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MAN A G ING LO G I S I T I C S T H E W H I T E G OODS W AY Volume III n No 12

C A R G O

FEBRUARY 2015 I `60

L O G I S T I C S

DREAM GIFT

The search to create a hitherto elusive aircargo hub receives a major push from Air Cargo Forum India

RNI No. DELENG/2011/387546

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MANAGING EDITOR’s NOTE

Right Moves, Right Noises

erhaps, the one word that freight forwarders have been hearing through the years is: Hub. At almost every air cargo seminar, the word pops up with regularity. And when it does, bureaucrats and air cargo stakeholders take turns at pointing out what has been done and what more needs to be done to make India an air cargo hub. Of course, it is needless to mention, that with the end of the seminar, all talk of the ‘Hub’ vanishes into thin air. One of the earliest mentions of the ‘Hub’ and a need for it was heard at an important meet in April 2006. Those days, cargo was the step-sister of passenger, a close kin of the ‘ugly duckling’ – always hovering in the background and never able to show its face or demand special attention. Holding fort for the hub concept was no Indian. Speaking at the ‘India Cargo Summit’ organised by Confederation of Indian Industry, the then Singapore Airlines Cargo President Hwang Teng Aun said: “Considering its geographical location, India, especially Delhi, has the potential to become a gobal hub for air cargo.” He went on to emphasise that while India was indeed a good location for the creation of such a hub, in addition, the volumes of international trade was significant too – another pointer for the establishment of a cargo hub. He also said that “even a place like Dubai, where there is not much of manufacturing or exports, is a succesful destination” and that there was no reason why India with all its growth in manufacturing sector and exports and imports could not become another global hub. Among the others who advocated the creation of a hub was Mckinsey & Co’s Associate Partner Kaushik Das who said, “India for most part of the last decade has been building infrastructure and the country has started making big strides.” At that meet, the experts felt that there was a lot that needed to be done for India to become a truly international hub for air cargo. The latest advocate for a hub came from Ulrich Ogiermann, Chief Executive-Cargo, Qatar Airways who said

sometime in August last year that “India with its continued growth in exports, imports and manufacturing industry, has the potential to become a global cargo hub”. Between 2006 and 2014, the government made the right noises and the moves to set up a hub. How can one forget the enthusiasm when Nagpur was projected as “The Hub” that India had been dreaming about since independence? There were critics of Nagpur – and rightly so – who did not think much of the move. After all, there was hardly any industry to feed the hub and apart from its geographical location in the centre of the country Nagpur had little to boast about. And, it is not without reason that Nagpur is all but forgotten. The previous government also did its bit by setting up a Working Group on Air Cargo Logistics in India, chaired by the Economic Adviser to the Ministry of Civil Aviation. The report, submitted in May 2012, recommended policy initiatives to address important issues considering the long term perspective and future growth potential of air cargo in the country. The Working Group, in fact, brought together all key stakeholders of the industry on one platform to discuss and deliberate the challenges of growth opportunities. One wonders what happened to the recommendations made by the Working Group! Today, however, the environment has changed: there is a new dispensation and a new focus. Once again, the initiative has come from air cargo stakeholders to transform any or all our major international airports into hubs. A right move indeed. Coupled with the right noises from the right quarters one hopes that India’s and the air cargo stakeholders’ dream of a hub would be fulfilled. Till then, happy reading!

tghosh@newsline.in

Cargo & Logistics I February 2015

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

CONTENTS

C&L

VOLUME III n NO 12

Editor-in-Chief

K SRINIVASAN Managing Editor TIRTHANKAR GHOSH

H C TIWARI

Consulting Editor RAMESH KUMAR

COVER STORY

p12

An aviation hub in India has always been a dream for the cargo industry. While Dubai, Singapore and Hong Kong have taken great strides, India has not been able to create one such hub. The Air Cargo Forum of India (ACFI) recently organised a meet to discuss on how to transform Indian airports into international cargo hubs.

SPOTLIGHT

p20

LG’s Kishore Kumar Kaul talks about his role in developing Supply Chain Management, his plans and lessons which helped him to improve and innovate. He also talks about reducing costs by improvements and the safety of cargo.

PRODUCT

Senior Sub-Editor-cum-Reporter PUNIT MISHRA Sr. Proof Reader RAJESH VAID Correspondents ANJANA TANWAR, NAVEED ANJUM, CHARCHIT SINGH Designers NAGENDER DUBEY, MOHIT KANSAL Picture Editor PRADEEP CHANDRA Photo Editor HC TIWARI Staff Photographer HEMANT RAWAT Director (Admin & Corporate Affairs) RAJIV SINGH

New technologies impact almost every industry and logistics is no exception. Logistics industry is facing problems such as accuracy and timely delivery. So, to cope up with such problems DHL has successfully tested the Augmented Reality technology in a warehouse.

COLUMN

p24

e-Commerce in India is growing rapidly but India’s logistics sector is not able to keep pace. A large part of the e-commerce success in developed nations has come because of the rock-solid logistics in place. In India, on the other hand, couriers have a hard time finding delivery locations.

NEWS IN BRIEF

Qatar Airways Cargo continues its expansion programme in India with the launch of the seventh freighter destination in the country serving Ahmedabad. In the land section, Schenker India Pvt. Ltd announced the opening of its DB Schenker Logistics Centre (SLC) in Patna, Bihar. FEMA IS THERE In our review of the book on the Customs Act updated by Samir J. Shah, FEMA is, of course, mentioned in the book, as part of the general text. Our reviewer’s point was that it was not mentioned in the backgrounder in the early pages, which is indicative broadly of the points covered in the book.

February 2015 I Cargo & Logistics

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.

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• MRP Based Duty • Surrendering Title of the Goods • Harmonised System & Classification - Introduction; Principles and Explanation • Conversion of Currency • Handling of Cargos in Customs Area Regulations 2009 • Foreign Trade Policy • IEC Code No • INCOTERMS • Bill of Lading • Letters of credi

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JUST IN TIME

2014: GOOD YEAR FOR AIR CARGO

ESA

TREND

RISING HIGH: 2014 ended on a postive note for the Air Cargo industry

ear-end figures from the International Air Transport Association (IATA) and WorldACD both showed impressive growth in demand and volume growth for 2014. IATA released full-year air cargo data for 2014 showing 4.5 per cent demand growth compared to 2013 measured by Freight Tonne Kilometers (FTKs). That is a significant acceleration from the 1.4 per cent recorded in 2013 over 2012. Air cargo market expansion gathered momentum as 2014 progressed. The year finished on a positive note, with growth in December accelerating to 4.9 per cent, compared to December 2013. The vast majority of the growth in 2014, however, was in the Asia-Pacific and Middle East regions, which respectively contributed 46 per cent and 29 per cent of the expansion in FTKs. Growth was recorded in all other regions, but was particularly weak in Latin America. “After several years of stagnation, the air cargo business is growing again. This is largely being driven by the uptick in world trade over the second half of 2014. Recent concerns over the health of the global economy and a corresponding fall in business confidence have not yet impacted air cargo. But it is a downside risk that will need to be watched carefully as we move through 2015,” said Tony Tyler, IATA’s Director General and CEO. WorldACD, measuring demand in tonnage reported on air way-

February 2015 I Cargo & Logistics

bills from more than 50 carriers, reported an overall volume growth of 6.4 per cent in 2014, compared with 2013. Middle Eastbased airlines outperformed all others for the third year in a row, achieving a yearover-year revenue growth of 13 percent. “They were the fastest growing airlines in all areas, whilst they were also the only group with a slightly increased yield worldwide,” WorldACD said. “In other words: this specific group of airlines continued their march towards prominence.” Looking at WorldACD’s monthly figures, chargeable weight in December increased by 6.7 per cent, but yields for the month (in US$) fell again by 5.6 per cent, “a very worrisome figure at first sight,” the report said. Yields for the entire year fell by a more moderate 1.45 per cent. Continuing the trend from previous years, revenues from pharmaceuticals and perishables outpaced the market, with +16.2 per cent and 7.2 per cent respectively. Pharmaceuticals grew in yield as well, (+2 per cent, in Europe even more), more than the 1.2 per cent increase in 2013. But perishable yields dropped by about 3 per cent, double the average of all cargo taken together. The leading origins in both product markets strengthened their position: Africa and Latin America in perishables, Europe and Middle East and South Asia in pharmaceuticals.

