarding, 3PL & 4PL, projects, heavy equipment logistics and re-locations.

The Chennai Port has been handling cars since 2009-10, whereas KPL has been at it since 2010-11. In March, 2015, Toyota Kirloskar Motor Pvt. Ltd. (TKM) announced the signing of a MoU with Kamarajar Port Ltd. (KPL) in order to help facilitate the expansion of its export business. TKM entered into a 10-year agreement with the port, renewable every five years. The agreement was signed by the company officials in the presence of Union Shipping Minister Nitin Gadkari and Minister of State for Shipping Pon. Radhakrishnan.

BOOST FOR JNPT WITH MOORING DOLPHINS

he construction of Mooring Dolphins to the existing BPCL Liquid Cargo Jetty at Jawaharlal Nehru Port has been completed on March 30, 2015. The project cost `11 crores which was shared by JNPT and BPCL equally, according to a Jawaharlal Nehru Port Trust (JNPT) release. This initiative was taken to meet the needs of the trade. With this project one million tonne throughput has been added to the handling capacity. This facility can accommodate bigger vessels or two feeder vessels at LB01, release added.

SHIPPING AND PORTS  force behind global growth but slower-than-expected economic development in some markets has had a significant impact. The recent slow-down in China’s real-estate industry, for example, has reduced demand for iron ore at a time when there’s more dry bulk ships in the global fleet”. Hashim added the industry is taking action to manage these challenges. “Companies are focusing on driving efficiencies and managing costs to weather these challenging conditions. One of the ways they’re doing this is by scrapping or selling older assets — a move which also allows them to generate more cash. Companies are also raising equity by going back to their shareholders or the market to ensure they have sufficient liquidity to support them over this time,” said Hashim.

SCI TAKES DELIVERY OF VLCC The Shipping Corporation of India Ltd. (SCI) accepted delivery of a Very Large Crude Oil Carrier (VLCC) on March 28, 2015. The vessel has been named as M.T. Desh Vibhor. The vessel — with a gross tonnage of 165,319 tonnes and deadweight of 316,634 tonnes at scantling draft — was ordered with Jiangsu Rongsheng Heavy Industries Co. Ltd., China during November 2010. The vessel has been classed with IRS and LRS and has been built to comply with latest international regulations. With India dependent on the import of crude oil, tankers under the Indian flag provide vital energy security to the country. In times of international crisis, it is all the more important to maintain a secured supply line to bring energy into the country. Therefore, enhancing the tanker fleet will ensure uninterrupted transport of essential cargoes such as crude oil and petroleum products, thereby ensuring energy security. Energy transportation has been the core business segment for SCI and the induction of this vessel will strengthen its position in this sector, the release pointed out.

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FREIGHT LOADING UP FOR INDIAN RAILWAY

DHL to execute its Strategy 2020

HEMANT RAWAT

Indian Railways carried 1097.57 million tonnes of revenue-earning freight traffic during the financial year 2014-15 i.e. from April 1, 2014 to March 31, 2015. The freight carried shows an increase of 44.02 million tonnes over the freight traffic of 1053.55 million tonnes actually carried during the corresponding period last year, registering an increase of 4.18 per cent, according to a release. During the month of March 2015, the revenue-earning freight traffic carried by Indian Railways was 101.57 million tonnes. There is an increase of 1.08 million tonnes over the actual freight traffic of 100.49 million tonnes carried by the Indian Railways during the same month last year, showing an increase of 1.07 per cent.

FFFAI TO HOST CONVENTION Federation of Freight Forwarders’ Associations In India (FFFAI) is hosting its 22nd Biennial Convention in Mumbai from May 21-23, 2015. Custom Brokers and Freight Forwarders from all across India who are owners of their respective organisations are expected to participate in convention as delegates. The convention will address the major challenges faced by the fraternity. Presentations will be made by experts in the field of freight forwarding, shipping, ports/CFS/ICD, Academics. Break-out meetings such as B2B Networking meetings and a Mini-Trade Fair will also be organised on the sidelines of this convention. Exhibitors will get an excellent opportunity to showcase their capabilities and facilities in the fair. Union and State Ministers, senior bureaucrats from the Ministry, Government Departments, and leaders from the EXIM fraternity will attend the event.

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ail and logistics major Deutsche Post DHL Group, is on the path to execute the group’s Strategy 2020 across the region. The group announced its Financial Year (FY) 2014 results. Globally, compared to FY2013, revenues rose by 3.1 per cent to EUR 56.6 billion with all four of the company’s operating divisions contributing to this improvement. During a visit to Taiwan, Frank Appel, CEO of Deutsche Post DHL Group, explained the Group’s “Strategy 2020: Focus. Connect. Grow.” — which outlines the Group’s strategic priorities for the coming years and underscores its goal to become the company that defines the logistics industry. “This year we begin executing Strategy 2020 in each of our divisions. The leading growth drivers in our business are — and will remain — the booming e-commerce business and the dynamic growth of emerging markets. At present, emerging market revenues contribute just over 20 percent of the Group’s revenues; by 2020, we expect this figure to climb to 30 percent. This means a substantial increase in absolute revenue growth in the emerging market countries,” Appel said.