New technologies are being trialled in the cargo and logistics industry improving the delivery time and effectiveness of the shipment. Wait at home for a delivery, or visit to a depot to pick up a missed parcel, will soon be over, Fastlane International, pioneering web-based courier claims. New developments in GPS and mobile phone technology means parcel deliveries can now be made direct to you. This may sound unexpected but, in fact such services are already being trialled. Volvo has pioneered the system with Volvo Roam delivery service. Trialled in 2014 in Sweden, the service met with a very positive response. Shoppers who subscribe to the service and have cars with Volvo’s Sensus Connect infotainment system can receive a message before their packages are shipped asking whether they will accept car delivery. Volvo sends a digital key to the delivery company that shows the location of the car on a map and provides GPS coordinates, as well as information like the car’s colour, make, and license plate number. Once located, the delivery person simply presses a button on a smartphone and Volvo unlocks the car via its On Call technology. Afterwards the car relocks and sends the owner confirmation that the delivery is complete. In the UK, a company called Cardrops is also pioneering such a service and works with most modern vehicles. Subscribers to the service have a transmitter beacon installed near the driver’s seat. It’s as easy as having a car alarm fitted. Then Cardrops’ couriers can identify the vehicle and, once it is unlocked by Cardrops remotely, deliver the items.

JUST IN TIME

“ALL-IN” CARGO RATES WELCOMED

E-AWB PENETRATION: INDIA IN TOP TEN COUNTRIES In December, e-AWB penetration reached 24.9 per cent, an increase of 1.4 per cent month over month. India is ranked sixth in top ten countries of origin (ranking by e-AWB volume) with 35.7 per cent penetration in December and tenth in top ten countries of destination (ranking by e-AWB volume) with 21.0 per cent penetration in the same month. Nine IATA member airlines – SAS Cargo, Lufthansa Cargo, Air France/ KLM, Finnair, Korean Air, Cathay pacific, Qatar Airways and Emirates – have taken the lead in the Nordic market to implement the e-AWB for their air freight shipment. IATA’s vision is to see its members go 100 percent paperless by the end of 2017. The Key progresses around the globe includes Chinese Customs in Guangzhou (CAN) supporting e-AWB through the implementation of e-release, therefore the paper AWB is now only needed as a supporting document and Qatar Airways (QR) ending the year with 34.2 per cent, exceeding their 2014 year-end target by 10 per cent.

February 2015 I Cargo & Logistics

EMIRATES

he recent announcements separately by two major and rapidly expanding air cargo carriers, Emirates and Qatar Airways, to return to a simplified All-In rate structure that eliminates the various surcharges e.g. fuel, security etc. is welcomed by Shippers and The International Federation of Freight Forwarders Associations (FIATA). The significant move by the two major airlines is now becoming a trend and is followed by IAG (British Airways and Iberia) and SAS Scandinavian Airlines, increasing the number to five airlines who have announced a shift to an All-In system. Joost van Doesburg, Head of Air

Freight Policy, European Shippers’ Council’s (ESC) was quoted saying to Lloyd’s Loading List.com that he had been at a meeting recently where “15 very big multi-national shippers had congratulated each other on the news that the number of airlines going AllIn on rates was set to grow”. He added: “I think we’re likely to see a snowball effect now. With IAG (British Airways and Iberia) and SAS, we now have five airlines who have announced a shift to an All-In system. We know that some other European airlines, big ones, are thinking in this direction too.” He added that the feedback suggested there was a general feeling among European carriers of being forced into adopting a single rate as a result of the pressure being exerted by the move by Emirates and Qatar Airways. The resistance has come from major European and US carriers who traditionally have had a dominant role in air cargo. But this issue has brought into sharp relief that trend-setting in the industry has now moved to the Middle East.” FIATA also issued a statement welcoming the All-In rate system. “The simplification of rate structures will be a significant benefit to forwarders and shippers alike. Forwarders have for a very long time desired these surcharges be removed as they are opaque and complex and thereby making it difficult to quote a definite price for air cargo transportation, which the shippers are able to understand. The fuel surcharge has come under significant criticism in recent months as fuel prices continue to fall,” FIATA said in the

statement. “Rodolfo Sagel, FIATA’s Airfreight Institute Chairman believes this is a long-awaited move in the right direction that may be supportive of transparency. Transparency in the entire Supply Chain is generally applauded by FIATA, its members and by the International Freight Forwarders client,” FIATA said adding that it believes that this may be the precursor to many other airlines following suit. Meanwhile, some forwarders criticised this system saying that this would be less transparent than the current one in that previously visible charges would now buried in a single price. Reacting to this Doesburg said: “First of all, it seems to be a very small minority of forwarders who are taking this view. Secondly, if there is no noticeable change in the level of rates under the All-In system, then so be it. We have not lobbied for lower rates but for a fairer and more transparent system. Rates are already at historic low levels. What we’ve objected to and for some time now, is airlines’ policy of unjustifiably maintaining the fuel surcharge when oil prices were falling significantly.” Emirates has introduced all-in pricing on air freight shipments to and from Europe from February, 1, 2015 with the new pricing structure including fuel and security surcharges to apply to its entire SkyCargo global network from March, 1, 2015. Qatar Airways said it was taking “a phased approach from April 2015”, when it would transition its cargo pricing structure to the “one-rate” basis.

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NUMBERS

NEW PORTS IN MAHARASHTRA

Maharashtra is likely to get three new ports at Dahanu, Vijaydurg and Revas. The total investment is estimated to be at least `20,000 crore and each port is expected to handle 40 million tonnes of cargo annually. These ports would be developed in association with the state government and the private sector. “The development of these will be under the Centre’s integrated ports development plan, wherein ports, roads and railway network will be simultaneously developed. The Ministry has completed the initial study on these ports and held talks with the Maharashtra government for its involvement,” said Nitin Gadkari, Minister for Road Transport, Shipping and Highways to a daily adding that the aim was to decongest Jawaharlal Nehru Port (JNPT at Navi Mumbai) and Mumbai Port.

18.69 PER CENT RISE IN PROFIT FOR TCI

Transport Corporation of India (TCI) recently announced its third quarter results. Net profit of TCI rose 18.69 per cent to `17.08 crore in the quarter ended December 2014 against `14.39 crore during the previous quarter ended December 2013. Sales rose 7.79 per cent to `555.00 crore in the quarter ended December 2014 as against `514.88 crore during the previous quarter ended December 2013. TCI is the largest private sector integrated logistics company in India. The whole corporation is composed of six general companies including TCI Freight, TCI XPS, TCI Supply Chain Solution, TCI Global, TCI Seaways and TCI Foundation.

February 2015 I Cargo & Logistics

100

B777 FREIGHTERS DELIVERED

Boeing has now delivered 100 B777 freighters. In the middle of January, China Southern Airlines took delivery of the ninth of twelve 777Fs (41634) it had on order with Boeing. owever, Boeing was less interested in highlighting it but it was the 100th

delivery of a B777 Freighter. The first B777F was delivered to launch customer Air France in February 2009. Since then Boeing has delivered 99 more to eleven carriers and five lessors. Following the 100th delivery, Boeing has fifty-three more B777Fs in its backlog.

14%

1.45

RISE IN PROFIT FOR APSEZ

Adani Ports and Special Economic Zone Limited (APSEZ) recently announced the financial results for the third quarter and nine months ended December 31, 2014. APSEZ reported a 14 per cent increase in consolidated profit after tax (PAT) and 38 per cent rise in income in the third quarter of fiscal 2014-15, ended December 31, 2014, compared to the corresponding period in the previous fiscal. Consolidated cargo handled by the company was 39 Million TEUs in the third quarter of the current fiscal, an increase of 33 per cent over corresponding quarter last year. Adani Ports at Mundra handled 29 Million TEUs cargo in third quarter of the current fiscal.

MT OF CARGO HANDLED BY CPCT

Cathay Pacific Cargo Terminal (CPCT), Cathay Pacific’s new air cargo terminal at Hong Kong International Airport, handled 1.45 Million Tonnes (MT) during 2014 in its first full year of operation. On November 8, 2014, the terminal set its highest daily tonnage record of 5,476 tonnes of cargo processed. CPCT’s traffic was 54 per cent transshipment. The percentages of import and export cargo tonnes throughout were 15 per cent and 31 per cent, respectively. “2014 was Cathay Pacific Cargo Terminal’s first full-year of operations. With concerted efforts by our dedicated team, we were able to achieve the highest level of service performance that we promised our customers from the beginning,” said Kelvin Ko, Chief Executive Officer, Cathay Pacific Service Limited (CPSL).

NUMBERS

YEAR AGREEMENT BETWEEN ATSG AND DHL

US-based Air Transport Services Group (ATSG) completed a new five-year agreement with DHL. Under the agreement ATSG will extend its flying in support of DHL’s US operations through March 2019. According to ATSG, some of the principal elements of the agreement were to extended dry leases through March 2019 for the thirteen 767 freighters currently leased to DHL, new dry leases of two 767 freighters through March 2019 and continued operation of these fifteen 767 freighters by ATSG subsidiary carrier ABX Air through March 2019. ATSG once provided almost all DHL’s flying in the US but in recent years DHL has broadened its support base to include both Atlas Air and Southern Air.

17.6% ä

17%

RISE IN CARGO FOR ETIHAD

Etihad Airways reported a 17 per cent increase year-on-year in cargo for 2014 to 569,000 tonnes of flown freight and mail. The Middle East airline accounted for 89.6 per cent of cargo imports, exports and transfers at Abu Dhabi airport last year. “Over the course of last year, Etihad Cargo enhanced its global reach by offering bellyhold capacity on Etihad Airways’ 10 new passenger destinations and expanding its freighter services to new markets such as Dar es Salaam, Entebbe, Hanoi and Moscow. A freighter service was also launched from Milan to Bogotá and from Bogotá to Amsterdam, following an agreement with Avianca Cargo, the cargo division of Latin American carrier Avianca,” Etihad stated.

RISE IN CARGO VOLUME FOR AIRBRIDGE

Moscow-based AirBridgeCargo, the scheduled-service subsidiary of Volga-Dnepr Group, marked its 10th anniversary year in 2014 by carrying a record tonnage of 401,000 tonnes, a 17.6 per cent increase year-on-year, with an average load of 72.6 per cent, well above the industry average. To meet increased demand for its capacity and services from international customers, ABC supported its growth with further investment to upgrade its freighter fleet. In 2014 another new generation Boeing 747-8 freighter joined ABC’s fleet, which now has 13 modern B747 freighters, including six of the new generation -8Fs.

`350

CRORE DREDGING PROJECT FOR GOA PORT

The government has decided to undertake the work for deepening of draft at Mormugao Port in Goa, the first such scheme on Public Private Partnership (PPP) mode at a major port. Adani Group, JSW Steel and Mercator Lines and Dharti Dredgers and Infrastructure are in the race for this dredging project worth `350 crore. The government will very soon take a final decision to select the bidder.

Cargo & Logistics I February 2015

COVER STORY

THE AIR CARGO HUB

DREAM TAKES WING

The country has not been able to create an aviation hub in all these years since its independence. Dubai, Singapore and Hong Kong have taken away cargo and passengers from India. But now with a new government in power, the Air Cargo Forum of India (ACFI) representing the entire air cargo logistics/supply chain in the country, has moved to start a process of “transforming Indian airports into international cargo hubs”. Today, two airports in the south — Hyderabad and Bengaluru — have got into the act with the single-minded desire to become hubs. Tirthankar Ghosh takes a look

February 2015 I Cargo & Logistics

COVER STORY

CHANGI AIRPORT

t can be best described as a fresh initiative to engage the Narendra Modi government and, in turn, interest Indian Civil Aviation Ministry. The Air Cargo Forum of India (ACFI), a nationwide forum representing the air cargo logistics and supply chain sector, recently organized a meet to discuss on how to transform Indian airports into international cargo hubs. Perhaps, what made this meet different from similar ones was the presence of the Minister of Civil Aviation P Ashok Gajapati Raju and Renu Singh Parmar, Economic Adviser with the ministry. The others at the meet were heads of cargo from Delhi, Hyderabad and Cochin airports, cargo handlers Celebi, Delhi Cargo Service Center (DCSC), and airlines like Lufthansa and Air France-KLM. While all agreed about what has now become an oft-repeated refrain – India has the potential to be a global hub for air cargo but it would need to improve upon its infrastructure and cost efficiency for it to make a mark in the international market – Minister Raju reminded everyone present that Indian aviation started with air cargo when J R D Tata flew from Mumbai to Karachi in a Gypsy Moth with mail. Candidly agreeing that he had the least experience in air cargo, Minister Raju in a broadside to past governments, said, “We tend to hibernate. We have to come out of this hibernation…I don’t think we demonstrate teamwork.” He then went on to say that “government regulations ought to facilitate and not become an impediment”. Calling upon the stakeholders to make intentions a reality, Minister Raju said, “We are eagerly looking out for ideas…Please load us with ideas.” Ideas there were in plenty. Stanislas Brun, Managing Director, Air France-KLM, Middle East, Gulf and Indian Subcontinent, said that the vision of an air cargo hub should not limit it to one that caters only to a manufacturing hinterland. “We are in the middle of the whole game – Asia-China-Africa – and we should take advantage of that. A hub should cater to manufacturing as well as transshipment.” Above all, he said that a strong airline should be the backbone of a hub. Tushar Jani, Chairman, DCSC, was more forthright. Forget Nagpur – once

Cargo & Logistics I February 2015

RGIA

COVER STORY

CLASS APART: A view of the pharma zone at Hyderabad International Airport

hyped as the multi-modal hub that India was looking for – because it did not have a worthwhile manufacturing hinterland nor was it ideal for transshipment. Delhi or Mumbai should be the international air cargo hub, he emphasized, and once one of the airports was declared as such, things would fall into place. However, before anything else, he said that Narendra Modi’s ‘Make in India’ initiative would not succeed if it was not changed to ‘Logistics in India’. Our logistics and supply chain should be strengthened. Another idea that came was from Tulsi Mirchandaney, MD, Bluedart Aviation sounded simple enough: “We need to change our mindset of survival to one of growth. Airports,” she said, “had to change their attitudes about cargo being an easy revenue stream.” Murali Ramachandran, CEO-India of Celebi, pointed out rather sarcastically that India’s airports had something in common with Incheon: the number 3. While Incheon cleared cargo in three hours, Indian airports did that in three days. It was left to Economic Adviser Renu Singh Parmar to bring in the government’s perspective. She assured stakeholders that the government was addressing all major issues and the Draft Civil Aviation Policy

February 2015 I Cargo & Logistics

Customs department that has mentions six international carbeen implemented some go hubs. Narendra time ago though it is yet The ACFI initiative Modi’s ‘Make in to become a success, to bring the formation India’ initiative would according to a majoriof an air cargo hub not succeed if it ty of stakeholders. centrestage is laudable was not changed to The government but it will not be out of ‘Logistics in India’. and the civil aviation place to mention that Our logistics and ministry’s ambitious way back in May 2012, supply chain should intent to help India’s a comprehensive report, be strengthened air cargo sector leapfrog “Air Cargo Logistics in ahead cannot be questioned India’ was submitted by a but having heard the same Working Group that was chaired things time and again, stakeholders reby the then Economic Adviser, Minismain skeptical. try of Civil Aviation. The Working Group Writing some time ago in C & L, veterbrought together all the key stakeholders an freight forwarder and former President of the industry in one platform to discuss of Air Cargo Agents Association of India and deliberate the challenges of growth op(ACAAI), J Krishnan pointed out the innuportunities in the context of faster pace of merable instances when logistics and aireconomic growth in India and to identify line stakeholders raised the issue of making areas that required further improvement. India an air cargo hub. He also questioned Set up by the Ministry of Civil Aviation, the the possibility of such a hub ever being cregroup’s report recommended “policy iniated? Though airports like Hyderabad and tiatives to address important issues considBengaluru have often stated their intention ering the long term perspective and future of becoming major gateways of South In(air cargo) growth potential in India”. Recdia, till the infrastructure around the airommendations made in the report required ports and the links to the airports from the action needed from Ministries/Departments hinterland are completed there is no way of Government of India, Central Board of these airports could become gateways, he Excise and Customs, etc. One such recaverred. ommendation was the 24/7 working of the

WIKIMEDIA

COVER STORY

ABLE AND EFFICIENT: A view of Bengaluru Airport

Krishnan pointed out the current deficiencies in regulations, infrastructure, processes and policy that need to be identified and innovative solutions found. “Commercials will ultimately determine the success of the project as India does not enjoy the first mover advantage,” he wrote and emphasized that “in the current scenario aviation hubs — regional or International — will remain a distant dream”. What then is the situation on the ground? On their part, the country’s top international airports are keen to establish themselves as major Indian gateways. MR’s vision of making the Greenfield airport at Hyderabad — the Rajiv Gandhi International Airport (RGIA) — as “the logistic hub of India” came a little

closer to fulfillment when the airport’s cargo division received two awards at the end of last year. Presented at the Payload Asia Awards, 2014, these were the Middle East/ Indian Subcontinent Airport of the year and the Green award. An elated S G K Kishore, CEO, GMR Hyderabad International Airport Ltd (GHIAL) said that the award recognized the airport’s all-round operations. Like Hyderabad airport which has received many laurels at national and international forums, RGIA’s cargo has also received significant recognitions like ‘Best Cargo Airport and Best Cargo Terminal’, ‘Best Emerging Cargo Airport of the year’ in the year”. Hyderabad boasts of a modular integrated Cargo facility at RGIA, which is

spread over 14,330 sq.mts with a capacity to handle 150,000 MT annually. An exclusive apron, adjacent to the cargo terminal caters to the cargo facility and is capable of accommodating Code-F aircraft. A Pharma Zone was set up to handle the pharma products at desired temperatures. The cargo complex also provides space for two animal quarantine stations, plant quarantine station and drug controller. With the country’s first airport-based Free Trade Zone (FTZ) that is envisioned to fuel the growth of a strong airport-driven economy, RGIA provides compelling value proposition to players across the industry value chain by offering modern and integrated ecosystem that promises to bring down transportation costs and reduce the