Partnership extended for Teach For All: Deutsche Post DHL Group (DPDHL) recently extended its partnership with global not-for-profit organisation “Teach

Frank Appel For All” in Asia Pacific, to Bangladesh and Malaysia, helping to boost educational opportunities and employability within the two countries. The move brings the total number of country partnerships between DPDHL and “Teach For All” partners to ten, with a total of four in Asia Pacific. Under these new partnerships, DPDHL will employ its competence in logistics and business to support Teach For Bangladesh and Teach For Malaysia’s goals to promote educational opportunities and employability. Along with providing financial support, this partnership will also see DHL employees in Bangladesh and Malaysia volunteering to support teachers, who will in turn impact students in the countries.

JBS releases book on Customs clearance

andbook for Customs Clearance, a 150-page book modeled as a ready reckoner for usage by personnel of Customs Broker and EXIM companies has been published by JBS Academy. The book authored by Samir J Shah, Chief Mentor and Director, contains 16 pages of one-liner objective learning on various aspects of Customs Clearance; 40 pages of short notes besides Customs definitions; List of Export Promotions Councils/Commodity Boards; List of abbreviations used in Customs Clearance; INCOTERMS 2010, etc. The book is a comprehensive guide for those working at the field level. It targets basic concepts and it is hoped that the reader would better his domain knowledge. Written in simple English with minimal technical jargon, it is easy to use. The author is an eminent expert on Customs matters with a working experience of over 30 years. Like his earlier publication, he has dedicated the book to all those working in the Customs department.

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Amazon India ups its investments

AMAZON

ccording to research by RNCOS in October last year, Indian online retail market is estimated to grow over four-fold to touch $ 14.5 billion (over `88,000 crore) by 2018 on account of rapid expansion of e-commerce in the country. The online retail market is projected to grow at a compound annual rate of 4045 per cent during 2014-18. Amazon India, a subsidiary of USbased Amazon, is playing a big role to fulfill the needs of Indian online customers. Since its launch in June 2013, Amazon’s marketplace has grown to be one of the largest store in India with over 21 million products from a continually growing base of thousands of small and medium-sized businesses. The company is expanding throughout the country. In a recent move Amazon Seller Services Pvt Ltd (ASSPL) announced fresh investments in the state of Telangana with the opening of a Fulfilment Centre (FC), spread over 280,000 square feet near Kottur, on the outskirts of Hyderabad. The FC will be operational from May 2015. This is the largest investment in infrastructure in any single state, to date, by Amazon in India. The FC will allow Amazon.in to offer its Fulfilment by Amazon (FBA) service to thousands of small and medium businesses in the state and empower them to gain access to and service customers across the country at significantly low operating costs. It will also enable faster and quicker delivery of products to amazon.in customers in the region. With the opening of the new FC in Telangana, Amazon will have 11 FC’s operational across nine states in India covering a total of over one million square feet space with a storage capacity of over 2.5 million cubic feet. Welcoming the investments in the state, the Chief Minister, K Chandrashekar Rao said, “We are very excited that Amazon has decided to invest their biggest Warehouse in Telangana. We have passed the TS iPass bill in our Assembly that ensures self-certification and deemed approval of all clearanc-

INFRA BOOST: One of Amazon’s fulfilment centres where packages arrive and are scanned into the inventory management system to keep a virtual record and later on shipped as per the orders

es within 3 weeks of application for any Mega Project. For Amazon, we have given all clearances in 11 days, well within the guaranteed time. We are making all efforts to make Telangana an investor friendly state.” ASSPL also signed a Memorandum of Understanding (MOU) with the Telangana State Government to train thousands of sellers across the state in ecommerce and take advantage of the digital economy. Under the MOU, Amazon India will offer trainings to SMEs through seminars, workshops, video aids and ready reckoners on how to list & manage inventory for an ecommerce business. Speaking on the occasion Dave Clark, Senior Vice President Worldwide Operations and Customer Service at Amazon said, “Telangana has been home to our IT operations in India. It is the ease of doing business in the state, thanks to the progressive state government, that has encouraged us to make further significant investments in the state. The World-class fulfillment infrastructure and customer service will allow Amazon to do the heavy lifting for the thousands of small & medium sellers from the state and help them grow profitably.” The IT Minister, K T Rama Rao said “Hyderabad, being centrally located has

a geographical advantage, making it an ideal logistics hub. The fact that Amazon is setting up their largest warehouse here is a testimony. We believe that the Fulfilment by Amazon (FBA) service plays a very critical role in the growth of the SMEs in the state. It amplifies their reach at very low operating costs and gives them a level playing field with the big sellers. We hope to see a boost in local employment and entrepreneurship as the demand for ancillary industries such as packaging, transportation, logistics, and hospitality will grow. We also want more and more sellers across the state to adopt the tools of the new age economy and the trainings that Amazon will provide will be good start to that.” Amit Agarwal, VP and Country Manager, Amazon India added “We are committed to and look forward to partnering the state government in transforming the lives of small and medium businesses across the state by giving them access to tools and technology that will empower their growth in the digital economy. Likewise the citizens of Telangana can look forward to getting a quick, easy and convenient access to products from India’s largest selection of over 2.1 crore products on Amazon.