Cargo & Logistics I February 2015

CHANGI AIRPORT

COVER STORY

OPERATION PUSH: A FedEx plane during the operation at Changi Airport

turnaround time for movement of goods. The FTZ will also provide facilities for servicing, distribution, trading, warehousing of goods and other value additions. These are strong pointers to boosting air cargo growth. Pushing the air cargo hub concept through, the GHIAL management has taken a leaf out of successful airport stories being played out at Singapore, Dubai or Memphis, where there was little or no industrial activity. Today, the Hyderabad airport is not only thriving but unlike Memphis International Airport, GHIAL’s vision is to develop an aerotropolis around it; link the airport and businesses in the hinterland; offer quick efficient access to suppliers and customers through the country and the world; attract investments, create jobs, boost economic growth around the airport and, of course, in the process develop an integrated Logistic Hub. To add muscle to the hub concept, GHIAL has done some basic research comparing the UAE with India. While the UAE (Area: 83,600 sq km) with its GDP of $47,729 handled 16,951 MT of air cargo per billion dollars of GDP output, India

February 2015 I Cargo & Logistics

with its 3,287,263 sq km area and a GDP of $3.694 handled only 516 MT of air cargo per billion dollars of GDP output. India, in fact, is nowhere near Hong Kong (12,883.4 MT/bn $ GDP) or Singapore (6,164.4 MT/ bn $ GDP). There is, therefore, potential for India to play a major role in the air cargo market. Said Hemanth D P: “Airline operators who come to the airport often joke and point out that the Hyderabad airport is the best kept secret in the world.” They are “stunned at the beautiful facility that has been created”. Yes, there is the classy terminal and manicured gardens all around but below all that is “a solid hardcore pyramid the apex of which is a hub,” said Hemanth. While upgrading facilities for cargo movement is only one part of the RGIA story, the airport has chalked out carefully crafted out plans for development of the hub. There is the aerotropolis on 1,000 acres that Hemanth mentioned. The aerotropolis — a new urban concept that places an airport in the centre with a city growing up around it — will promote education, healthcare, entertainment, hospitality, com-

mercial and logistics ports. The airport authorities have signed an agreement with the Apollo Group to set up a hospital. In addition, the airport has got in touch with international corporates to form joint venture partnerships on the proposed 1,000 acres. An aviation special economic zone spread over 250 acres is scheduled to be set up. eanwhile, virtually next door at the country’s IT hub in Bengaluru, the Bengaluru International Airport (BIAL) has geared up to become a ‘gateway’ to south India. Led by the hands-on G V Sanjay Reddy, Managing Director, BIAL and Hari Marar, CEO, the Kempegowda International Airport is ahead in its expansion plans that comprise the integration of the existing structure with a newly constructed one. With the enhancement, BIAL is a step closer to its vision of becoming the gateway to South India. Cargo volumes handled at the airport in 2014 grew by 13.7 per cent compared to 2013 to reach a total volume of 270,840 metric tonnes (MT) in 2014. September 2014, for example, recorded the highest domestic cargo tonnage turnover of 10,744 MT, resulting in 38 per cent month-

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PERFECT PODIUM: (Left to Right) Stanislas Brun, MD, Middle East, Gulf and Indian Sub-continent, Air France-KLM; Pradeep Panicker, President, ACFI; Ashok Gajapati Raju, Minister of Civil Aviation; I P Rao, CEO, Delhi International Airport; Rafeeque Ahmed, President, FIEO and Veli Polat, Regional DIrector, South Asia and Middle East, Lufthansa Cargo at the recently concluded ACFI forum meeting

on-month growth from 2013. In a pioneering initiative to improve efficiency and accuracy, reduce turnaround times and paper usage, KIAB became the first airport in the country to be IATA e-freight compliant, successfully completing a proof-of-concept and operationalisation of e-freight facility. In a demonstration of world-class cargo capabilities, the first international ramp-to-ramp transshipment was executed between Singapore, Bengaluru and Frankfurt from the airport. As for the question of transforming the airport into a hub, Marar said that BIAL’s vision statement was clear. “We would like to be the gateway to South India, we would like to be the hub for the entire southern peninsula. We believe that we have the potential for it not for one or two but several reasons,” he said. To begin with, with the close of year 2014, the airport reported that over 14.38 million passengers were served in the year. A resurgent domestic aviation market saw new airlines and routes, resulting in a 14 per cent increase in Air Traffic Movements (ATMs) with an average of 359 ATMs per day. Domestic ATMs increased by 15.4 per cent and clocked 110,773 movements in 2014, while international ATMs rose to 20,330. The airport handled 12.5 per cent more passengers as compared to last year, making it the third busiest airport in the country. Domestic passenger traffic recorded a

February 2015 I Cargo & Logistics

growth of 13.5 per cent compared to the ly from Bengaluru. Luxury international previous year and clocked 11.55 million fliers were introduced to La Premiere firstpassenger at the end of the year. Internaclass service of Air France in 2014. Additional passenger traffic grew at 9 per cent. tionally, with the help of the revised flight The year also marked the opentimings Air France brought the US ing of the extended terminal West Coast closer to Bengawith enhanced facilities, luru, offering passengers A resurgent along with new comshorter flying hours for domestic aviation mercial offering and travel from San Franmarket saw new the capacity to handle cisco to Bengaluru. airlines and routes, 20 million passengers Among domesresulting in a 14 per annually. G V Sanjay tic new routes, there cent increase in Air Reddy, Managing Diwas one to Nagpur by Traffic Movements rector, BIAL, said, “A Go Air, Bagdogra and (ATMs) at focused approach cenVizag by Indigo, VaBengaluru airport tered around the passenger dodara and Jammu by Jet experience has paid rich divAirways and Jetlite, Ahmedidends, making the Kempegowda abad, Coimbatore, Hyderabad, International Airport, Bengaluru a strategic Chennai and Vizag by Air Costa. aviation hub in under seven years of its opSecond, geographically, Bengaluru erations. I am also delighted that this growth was in the centre of the southern peninsula, has been achieved in a sustainable manner, and three, Bengaluru had the shortest averwith due consideration to the environment, age distance between various south Indian the community and the surrounding region. points when compared to any other points The new connections, facilities and services in south India. In terms of traffic, Bengaluru launched this year are a step forward in raishas been traditionally highly underserved ing the bar for airports around the country.” therefore the possibility to consolidate the With a constant focus on improving south Indian traffic in Bengaluru is very connectivity from Bengaluru, 2014 was a high. Five, today, South Indian traffic was year for many new connections at the airlarger than any other region of India. “All port. AirAsia commenced operations from this,” said Marar, “leads to a very clear fact KIAB and declared Bengaluru as their prithat there is a tremendous potential to cremary hub airport. Existing airlines like Indiate a hub and that potential is been backed go and Jet Airways introduced international by a vision and a comprehensive strategy to flights to Dubai and Abu Dhabi, respectiveachieve that vision.”

H C TIWARI

COVER STORY

RESEARCH

Getting Indian airfreight on track

ncreased aggregate demand due to encouraging international trade and Gross Domestic Product (GDP) trends has been the primary driver of air cargo services in India. This comes as no surprise as the country’s merchandise export and import registered a double-digit average annual growth rate of 9.5 per cent during the fiscal year (FY) 2009-2013 period, while GDP grew at a compound annual growth rate of more than 6 per cent within the same timeframe. According to a recent report ‘Strategic Analysis of Growth Opportunities in Indian Air Cargo Market’ by market research analysts at Frost and Sullivan, the total market opportunity for air cargo services in India amounted to 2.26 million tonnes in FY 2014 and is estimated to reach 2.8 million tonnes by FY 2018 at a compound annual growth rate of 5.5 per cent. The study covers domestic and international air cargo. Srinath Manda, Program Manager, Transportation and Logistics Practice, Frost & Sullivan, said, “The relaxation of the cap on Foreign Direct Investment (FDI) in the aviation sector has given a strong thrust to

the air cargo market. The Indian Government’s FDI policies have been particularly favourable towards private participants entering the market. Major policies fuelling market growth include the allowance for 100 per cent FDI in existing airports and under automatic routes as well as 100 per cent tax exemption for airport projects for the next ten years.” The report further explained that the lack of dedicated air cargo warehousing facilities at India’s major airports at Mumbai, Delhi, Chennai, Kolkata, Bengaluru and Hyderabad, had slowed down market development. Domestic air cargo operations have been limited as most warehousing facilities cater to international cargo owing to the dearth of space in Tier II and III cities. Further, the restrictions imposed on providing licenses to operate bonded warehouses had been causing severe capacity constraints and impeding the air cargo market. International air cargo segment was about 64.2 per cent of the total market while domestic segment contributed to the remaining market. Considering the future outlook, over

the next 20 years, world air cargo traffic is expected to grow 5.2 per cent per year. Among the 106 domestic airports in India, 35 key non-metro airports hold good potential to be converted into cargo ports. Potential commodities that can be airlifted include precious metals and jewelry, textiles and garments, chemicals and pharmaceuticals, leather products, and perishable goods. Nonetheless, market momentum will pick up soon as the Airport Authority of India (AAI) has identified 24 airports in which unused cargo terminals can be converted to common user domestic cargo terminals. Along with the AAI’s programme dedicated to establishing centres of perishable cargo to cope with the rise of domestic air cargo movement involving perishable goods, this will keep market revenues on a steady upward trajectory. “Evidently, opportunities for market participants lie in common user cargo terminal development and management at airports, domestic air cargo carrier services, commercial and passenger cargo handling at airports, and perishable cargo storage facilities development and operation,” concluded Manda. The report suggested key market drivers and restraints in the report for Indian airfreight, that were: • International trade growth boosts air cargo volume in the international airports in India • Relaxation of the cap on FDI in aviation to enhance growth of Indian air cargo market • Lack of alternative rapid cargo transport modes acts as a driver • Lack of sufficient air cargo handling infrastructure restrains growth of the Indian air cargo market • Lack of dedicated and scheduled cargo airlines is restraining the growth of the Indian air cargo market • Fluctuation in aviation fuel prices may affect the aviation sector and air cargo market in India

Cargo & Logistics I February 2015

SPOTLIGHT

LG is for Logistical Genius Kishore Kumar Kaul, Head of Supply Chain at LG India in conversation with Consulting Editor Ramesh Kumar How long is your association with LG? I joined the company handling Goldstar business where I handled procurement, import and planning of Goldstar brand in India. For two years I was there and then I went back to my old company, Rajasthan Petro Synthetics. In 1997, when Goldstar came to India as LG Company, I joined back. So, if you see association with LG it’s since 1993, around 22 years now…

thought of developing a supply chain management programme where we needed to look into all these aspects and reduce my lead time, my cost and improve my visibility right from my raw material which I have to import to the end product lying in my warehouse for the last three or four months because we had to look at the ageing of the products also. That is how the concept of supply chain management came into existence.

What exactly did you handle for LG? When LG started in India, I joined to take care of imports. We were setting up the plant, so we had to import everything. Initially for about three years, we were getting our products manufactured from outside. First, we started only with TVs and in April 1998 when we started this plant (Delhi), we started with the production of washing machines and then refrigerators also. It is all basically logistics for a separate portfolio. But logistics then was only about products being shifted from one location to another in warehouses. Imports were separate. It used to be PPC (Production Planning and Control) which I was handling, discussing with sales what they wished to sell, based on that what should I import and based on that what should I produce and then give to logistics.

When did full-fledged logistics start in LG? In 2002, we thought of combining all these aspects and developing Supply Chain Management (SCM), where we have an overview of everything about what is happening, where we can control, what we know, what production do I need to control based on the inventory I have in different warehouses, and based on that what import is necessary, and again, based on that what is the transit time in terms of import. So, we

February 2015 I Cargo & Logistics

How do you space out your work? We have a weekly frozen plan, a daily frozen plan, and an hourly frozen plan. Based on those plans we inform the supplier. So, the supplier knows about the line I am working on and the model. There is 100 per cent transparency, so they supply the components based on my production line. The vehicles come in based on my production line; they go straight to the line where the materials are offloaded immediately, and those materials go on the line.

Share with us three critical lessons which helped you improve and innovate. The first critical lesson is ‘meet the market’. It means market demands

change suddenly. When a customer comes to a shop he can choose anything — we should be available at that point of time. You should be his choice, number one. You can be that only if you are present in the market. Visibility on the shop floor level is critical. So when we plan, we have to plan in a way that we are always available there. It means inventory management is critical at the store level, at my Regional Distribution Center (RDC) level and at my factory level. So, the first thing is improvement which we convert into demand forecasting. We have been working to improve our demand forecast accuracy in the last three to four years. We try to manage accuracy model-wise. In refrigerators, for example, I have 60 models. So, what is the accuracy of that particular model? I cannot keep on increasing inventory for that particular model and start supplying another model just to compensate that. I have to sell the model which I have produced. So we monitor forecasting based on that model. And our accuracy rate model wise is

SPOTLIGHT

around 40 per cent considering that we take into account our 44 warehouses and 2,500 dealer points.

How do you capture? We have a system where we capture the dealer point-wise sale on a daily basis where we get data real time. And then, we see the forecasting of my branch for that dealer and how accurate is theirs. We keep on correcting and guiding our branch based on the data and they keep improving. That’s the way we like to improve our forecasting. Looking at 40 per cent accuracy, we have to ensure that our inventory does not go very high and we also have to manage the inter-bank transfers, it is not that since my inventory at one branch or one particular model is increasing I start shifting the inventory to another branch, my cost will go up three times…so that is also a point that we control.

How do you keep the cost low, beyond cutting down the transportation? We have a different concept. We reduce

our cost by improvements. First, how can I improve the safety of my vehicle? If I utilise my vehicle with 100 per cent safety I will improve my cost. Second, how can I utilise my warehouses to the optimum level. Third, how can I improve my manpower output to reduce my cost in logistics, in supply chain, transportation, warehouse rent and manpower. These are three major costs.

What level of automation have you opted for? How optimally can I utilise my warehouses in terms of stacking, in terms of usage... if I reduce the damages to my warehouse, my stacking improves. If I have damaged products I cannot stack those products. How can I go for automation of my warehouse to faster loading and unloading so that my manpower is used optimally too? Our core team manages both the plants, and it is all centrally monitored from here. Their major responsibility is to scan the whole operation for leakages, cost control, customer satisfaction, to keep on meeting

the dealers and distributors, to see how they are working, what kind of problems they have. They are also coordinating with the factories and with my sales team.

What efforts do you take for cargo safety on road? We put one time seal on the truck and record the seal number. The doors are welded. Nobody can open them. Three or four years ago we found that even though the seal was intact, the material was stolen. We found that the hinges were being removed, so we sealed, welded them with our own seal. This is one way. Second, all our material is insured, we take end to end insurance. Third is the transporter who we work with. We do not keep on changing our transporters. Some of them have been with us for the last 18 years. They also take care of material the way we take care of them. There have been issues like the driver was killed and the material stolen. Hardly any time has the trucker joined hands with the culprits…

Cargo & Logistics I February 2015

SPOTLIGHT

How do you select your transporter? The first criterion is that the transporter should have his own fleet of a minimum of 75-100 vehicles over an above which he can rent vehicles from the market. Suppose a new transporter comes up and says I want to work with you. First we ask how many vehicles does he own and if he says I have this many and I also get from the market, my second question would be, how will you do that without cutting into the other transporter’s share of rented vehicles because I know how many are available in the market. We do not want our transporters to compete with each other. If you can, add a number of vehicles to my total kitty but do not cut and do not compete.

What kind of training do you give to your own people? First training I give to my people is to be transparent, be truthful with all, with whoever you are working, and outsiders. Be transparent enough so that people know where they stand, not where I stand. Because of my operation he has some standing. Like my sales person is answerable to

February 2015 I Cargo & Logistics

my market, my manufacturing person is answerable to my line, and my transporter to his own company and his own business. My supplier is answerable to his own company. This way everybody knows what action to take. Secondly, I tell them, do not waste money and time, because finally wastage is equivalent to cost and each wastage leads to some cost to the organisation. Even if I am losing one hour of my activity, finally my organisation is losing one man-hour where we spend money and in terms of operation also manpower wastage or space wastage.

Fixing freight is a sticky issue in the transport industry. What has been your experience and how do you treat your transporters? We have no escalation clause in our contract. We do lanewise freight fixation and then we give more or less based on the diesel. And we are transparent, we have the same rates with all the transporters, if I am plying say Noida to Guwahati, I have same rates with ten transporters whosoever is going to work, there is no favoritism…like

say we are running on 34 lanes or 40 lanes. All 40 lanes have same rates for same size of vehicles, that is the kind of transparency we have. Trade partners or suppliers, nobody needs to come to us for payments. We have a fixed payment day when his account gets credited automatically on that day. Rather our people are pushing them to submit their bills in time because we have a system of quarterly and monthly system of billing management.