Cargo & Logistics I April-May 2015

NEWS IN BRIEF

GIL bags rail project G

MR Infrastructure Ltd has announced that a consortium led by GMR Infrastructure Limited (GIL) has been issued Letter of Award for construction of 417 km long Eastern Dedicated Freight Corridor railway project at a cost of `5,080 crore on EPC (Engineering, Procurement and Construction) basis. GMR Group is not required to provide significant investment for the project since it is implemented on EPC basis. Earlier in November 2014, the GMR led consortium emerged lowest amongst five other bidders for the project through an international competitive bidding process. The project funded by World Bank is divided into two packages. One is from Mughalsarai to Karchana (near Allahabad) for 180 km and from Karchana to Bhaupur (near Kanpur) for 237 km in the state of Uttar Pradesh. The project involves design and construction of civil structures and track works for double line railway.

Chhattisgarh to upgrade roads

he Chhattisgarh Government is all set to invest `9,500 crore towards upgradation of 44 roads in the state. Raman Singh, Chief Minister of the state, recently chaired a meeting giving the final shape to the proposal. “The meeting discussed the appointment of a technical advisor for the project and the bidding process,” a state government official said. According to the

official, the advisor would be appointed by the end of May, while the tendering and other processes required for the project would begin in July. “The project is expected to be completed in 21 months,” the official said. About 1,900 km of roads —19 state roads and 25 district roads—would be taken up for upgradation under the project.

AWARDS

DHL Express DHL Express has been recognised by leading human capital organisations, including Aon Hewitt, Top Employers Institute and Great Place to Work Institute, as an exemplary employer and an excellent workplace in multiple markets throughout Asia Pacific since December 2014. The total 15 awards include Asia Pacific-wide recognition, such as the “Aon Hewitt Best Employer Asia Pacific” 2015.

Kale Logistics Kale Logistics Solutions announced that its Co-founder and Chairman, Vipul Jain, had been conferred the prestigious Asia Pacific Entrepreneurship Award (APEA) in the outstanding category for the India Chapter.

APPOINTMENTS

CATHAY PACIFIC AIRWAYS

athay Pacific Airways recently appointed Tarun Sethi as Cargo Manager – Karnataka. Sethi will oversee the business and operations of Cathay Pacific Cargo in the region. Sethi joined Cathay Pacific as Cargo Manager – Bengaluru in 2008, before moving to Mumbai in 2009 to oversee Cargo Sales and Operations for Western India. With the launch of twice weekly freighters to Bengaluru in August 2011, he moved back to Bengaluru as Cargo Manager — Karnataka and Andhra Pradesh and was instrumental in setting up Cathay Pacific Cargo in Hyderabad for Sales and Services. The carrier also appointed J Sajeev Kumar as Cargo Manager — Tamil Nadu and Kerala. Kumar will oversee cargo sales and revenue for Cathay Pacific and will be responsible for the development and execution of cargo sales strategy for the region. Kumar has been in the aviation industry since 1993 and has worked

April-May 2015 I Cargo & Logistics

with Srilankan Airlines GSA in Kerala in various capacities. In 2003 joined Cathay Pacific GSA overseeing Kerala region’s business development and later on moved to Hyderabad as Regional Manger — Andhra Pradesh for Cathay Pacific Passenger and Cargo.

CEVA

EVA Logistics announced the appointment of Antonio Fondevilla as Executive Vice President responsible for the company’s global automotive sector. Fondevilla has more than 20 years of supply chain management and automotive logistics experience. He joined CEVA in 2008 and most recently served as Vice President, Global Key Account Management, as well as the company’s interim leader of the European Automotive sector.

DHL GLOBAL FORWARDING

HL Global Forwarding has appointed Stephen Ly as its Managing Director for Singapore. Formerly Managing Director for DHL Global Forwarding Philippines, Ly is returning to Singapore after nearly four years during which he was the Head of Customs Brokerage Services, Asia Pacific and Africa for over three and a half years. DHL Global Forwarding also appointed David Cels as Country Manager, Papua New Guinea. Cels is returning to DHL after a year as a Logistics Consultant in the Industrial Projects sector. In his new role, Cels will be based in Port Moresby, Papua New Guinea, and will report directly to Tony Boll, CEO, DHL Global Forwarding South Pacific.