Do you believe in Just in Time? Just in Time (JIT) is there. It is very good in terms of manufacturing where we should not keep inventory, because ultimately inventory is money — whether it is finished goods or my components, and if we go back, my supplier is also keeping inventory with himself. So, everybody is pouring money to keep the money idle with them, so why to do that? We should keep rotating them into the business that’s why JIT came into picture. Transcript & Editorial Coordination: Sarada Vishnubhatla

COLUMN

Know your geography With e-commerce reigning supreme, couriers have a hard time finding delivery locations. The process could become simpler if delivery executives as well as those placing the order know their PIN numbers, writes Ramesh Kumar Ramesh Kumar

READY FOR DELIVERY: A DPD parcel with complete address ready to be shipped

In this age of booming e-com, last mile delivery particularly in the Indian context is a real challenge. Unlike the matured economies, homes are not numbered sequentially nor has Google Maps succeeded in reaching the street level and house level visibility to assist on a pan-India scale 24

February 2015 I Cargo & Logistics

rofessor Veni Mathur is aghast that practitioners of logistics and supply chain attach little importance to geography and, “it’s a disaster” from the first and last mile connectivity, if she is to be believed. Actually, she is absolutely right. In this age of booming e-com, last mile delivery particularly in the Indian context is a real challenge. Unlike the matured economies, homes are not numbered sequentially nor has Google Maps succeeded in reaching the street level and house level visibility to assist on a pan-India scale. Delivery hands struggle to pinpoint the correct location, thus precious milliseconds. “Parcels meant for Ladakh going to Lucknow is nothing unusual,” elaborates Mathur, who used to teach transportation economics at Indian Institute of Technology-Delhi a couple of years ago. How? Simple. The confusion arises over the inability of differentiating between the symbol or lettering “LKH” for Ladakh and “LKO” for Lucknow in the collection centre. Geography, she points out, is not

taken seriously. The introduction of Postal Index Number or Pincode, it was rightly felt, would ease locating delivery points. The Pincode system was introduced on August 15, 1972 to simplify the manual sorting and delivery of mail by eliminating confusion over incorrect addresses and different languages used by the people. There are nine PIN zones: eight regional ones and one Army zone. The first digit of the PIN code indicates the region. The second digit indicates the sub-region, and the third digit indicates the sorting district within the region. The final three digits are assigned to individual post offices. The first three digits of the PIN represent a specific geographical region called a sorting district that is headquartered at the main post office of the largest city and is known as the sorting office. A state may have one or more sorting districts depending on the volumes of mail handled. The fourth digit represents the route on which a delivery office is located in the sorting district[2]. This is 0 for offices in the core area of the sorting district.

COLUMN

PIN NUMBERS 1. Delhi, Haryana, Punjab, Himachal Pradesh, Jammu and Kashmir, Chandigarh 2. Uttar Pradesh, Uttarakhand 3. Rajasthan, Gujarat, Daman and Diu, Dadra and Nagar Haveli 4. Goa, Maharashtra, Madhya Pradesh, Chhattisgarh 5. Andhra Pradesh, Karnataka, Telangana 6. Tamil Nadu, Kerala, Puducherry, Lakshadweep 7. Odisha, West Bengal, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Andaman and Nicobar Islands, Assam, Sikkim 8. Bihar, Jharkhand 9. Army Post office (APO) and Field Post office (FPO) Delivery Office & System Take, for example, a post box with PIN 571120 marked on it. The last two digits represent the delivery office within the sorting district starting from 01 which would be the GPO or HO. The numbering of the delivery office is done chronologically with higher numbers assigned to newer delivery offices. If the volume of mails handled at a delivery office is too large, a new delivery office is created and the next available PIN is assigned. Thus two delivery offices situated next to each other will only have the first four digits in common. Each PIN code is mapped to exactly one delivery post office which receives all the mail to be delivered to one or more lower offices within its jurisdiction, all of which share the same code. The delivery office can either be a General Post Office (GPO), a Head Office (HO) or Sub Office (SO) which are usually located in urban areas. The post from the delivery office is sorted and routed to other delivery offices for a different PIN or to one of the relevant sub offices or branch offices for the same PIN. Branch offices (BO) are located in rural areas and have limited postal services. It is no secret that online buying for everything under the sun is spreading like wildfire. More and more Tier 2 and Tier 3 purchase orders are pouring into e-com portals. With big ticket players such as Amazon, Snapdeal, Flipkart, etc. creating more heat and action – thus giving a run for the money to brick and mortar shops – same day delivery has become a necessity to survive. Given the wide reach of smartphones and SMS alerts of tracking and tracing of every single item

dispatched with the rider’s name, mobile number, delivery window on any given day, the business is becoming exciting. Ultimately, the delivery management or order management is quintessential. It is just not IT spend but the physical delivery by dispatch executives in every city and town that is of paramount importance. Obviously, the awareness about geography or topography of each locality is critical for swift delivery within the promised time. The dispatch desk at manufacturing or mother warehouse where fresh stock is accessible has its task cut out. Any mis-directed dispatch in the absence of good geographical knowledge will only lead to poor customer service and their ire – publicly use social media. The task gets even more challenging at remote warehouses from where the last mile connect/delivery takes place. These delivery executives need to be like the conventional postman who knows each and every house number and their inmates. Of late, this is becoming even tougher, thanks to gated communities of massive skyscrapers or multi-storeyed apartments that houses hundreds of homes and thousands of inmates. Needs vary and, therefore, each one in every home places orders for their goods of their choice. Hence multiple trips to the same gated community or same street or same building has to be planned well – something like the Coke and Pepsi delivery vans do on a daily basis. Poor geographical or topographical knowledge means poor logistic planning. Waste of time. Waste of money. Poor services. Customer dissatisfaction. Loss of Brand value. Lowering of sales. Low turnover. Bad business prospects. Such is the cycle in the hyper-delivery and “instant gratification’’ society which we inhabit. It is time to dust up our geographical knowledge. Nothing to be ashamed of for buying City maps with street level demarcations wherever one operates. What are you waiting for, folks? (The author is Member, Committee on Supply Chain & Logistics, National Centre for Cold-Chain Development - A Govt of India Organisation Under Ministry of Agriculture. He is also author of 10,000 KM on Indian Highways, Naked Banana! and An Affair with Indian Highways

Each PIN code is mapped to exactly one delivery post office which receives all the mail to be delivered to one or more lower offices within its jurisdiction, all of which share the same code. The delivery office can either be a GPO, HO or SO which are usually located in urban areas Cargo & Logistics I February 2015

FOCUS

‘Indian forwarders are becoming global’ ACAAI President S L Sharma recounted the changes that have been taking place in the Indian freight forwarding community at the WCA

S L Sharma

India is one of the fastest growing economies, it still rates as one of the toughest market to do business in. India’s rank in the index – ease of doing business -- is 142. Our Prime Minister wants to bring this rank to 50 over next two years 26

February 2015 I Cargo & Logistics

he World Cargo Alliance Conference week, comprising the 17th WCA First Annual Conference and the 7th WCA Worldwide Conference was held recently at the AsiaWorld Expo in Hong Kong. One of the world’s largest global logistics events, it recorded a 7 per cent growth in the number of delegates from last year’s event attracting more than 2500 senior executives from logistics companies from over 150 countries. WCA President David Yokeum said, “As the world’s most powerful and successful global logistics network, we are constantly amazed at the sheer volume of new business this conference generates for our member companies. The importance of these companies to the global economy is now being recognised.” He went on to add that organisers this year “were deligthed to welcome senior executives from the world’s leading cargo associations and regulatory bodies, as well as industry leaders from airlines, IT providers and equiment vendors.” The air freight forwarders of India were represented by S L Sharma, President, Air Cargo Agents Association of India (ACAAI), at the WCA Conference. In the speech he delivered to the world body, Sharma mentioned that the Indian forwarders were becoming global: they were not just expanding into other parts of the country but also increasing their footprint in other countries of the world. EXCERPTS FROM HIS SPEECH: India with its 1.3 billion people is one of the oldest civilizations on the planet. Of this population, 63 per cent is in the age group of 15-64 years making it the largest work force of the world. India in GDP terms is the 10th biggest economy, worth 2.07 trillion US dollars and one of the fastest growing economies of the world. The growth rate for 2014-15 is expected to be 6.9 per cent and the economy is expected to grow at over 8 per cent over the next 3-4 years. India is one of the world’s biggest traders

and rated 10th largest exporter and importer of goods. Economic growth and increased international trade means India’s freight forwarding market is expected to enjoy considerable expansion over the next few years. With the economic outlook generally healthy, foreign direct investment on the rise and the transport infrastructure of India due to witness major improvements, freight forwarders and logistics companies look set to reap the benefits. The Indian freight forwarders have also been constantly evolving and transforming themselves over the last decade. The general perception about the Indian forwarder is that they are slow in communication, love negotiating, do not change fast enough and stay within their comfort zone is changing now. The Indian forwarders today are expanding and becoming global. They are not just expanding into other parts of the country but also increasing their footprint in other countries of the world. While India is one of the fastest growing economies, it still rates as one of the toughest market to do business in. India’s rank in the index – ease of doing business — is 142. Our Prime Minister wants to bring this rank to 50 over next two years. Some of the reasons for this low rating are the lack of infrastructure and complex regulations in India. But India is witnessing some very impressive and positive leadership drives over the recent months. The new government is creating an extremely positive political environment for all businesses to buckle up for huge and exciting opportunities. The new government’s ‘Make in India’ drive is making the global business giants look at India with loads of possibilities and re-position their plans for the biggest democracy of the world. This drive will surely lead to creation of new manufacturing hubs, improvement in infrastructure, creation of additional employment and lead to a positive impact on the GDP of the country.ACAAI is the premier association of the country representing the interest of Indian freight forwarders to the various ministries and regulators. The association provides a regular medium for dialogue with the members, the