NEWS IN BRIEF

Get set for India Warehousing Show

he Fifth India Warehousing Show is all set to open doors from July 1-3, 2015. Visitors to the three-day exhibition will be treated to demonstrations of advanced warehousing equipment and solutions as well as a well conceived conference programme with the theme, “Creating Competitive Warehousing Market in India”. Naveen Seth, Managing Director, Reed Manch Exhibition, said: “Since the last edition of the exhibition in Delhi, the Indian sub-continent market has continued to show good internal growth and the region is still benefiting greatly from e-commerce, foreign investment and local manufacturing. The region is an important area for the supply chain industry and we are pleased to be back with new ideas and innovative programmes. The conference programme is a superb opportunity for supply chain professionals to network with their peers and identify potential collaborations.” The forecast for the Indian supply chain industry in particular is very positive; and with the emerging trends of 3PL and 4PL driven by the international players, has further enhanced the growth of the industry. The demand for this dynamic market has surpassed the previous fig-

ures and one way to meet such demand is through exhibitions. This is where the IWS acts as a trade interface and has thus, witnessed numerous product launches. The exhibition profile will cover a comprehensive range of products and services for warehousing, material handling, storage, automation, packaging, logistics and supply chain. The co-located event, India Material Handling and Logistics Show (IMHLS) is a dedicated event on material handling products and services. Among the partners for the show are Indospace, Gandhi Automations, Indo Arya, Godrej & Boyce, Thinklink, Nilkamal, Hi-Tech Robotics, Grey Orange,

NIDO, Daifuku, Kirby, SSI Schaefer, Zamil, Kirby, Everest, Armstrong, Cordstrap and many more. To further reinforce its objective of being an interface between seller and buyer, the show enjoys the endorsements from AIDC Technology Association of India, Warehousing Development and Regulatory Authority (WDRA), the Air Cargo Agents Association of India (ACAAI), Infrastructure Industry and Logistics Federation of India (ILFI) and Indian Private Ports & Terminals Association (IPPTA). Information on India Warehousing Show can be found at www. indiawarehousingshow.com

Global show on services

ACCD holds training session

he government’s effort in attempting a revolution of sorts with the “Make in India” slogan is being carried forward in many ways. A case in point is the ‘Global Exhibition on Services (GES)” held recently at Delhi’s Pragati Maidan. The main objective of the exhibition was to enhance trade in services between India and the rest of the world. The focus sectors were Information Technology and Telecom, Education, Healthcare, Logistics, Media & Entertainment, Professional Services, Tourism, Space and Research & Development. The GES provided a platform to explore serious business opportunities. The inaugural ceremony was a high security event with the attendance of the Prime Minister Narendra Modi and other dignitaries from the Union Government. C & L’s focus was on the Logistics portion, which was a very small affair in less than 500 sq. mtrs. area, wherein approximately a dozen participants had booths. If multinational agencies and foreigners were expected to visit the booths and get an idea of the logistics offering on show, they would have been disappointed.

April-May 2015 I Cargo & Logistics

he Air Cargo Club of Delhi (ACCD) started the new financial year with a useful training programme on April 29. Kavita Iyer from Ahaana Solutions flew in from Mumbai with her enlightening presentation. Iyer shared her views on how important it was to sustain human resources development with specialised training, dwelling on KASH (Knowledge, Attitude, Skills, Habits) and GROW (Goal, Reality, Options, Way forward). The primary message she was conveying was that it was better to be pro-active and not reactive, in matters of training and upgrading skills of the staff. At the luncheon meeting, ACCD also opened the way to receive donations in cash and kind for the unfortunate victims of the tragic earthquake in Nepal. `1.18 lakh was collected, which is being routed through Roatary International.

STATS

TRAFFIC MAJOR PORTS PORTS TRAFFICHANDLED HANDLED AT AT MAJOR (DURING APRIL TO FEBRUARY, 2015* VIS-A-VIS APRIL TO FEBRUARY, 2014)

(*) TENTATIVE

(IN ' 000 TONNES)

PORTS

APRIL TO FEBRUARY

% VARIATION

TRAFFIC

AGAINST PREV.

2015* 2

1 KOLKATA Kolkata Dock System

2014 3

YEAR TRAFFIC 4

13180

11175

17.94

Haldia Dock Complex

27328

25569

TOTAL: KOLKATA

40508

36744

6.88 10.24

PARADIP

64524

61836

4.35

VISAKHAPATNAM

52937

52768

0.32

KAMARAJAR (ENNORE)

27549

24689

11.58

CHENNAI

48157

46389

3.81

V.O. CHIDAMBARANAR

28979

25789

12.37

COCHIN

19659

19161

2.60

NEW MANGALORE

32802

35761

-8.27

MORMUGAO

13001

10607

22.57

MUMBAI

56341

53906

4.52

JNPT

58230

56476

3.11

KANDLA

84649

79818

6.05

527336

503944

4.64

TOTAL:

Source:INDIAN PORTS ASSOCIATION

Turkish Cargo Awards Night at Delhi



  TOP HONOURS: (Clockwise from left) All the winners and guests awarded by Turkish Cargo; Mehmet Ali Yilmaz, Regional Cargo Manager, Turkish Cargo (left) presenting the lucky draw ticket to Pankaj Aggarwal; Dr Burak Akçapar, Ambassador of Turkey (left) presenting the award for the best performance in total sales to Karishma Kapil and Bharat Behl of Dachser India and Ali Turk, Senior Vice President, Turkish Cargo (centre) presenting the award for the highest sales of TK plus to Prem  Sawhney and Sanjay Grover of Expo Freight

Cargo & Logistics I April-May 2015

STATS

INDIAN PORTS ASSOCIATION

TRAFFIC HANDLED AT MAJOR PORTS TRAFFIC HANDLED AT MAJOR PORTS

(DURING APRIL VIS-A-VIS APRIL TO FEBRUARY’2014) (DURING APRILTO TO FEBRUARY’2015* FEBRUARY'2015* VIS-A-VIS APRIL TO FEBRUARY'2014) (*)

TENTATIVE

PORT

(IN '000 TONNES) TRAFFIC PERIOD

P.O.L.

IRON ORE

FERTILIZER FIN. RAW

COAL CONTAINER THERMAL COKING TONNAGE TEUs

OTHER CARGO

TOTAL

% VAR. AGAINST 2013-14

KOLKATA Kolkata Dock System

Haldia Dock Complex TOTAL: KOLKATA

PARADIP

VISAKHAPATNAM

TRF APRIL-FEB.'2015

556

124

7424

483

4855

13180

TRF APRIL-FEB.'2014

611

131

238

6459

413

3732

11175

TRF APRIL-FEB.'2015

4701

2274

287

455

1067

5272

1592

11680

27328

TRF APRIL-FEB.'2014

5350

1930

194

321

1475

4809

2000

104

9490

25569

TRF APRIL-FEB.'2015

5257

2398

364

553

1067

5318

9016

578

16535

40508

TRF APRIL-FEB.'2014

5961

2061

198

321

1475

5047

8459

517

13222

36744

TRF APRIL-FEB.'2015

16246

1920

4027

27412

7078

7729

64524

TRF APRIL-FEB.'2014

16386

5107

122

3590

22758

6324

7467

61836

TRF APRIL-FEB.'2015

13446

7560

1611

685

2421

5397

3962

225

17855

52937

TRF APRIL-FEB.'2014

12690 11459

1733

725

2597

6195

4529

242

12840

52768

KAMARAJAR(ENNORE) TRF APRIL-FEB.'2015

2884

21918

330

2417

27549

TRF APRIL-FEB.'2014

2066

19981

355

2287

24689

TRF APRIL-FEB.'2015

11710

146

197

344

27348

1417

8412

48157

TRF APRIL-FEB.'2014

11588

160

244

25842

1339

8484

46389

V.O.CHIDAMBARANAR TRF APRIL-FEB.'2015

549

438

1000

7646

9895

502

9405

28979

TRF APRIL-FEB.'2014

415

388

680

6086

9111

457

9109

25789

TRF APRIL-FEB.'2015

12662

352

4835

337

1644

19659

TRF APRIL-FEB.'2014

13248

225

4333

316

1319

19161

TRF APRIL-FEB.'2015

20447

1424

552

2415

5058

799

2052

32802

TRF APRIL-FEB.'2014

22501

3036

405

2542

4765

656

1806

35761

TRF APRIL-FEB.'2015

517

630

216

1697

5801

289

3851

13001

TRF APRIL-FEB.'2014

488

179

6746

176

3018

10607

TRF APRIL-FEB.'2015

33067

142

276

4179

493

18184

56341

TRF APRIL-FEB.'2014

32647

151

133

3854

412

16709

53906

TRF APRIL-FEB.'2015

3725

51999

4077

2506

58230

TRF APRIL-FEB.'2014

3986

50017

3762

2473

56476

TRF APRIL-FEB.'2015

50450

1076

3578

614

8889

183

19859

84649

TRF APRIL-FEB.'2014

48294

586

2562

863

5818

221

452

21022

79818

TRF APRIL-FEB.'2015 170960 15200

7217

7906

77742

29165

108697

7252

110449 527336

TRF APRIL-FEB.'2014 170270 22320

5934

6831

65111

29653

104069

6768

99756 503944

21.62

15.74

19.40

-1.65

4.45

7.15

10.72

CHENNAI

COCHIN

NEW MANGALORE

MORMUGAO

MUMBAI

J.N.P.T.

KANDLA

ALL PORTS

% Variation from previous year

0.41 -31.90

17.94

6.88

10.24

4.35

0.32

11.58

3.81

12.37

2.60

-8.27

22.57

4.52

3.11

6.05

4.64

Source:INDIAN PORTS ASSOCIATION

April-May 2015 I Cargo & Logistics

STATS

INTERNATIONAL FREIGHT INTERNATIONAL FREIGHT AIRPORT

SL. NO.