WCA

FOCUS

HUGE SUCCESS: One-on-one session at WCA conference in Honk Kong

airlines, the customers, and various government authorities. ACAAI maintains close contacts with world bodies related to the air cargo trade, and represents matters affecting our country’s airfreight forwarding industry at various international forums. ACAAI is the only forwarder association recognized by the government of India and is always made to be a part of various government committees, including the standing committee on promotion of exports by air (SCOPE), advisory committees and cargo facilitation committees of the Airports Authority of India (CAFAC), amongst others. Under the chairmanship of the Minister of Civil Aviation the ‘Air Cargo Logistics Promotion Board’ has been formed and ACAAI is a major part of this board. THE OBJECTIVES OF ACAAI ARE: (i) To encourage and promote friendly feeling among air cargo agents on all subjects involving their common good and benefit. (ii) To set up and maintain high ethical standards within the trade. (iii) To promote the interest of air cargo trade in

matters of inland and foreign trade, shipping, railways, roadways and air transportation. (iv) Improve air cargo trade in general and conditions of air cargo agents in particular. ACAAI is instrumental in bringing various issues pertaining to freight forwarders regarding infrastructure, setting up of air freight stations, reduction of dwell time, 24 x 7 custom clearance and doing away with congestions at airports, with the Ministry of Civil Aviation and Ministry of Commerce. India is now a land of huge opportunity. It will not just be a major manufacturer in the future but is surely going to be one of the biggest consumers of the world. It is a market none can afford to stay away from. I am confident that the forwarders in India will continue to work along with their partners across the globe to boost Indian trade. WCA has been a leader in bringing small and medium size forwarders together. They have played a major role in helping developing economies like India to connect with other economies through this wonderful networking platform. This task is not easy and hugely commendable.

India is now a land of huge opportunity. It will not just be a major manufacturer in the future but is surely going to be one of the biggest consumers of the world. It is a market none can afford to stay away from Cargo & Logistics I February 2015

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AIR  VIRGIN EXPANDS CONTRACT WITH IGAT Virgin Atlantic Cargo has awarded a new and extended General Sales and Service Agency (GSSA) contract to InterGlobe Air Transport (IGAT) in India. The new contract follows an extensive tender process and in addition to extending

its 12-year working partnership with Delhi-based IGAT for cargo sales, Virgin Atlantic has also awarded IGAT with the GSSA contract for the airline’s VEX courier express product to streamline the sales process with customers in India. Neil Vernon, Vice President Sales Asia- Pacific, Virgin Atlantic, said, “India is a very important air cargo market and one we have been proud to serve for nearly 15 years. As well as carrying a wide range of shipments from India to major regions of the UK and Ireland, our fast connections over London mean customers in India also use Virgin as their preferred carrier to New York, Los Angeles, Chicago, Boston, Miami, Washington and Atlanta and we expect to see these volumes increase as a result of the improvements in the U S economy.”

MIAL IS E-FREIGHT COMPLIANT International Air Transport Association (IATA) has rated Mumbai International Airport Ltd (MIAL) as e-freight compliant for adopting paperless initiatives at the air cargo operations in Mumbai. This initiative aims to minimise and subsequently eliminate the vast quantities of paper documents the air cargo industry relies on today to support movement of air freight. MIAL is a joint venture between state-run Airports Authority of India and GVK-led consortium, with each having 26 per cent and 74 per cent holding respectively. The e-freight compliance involves

February 2015 I Cargo & Logistics

Qatar’s freighter service to Ahmedabad

atar Airways Cargo continues its expansion programme in India with the launch of the seventh freighter destination in the country serving Ahmedabad. The twice weekly Airbus A330 freighter service departs Doha on Tuesdays and Fridays with a stop in Mumbai before heading to Ahmedabad. Departure from Ahmedabad to Doha is scheduled on the same day.

Ahmedabad has emerged as an important economic and industrial hub in India, and textiles, chemicals, automobiles and pharmaceuticals are some of the city’s major industries. The year 2014 was a highly productive one for Qatar Airways Cargo with the launch of QR Pharma for pharmaceuticals and healthcare products and QR Fresh for perishable products. The carrier also launched 11 dedicated freighter destinations in 2014, including Delhi and Hyderabad in India.

Cathay to serve Kolkata C athay Pacific Airways recently announced a further expansion of its freighter network with the launch of a new service to Kolkata, commencing March 11, 2015. Cathay Pacific will become the only carrier providing direct freighter services between Kolkata and Hong Kong. The scheduled service will operate twice a week on a Hong KongNew Delhi-Kolkata- Hong Kong route. James Woodrow, Director Cargo, Cathay Pacific said: “India is a very important market for Cathay Pacific and we are delighted to build on our existing network of five freighter destinations in the country. The new Kolkata service will boost the flow of garments and food products to and from India, taking advantage of our world-class facilities in Hong Kong to connect to our comprehensive global cargo network.” CHAMP for new IT platform: Cathay Pacific has selected CHAMP Cargosystems

(CSS) to provide their new cargo IT platform following a successful six month design phase. CSS, as it is known, is a further step in Cathay Pacific’s ambitions to remain at the forefront of harnessing technology to support world class process and people as an integral part of its drive for improved competitive advantage, CHAMP said in a press release. Meanwhile, the carrier also launched a new cargo mobile application that offers cargo agents, forwarders and customers greater convenience when tracking shipments, in addition to a wide range of other information relevant to the operations of Cathay Pacific Cargo. The new Cathay Pacific mobile app allows customers to track shipments through their smart phone or tablet device at any time and from anywhere. Customers can also review the e-booking status of their shipment by logging into the app, just as they would with the cargo website.

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Etihad Cargo launches new management system

AIR  air carriers, freight forwarders, ground handlers, shippers and customs authorities to effectively streamline processes, cut costs and improve speed and reliability. Some of the benefits of e-freight compliance are Process efficiency, Productivity, Improved quality and reliability, Cost savings and Environment-friendly.

DIAL TO EXIT CARGO OPERATIONS

tihad Cargo successfully shifted to a new cargo management system to provide its customers with greater communication and improved handling processes. The new state-of-the-art air cargo management system was developed in partnership with Hermes Logistics Technologies to meet Etihad Cargo’s specific requirements and provides a complete and integrated IT solution. The airline said in a statement that a key benefit of imple-

menting the new system is that it ensures customers are better informed through real-time shipment tracking across Etihad Cargo’s global network, with updates being automatically forwarded to them on a regular basis. The handling and tracking of cargo shipments across the hub in Abu Dhabi is also enhanced and has become more efficient, with hand-held terminals being used to identify, track and verify all shipment details.

Air France-KLM to suspend Chennai service

ir France-KLM-Martinair cargo is suspending its thrice a week cargo service to Chennai from April 1, 2015. The service connects Hong Kong-Chennai-Mumbai-Amsterdam Schipol. The suspension is in line with the changing global airfreight market to further rationalise the capacity offer, the airline said in a trade notice. The freighter that is to be suspended offers good connections from Chennai to Mexico/African/ South American destinations that are new focus areas for Indian exports. The airline carries cargo such as automobile spare parts and garments, sources said to a daily. Meanwhile, the airline will

continue to serve customers by carrying cargo in passenger flights. Air France KLM operates 14 flights a week from Delhi, seven flights a week from Mumbai and six weekly flights from Bengaluru. Air France-KLM-Martinair Cargo is the dedicated air cargo business of the Air France KLM Group. Single-window clearance: The Customs Department in Chennai airport is planning to implement a single-window clearance for cargo, following the recent announcement by the government. Chief Commissioner of Customs S Ramesh said that the department was working with several others to get the work done.

Delhi International Airport (P) Ltd (Dial), a subsidiary of GMR Infrastructure Ltd, which runs Indira Gandhi International Airport, has entered into a definitive agreement to sell its entire 26 per cent stake in Delhi Cargo Service Centre Pvt. Ltd, which operates cargo operations at the airport to IDFC Alternatives, according to a stock market disclosure. The stake would be picked by India Infrastructure Fund-II for `28.60 crore (about $4.6 million). Delhi Cargo Service Center is a joint venture between Cargo Service Center India Pvt. Ltd and Dial, with Cargo Service Center holding 74 per cent equity (with complete management and operational control) and Dial the balance holding 26 per cent.