ANNEXURE-IVA

FREIGHT (IN TONNES) For the period April - February % % 2014-15 2013-14 Change Change

For the month FEBRUARY FEBRUARY 2015 2014

(A) 18 INTERNATIONAL AIRPORTS 1

CHENNAI

17161

16377

4.8

201952

199968

1.0

KOLKATA

3613

3688

-2.0

44018

41345

6.5

AHMEDABAD

1247

1122

11.1

15885

14404

10.3 -37.2

GOA

113

-22.1

1085

1727

TRIVANDRUM

2759

1953

41.3

26465

25137

5.3

CALICUT

1951

1726

13.0

20144

20518

-1.8

LUCKNOW

136

83.8

1288

1067

20.7

GUWAHATI

-100.0

-61.8

SRINAGAR

JAIPUR

161.5

625

219

185.4

BHUBANESWAR

289.6

MANGALORE

-100.0

261

COIMBATORE

22.9

828

873

-5.2

AMRITSAR

366.7

472

1332

-64.6

TRICHY

410

394

4.1

4339

4279

1.4

VARANASI

PORTBLAIR

IMPHAL

0 27576

0 25567

0 310970

7.9

0 317376

2.1

TOTAL (B) 6 JV INTERNATIONAL AIRPORTS 19

DELHI (DIAL)

32956

29753

10.8

388525

352676

10.2

MUMBAI (MIAL)

38619

37110

4.1

440774

423395

4.1

BANGALORE (BIAL)

13379

11867

12.7

151161

136378

10.8

HYDERABAD (GHIAL)

4218

3623

16.4

49615

44576

11.3

COCHIN(CIAL)

3697

3716

-0.5

55351

38133

45.2

NAGPUR (MIPL)

-22.0

379

384

-1.3

92901

86110

7.9

1085805

995542

9.1

TOTAL (C) 7 CUSTOM AIRPORTS 25

PUNE

-100.0

VISAKHAPATNAM

PATNA

CHANDIGARH BAGDOGRA

MADURAI

0 0

3 1

0 1

0.0

GAYA

29 30

TOTAL

(D) 15 DOMESTIC AIRPORTS

(E) OTHER AIRPORTS GRAND TOTAL (A+B+C+D+E)

120477

111677

7.9

1403271

1306523

7.4

Source: AIRPORTS AUTHORITY OF INDIA

Cargo & Logistics I April-May 2015

STATS

DOMESTIC FREIGHT DOMESTIC FREIGHT SL. NO.

AIRPORT

For the month FEBRUARY FEBRUARY 2015 2014

(A) 18 INTERNATIONAL AIRPORTS 1 CHENNAI 2 KOLKATA 3 AHMEDABAD 4 GOA 5 TRIVANDRUM 6 CALICUT 7 LUCKNOW 8 GUWAHATI 9 SRINAGAR 10 JAIPUR 11 BHUBANESWAR 12 MANGALORE 13 COIMBATORE 14 AMRITSAR 15 TRICHY 16 VARANASI 17 PORTBLAIR 18 IMPHAL TOTAL (B) 6 JV INTERNATIONAL AIRPORTS 19 DELHI (DIAL) 20 MUMBAI (MIAL) 21 BANGALORE (BIAL) 22 HYDERABAD (GHIAL) 23 COCHIN(CIAL) 24 NAGPUR (MIPL) TOTAL (C) 7 CUSTOM AIRPORTS 25 PUNE 26 VISAKHAPATNAM 27 PATNA 28 CHANDIGARH 29 BAGDOGRA 30 MADURAI 31 GAYA TOTAL (D) 15 DOMESTIC AIRPORTS 32 INDORE 33 JAMMU 34 RAIPUR 35 AGARTALA 36 VADODARA 37 RANCHI 38 AURANGABAD 39 UDAIPUR 40 BHOPAL 41 LEH 42 DEHRADUN 43 RAJKOT 44 JODHPUR 45 TIRUPATHI 46 DIBRUGARH (D) 15 DOMESTIC AIRPORTS (E) OTHER AIRPORTS GRAND TOTAL (A+B+C+D+E)

ANNEXURE-IVB

FREIGHT (IN TONNES) For the period April - February % % 2014-15 2013-14 Change Change

6702 6586 3157 305 58 24 334 970 261 356 539 20 545 7 0 53 261 350 20528

5669 6627 2850 245 117 15 249 780 265 301 389 14 532 11 0 24 239 314 18641

18.2 -0.6 10.8 24.5 -50.4 60.0 34.1 24.4 -1.5 18.3 38.6 42.9 2.4 -36.4 120.8 9.2 11.5 10.1

74067 81919 38215 3004 1102 316 3180 9290 5462 2103 4999 322 6884 304 0 605 2770 4135 238677

65041 76712 32847 2450 1694 150 2816 6807 3430 6337 3563 257 5615 117 0 375 2461 3728 214400

13.9 6.8 16.3 22.6 -34.9 110.7 12.9 36.5 59.2 -66.8 40.3 25.3 22.6 159.8 61.3 12.6 10.9 11.3

22213 15535 8554 3586 781 450 51119

17765 13498 7147 3033 794 349 42586

25.0 15.1 19.7 18.2 -1.6 28.9 20.0

249198 190762 103676 40067 10143 5172 599018

195501 164971 83677 33994 8742 4691 491576

27.5 15.6 23.9 17.9 16.0 10.3 21.9

2192 89 407 309 0 67 0 3064

1798 199 494 263 27 82 0 2863

21.9 -55.3 -17.6 17.5 -100.0 -18.3 7.0

25209 2732 4775 2983 2232 993 0 38924

471 154 231 339 186 305 93 11 77 106 4 12 1 0 47 2037 110 76858

484 125 295 526 166 207 72 0 74 68 0 8 2 0 19 2046 127 66263

-2.7 23.2 -21.7 -35.6 12.0 47.3 29.2 4.1 55.9 50.0 -50.0 147.4 -0.4 -13.4 16.0

5825 1529 3622 5273 1882 3106 1151 33 850 1205 36 121 11 6 301 24951 1400 902970

19191 1590 4361 3039 1740 1108 031029 4293 1537 3042 5935 1895 2246 768 0 789 973 0 146 18 0 253 21895 1459 760359

31.4 71.8 9.5 -1.8 28.3 -10.4 25.4 35.7 -0.5 19.1 -11.2 -0.7 38.3 49.9 7.7 23.8 -17.1 -38.9 19.0 14.0 -4.0 18.8

Source: AIRPORTS AUTHORITY OF INDIA

April-May 2015 I Cargo & Logistics

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Corporate Office: 187-A, 2nd Floor, Sai Sadan, Sant Nagar, East of Kailash, Delhi-110065 Phone No.: 011-26214454, 26431222, 26211730 Email: brijesh@speedmanlogistics.com, pradeep@speedmanlogistics.com speedex_services@hotmail.com Website: www.speedmanlogistics.com Warehouse: 419-420, Lane No 1, Western Green, Rangpuri, Delhi-110037 Phone No.: 011-40502052

About Us SPEEDMAN LOGISTICS’ foray into logistics industry is not just for creating another logistics company. It is a lifetime commitment to excellence and trust that our customers can bank upon. Our infrastructural strength supports in feeding arround two thousand destinations in India. We are soundly backed by our customer support and professional staff members with full fleet of various vehicles.

Our Mission • To establish lifelong associations, retain clients and increase the number of customers trading every week. • Improve the percentage of deliveries made on time. • Decrease the number of outstanding invoice queries at the end of each week. • Increase the frequency of contacts with existing and prospective customers. • High-integrity workplace atmosphere. • Empowerment of employees.

Our Services Air Freight I Train Freight I Road Freight I Warehousing I Door to Door Logistics I Packaging Service I Supply Chain Management

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STATS

INTERNATIONAL &(INT'L+DOM.) DOMESTIC FREIGHT FREIGHT SL. NO.

AIRPORT

For the month FEBRUARY FEBRUARY 2015 2014

(A) 18 INTERNATIONAL AIRPORTS 1 CHENNAI 2 KOLKATA 3 AHMEDABAD 4 GOA 5 TRIVANDRUM 6 CALICUT 7 LUCKNOW 8 GUWAHATI 9 SRINAGAR* 10 JAIPUR 11 BHUBANESWAR 12 MANGALORE 13 COIMBATORE 14 AMRITSAR 15 TRICHY 16 VARANASI 17 PORTBLAIR 18 IMPHAL TOTAL (B) 6 JV INTERNATIONAL AIRPORTS 19 DELHI (DIAL) 20 MUMBAI (MIAL) 21 BANGALORE (BIAL) 22 HYDERABAD (GHIAL) 23 COCHIN(CIAL) 24 NAGPUR (MIPL) TOTAL (C) 7 CUSTOM AIRPORTS 25 PUNE 26 VISAKHAPATNAM 27 PATNA 28 CHANDIGARH 29 BAGDOGRA 30 MADURAI 31 GAYA TOTAL (D) 15 DOMESTIC AIRPORTS 32 INDORE 33 JAMMU 34 RAIPUR 35 AGARTALA 36 VADODARA 37 RANCHI 38 AURANGABAD 39 UDAIPUR 40 BHOPAL 41 LEH 42 DEHRADUN 43 RAJKOT 44 JODHPUR 45 TIRUPATHI 46 DIBRUGARH (D) 15 DOMESTIC AIRPORTS (E) OTHER AIRPORTS GRAND TOTAL (A+B+C+D+E)

NOTE:

ANNEXURE-IVC

FREIGHT (IN TONNES) For the period April - February % % 2014-15 2013-14 Change Change

23863 10199 4404 393 2817 1975 470 970 261 424 539 20 631 63 410 54 261 350 48104

22046 10315 3972 358 2070 1741 323 782 265 327 389 24 602 23 394 24 239 314 44208

8.2 -1.1 10.9 9.8 36.1 13.4 45.5 24.0 -1.5 29.7 38.6 -16.7 4.8 173.9 4.1 125.0 9.2 11.5 8.8

276019 125937 54100 4089 27567 20460 4468 9303 5462 2728 4999 583 7712 776 4339 606 2770 4135 556053

265009 118057 47251 4177 26831 20668 3883 6841 3430 6556 3563 324 6488 1449 4279 375 2461 3728 525370

4.2 6.7 14.5 -2.1 2.7 -1.0 15.1 36.0 59.2 -58.4 40.3 79.9 18.9 -46.4 1.4 61.6 12.6 10.9 5.8

55169 54154 21933 7804 4478 482 144020

47518 50608 19014 6656 4510 390 128696

16.1 7.0 15.4 17.2 -0.7 23.6 11.9

637723 631536 254837 89682 65494 5551 1684823

548177 588366 220055 78570 46875 5075 1487118

16.3 7.3 15.8 14.1 39.7 9.4 13.3

2192 89 407 309 0 67 0 3064

1798 199 494 263 27 82 0 2863

21.9 -55.3 -17.6 17.5 -100.0 -18.3 7.0

25209 2732 4775 2983 2235 994 0 38928

19201 1590 4361 3039 1740 1109 0 31040

31.3 71.8 9.5 -1.8 28.4 -10.4 25.4

471 154 231 339 186 305 93 11 77 106 4 12 1 0 47 2037 110 197335

484 125 295 526 166 207 72 0 74 68 0 8 2 0 19 2046 127 177940

-2.7 23.2 -21.7 -35.6 12.0 47.3 29.2 4.1 55.9 50.0 -50.0 147.4 -0.4 -13.4 10.9

5825 1529 3622 5273 1882 3192 1151 33 850 1205 36 121 11 6 301 25037 1400 2306241

4293 1537 3042 5935 1895 2246 768 0 789 973 0 146 18 0 253 21895 1459 2066882

35.7 -0.5 19.1 -11.2 -0.7 42.1 49.9 7.7 23.8 -17.1 -38.9 19.0 14.4 -4.0 11.6

Biju Patnaik Airport, Bhubaneswar, Odisha and Imphal Airport, Manipur airports declared as International airports vide Notification No.AV.20014/003/98-VB(AAI) dated 14th November, 2013 by Ministry of Civil Aviation, Government of India.

Source: AIRPORTS AUTHORITY OF INDIA

April-May 2015 I Cargo & Logistics

GAC Logistics Pvt. Ltd. One Company All Solutions • Air Freight • Ocean Freight (FCL/LCL) • Export and Import Consol • Custom Clearance • Project Cargo • Warehousing (Bonded and Normal) • Distribution

Head Office (DELHI) GAC Logistics Pvt. Ltd. B301, Ansal Chamber-I, 3 Bhikaji Cama Place New Delhi - 110 066 Tel: +91 11 26160470/71/72, +91 11 43439999 Fax: 91 11 26160473/26178196 Mob: +91 9711856949 (for Import) +91 9899701132 (for Export) Email: info@gaclogistics.in Website: www.gaclogistics.in

Branches: New Delhi * Mumbai * Bengaluru * Chennai * Hyderabad * Kolkata * Jaipur * Visakapatnam * Coimbatore * Kanpur * Lucknow * Panipat

Multimodal Transportation Logistics

WOMEN IN CARGO

‘Willingness to learn has brought me where I am’ Says Sukhjinder Jhas, Manager (R&D), Cargo Flash Infotech. In her most lucky year in the cargo sector, she feels that she has much to learn Cargo is essentially a male-dominated industry. How did you find yourself in it? Though women in cargo and logistics are few in numbers but their contribution in the cargo industry is tremendous in the recent times. I believe: “Once a person decides to reach out for passion, it is never really difficult to find the way in.” I am happy being part of cargo industry. I believe, with dedication and hard work, it is not difficult to position yourself in this industry.

How many years have you been with the cargo industry and how has the journey been this far?

all my male colleagues have supported me throughout my career.

It has been 13 years I am associated with cargo industry, starting with air cargo operations at the airport, moved to freight forwarding and now to IT as a subject matter expert for cargo. My journey so far is quite interesting as I have been given opportunities to explore different verticals of the cargo industry. For me, it is a new learning at every step and

Yes, that brings us to your colleagues. How have your colleagues reacted to you and what about those reporting to you? I find myself lucky to always have had an encouraging environment. My mentors are very supportive and have believed in my capabilities, which in turn gives me confidence and courage to prove myself in challenging situations. Being a mentor myself, I always believe, that the more you share your knowledge, the more you learn. I encourage a two-way communication which helps in bridging the gap and leads to improved performance. Though I have varied experiences throughout my career, I have specialised in general air cargo operations

What is so exciting about the cargo industry that keeps you attracted to it? My entry in the cargo industry was not planned. However, I find it interesting as every day I have learnt something new and challenging which gives me the spark to continue to be a part of cargo industry.

How confident are you about future growth on equal opportunity basis with male colleagues? In my entire career, luckily I have been given equal opportunities to perform and prove myself in different situations. I have reached where I am today because of my willingness to learn along with dedication and hard work… but there’s still a long way to go.

What advice would you give youngsters especially women - to join the industry? My advice for all the youngster is to be clear on what they want to do and achieve in professional life. Enjoy the work you do to give your best.

April-May 2015 I Cargo & Logistics