ANOTHER STRONG YEAR FOR HACTL Hong Kong Air Cargo Terminals Limited (HACTL) ended 2014 with its strongest quarter of the year, handling 491,476 tonnes (up 4.9 per cent on the same period of 2013). The last quarter was also the best of the year for exports, which totalled 287,456 tonnes (up 4.2 per cent on 2013), for imports, which totalled 131,202 tonnes (up 7.7 per cent) and for mail and express, which totalled 41,558 tonnes (down 2.2 per cent). Transshipments totalled 31,261 tonnes (up 11.1 per cent, but only the third highest quarter of 2014). For the year as a whole, HACTL’s total tonnage handled was up 8.7 per cent at 1,814,726 tonnes. Exports increased by 6.7 per cent to 1,035,899 tonnes, imports were up 10.3 per cent to 498,338 tonnes, transshipments were up 28.6 per cent at 130,834 tonnes, and mail/express traffic grew 3.1 per cent to 149,655 tonnes.

Cargo & Logistics I February 2015

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SHIPPING AND PORTS  APSEZ POSTS GROWTH IN Q3 NET PROFIT Adani Ports and Special Economic Zone

Ltd (APSEZ) posted a 13.66 per cent rise in its consolidated net profit for the third quarter ended December 31, 2014. APSEZ posted a net profit of `512.08 crore for Q3 of fiscal 2014-15 as compared to `450.51 crore for the corresponding period last year. Consolidated total income of the company grew by 37.62 per cent to stand at `1701.13 crore for the said quarter as against `1236.04 crore of the corresponding period last fiscal. Commenting on the results, Gautam Adani, Chairman, Adani Group said, “We are pleased that our performance across all ports continues to be robust therefore reflecting the strength of our Pan India strategy.”

VOC PORT CREATES NEW RECORD The V O Chidambaranar (VOC) Port Trust has created a new record by handling 1,47,124 Million Tonnes (mt) of cargo in a single day on February 14, 2015. Major cargoes that contributed to the achievement are industrial coal, thermal coal, containers, rock phosphate and furnace oil, apart from general cargo. Port trust surpassed its previous best of 1,39,610 mt on August 31, 2013. S. Anantha Chandra Bose, Chairman, VOC Port Trust, thanked all the stakeholders, officers and employees of the Port who have contributed towards achieving this record. “VOC Port is continuously striving to achieve improvement in performance and productivity in order to attract more volume of traffic,” he said. The Chairman also appealed for continued support to achieve the same level of performance in future, to reach the Ministry of Shipping’s overall cargo

February 2015 I Cargo & Logistics

Vizag-Dubai container service launched

hreyas Shipping & Logistics Ltd, of Transworld group of companies and a leading Indian coastal container shipping line, recently launched a direct service from Vizag to Jebel Ali (Dubai) with the maiden call of SSL Gujarat at the Visakha Container terminal. The ship is the new acquisition in the company’s fleet and directly deployed on PIX2 (Pan India X-press) service on rotation: Jebel Ali-Mundra-Kattupalli-Vizag-Tuticorin-Cochin-Jebel Ali. “The exim cargo for Gulf countries presently being transhipped at Colombo will get transhipped at Vizag and shipped out directly from here,” said

Capt V K Singh, CEO of Shreyas Shipping & Logistics Ltd. “The service would cater to the movement of domestic containers between Indian ports, coastal Exim transhipment containers and direct liner cargoes to and from Gulf countries,” he added. The service has commenced with two vessels on a fortnightly basis and very soon one more vessel will be inducted to provide faster frequency.

GE SHIPPING TO SELL LARGE CARGO SHIP

reat Eastern Shipping Company Ltd (GE Shipping) recently signed a contract to sell a 1996-built capesize dry bulk carrier Jag Arjun by this March-end. “The vessel will be delivered to the buyers during the fourth quarter (January-March) of the current fiscal,” the company said in a statement. Capesize dry bulk carriers, the largest cargo ships plying in international waters, are mainly used to transport coal, ores and other commodity material. The company’s current fleet stands at 30 vessels comprising 21 tankers (8 crude carriers 12 product tankers 1 LPG carriers) and 9 dry bulk carriers (1 Capesize 3 Kamsarmax 5 Supramax) with an average age of 10 years aggregating 2.42 mn dwt. The current order book comprises 5 bulk carriers and one product tanker. Meanwhile, company recorded 79 per cent jump in its consolidated third quarter net profit at `181.7 crore against `101.5 crore, in a year ago period. The company’s total income was up 12.1 per cent at `877.8 crore versus `782.8 crore. However, the company’s EBITDA was down 2.9 per cent at `340 crore versus `350 crore.

DHL launches LCL service

HL Global Forwarding, the air and ocean freight specialist within Deutsche Post DHL, is launching a new weekly direct service for groupage containers between India and Germany. The new service will reduce the transit time for LCL (less than container load) transports from Tuticorin, India, to Hamburg from 33 to 26 days. “Germany is India’s number-one EU trade partner. The launch of this new LCL route connecting Tuticorin to Hamburg will further facilitate foreign trade between the two countries and support the growing needs of small and medium enterprises. This will be particularly beneficial to companies in the textile, chemical, metal, leather and electronics sec-

NEWS IN BRIEF

VPT to raise cargo handling capacity

SHIPPING AND PORTS  traffic target of 32 mt and container traffic target of 5.47 lakh TEUs set for FY15.

ICTT KOCHI TO REDUCE FREE PERIOD International Container Transshipment Terminal (ICTT) in Kochi is planning to reduce the free period for cargo-laden containers. Under the proposal, the average free period is expected to be reduced to three days from the present

isakhapatnam Port Trust (VPT) is planning for expansion and modernisation with a investment of `30 billon. While the port authority will spend 25 per cent of the total planned investment, the rest 75 per cent is likely to be funded by private partners through Public-Private Partnerships (PPP), according to reports of a daily. Once operational, the facility is likely to add to the port’s capacity by almost 50 per cent. The port intends to raise its existing 85 million tonne cargo handling capac-

tors, who will benefit from the reduced transit time of our new service.” said Samar Nath, CEO, DHL Global Forwarding India.

ity to 125 million tonne in order to become the third largest Indian port within three years. The investment will be used for modernisation of cargo handling infrastructure at the port, which will include dredging works to facilitate large vessels with 100,000 tonne of cargo.

BAY TERMINAL AT CPA

n order to mobilise port activities and reduce transportation cost Chittagong Port Authority (CPA) is going to set up a new terminal on the Patenga coastline with all modern port facilities. The proposed Bay Terminal to be built on an area of 900 acres would allow big ships, which now cannot anchor at the Chittagong Port, to berth for carrying out shipment activities, CPA sources said. The CPA will finance, control and supervise the Bay Terminal to be built on the coastline behind the Chittagong Export Processing Zone (CEPZ). The shipping ministry has already approved the project while the Chittagong district administration approved acquisition of 900 acres of land for this purpose, the sources said adding that the country’s premier sea port, Chittagong Port, handles over 1.6 million TEUs (twenty equivalent units) of containers side by side with handling 15.0 million of cement clinkers and a huge quantity of coal and open cargoes annually.

seven days, starting from April 1, 2015. To execute the plan as a first step towards this, DP World had written a letter to the Tariff Authority for Major Ports (TAMP) seeking reduction of free time at the port. In the letter, India Gateway Terminal Private Limited, the Indian arm of DP World, had cited two issues for this — congestion at the terminal yard and a recommendation from the department of Customs. The letter stated the present infrastructure at the terminal had been designed to handle volumes of up to one million TEUs (twenty-foot equivalent units of standard-size container) with a certain expected mix of transshipment containers.

VISAKHAPATNAM PORT CARGO UP Visakhapatnam port registered an increase in cargo handling by about half a million tonnes (mt) during the April-January period compared with the corresponding period last year owing to an abnormal hike in steam coal imports. During last fiscal April-January period, the port handled 47.8 Million Tonne (mt) cargo, whereas this year, it increased to 48.3 mt. However, iron ore declined to 7.2 mt as compared with 10.2 mt last year.

Cargo & Logistics I February 2015

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LAND  FREIGHT TRAFFIC INCREASE FOR RAILWAYS

The Indian Railways recently reported an increase of 4.64 per cent in freight carried during April-January, 2015. According to the railways, it carried 906.36 million tonnes of freight in the period under review as compared to 866.14 million tonnes ferried during the corresponding period of last fiscal. The railways further said that its revenue generated from ferrying freight increased by 12.43 per cent in the period under review and stood at `86,009.27 crore from `76,501.01 crore earned during the corresponding period of last fiscal. The railways had transported 97.79 million tonnes of cargo during the month under review.

New panel to review freight growth: The Railway Ministry has set up an eight-member panel headed by the Additional Member of the Railway Board, Mohd Jamshed, to review its track record on the freight and passenger traffic fronts, the Ministry said. The main function of the committee, which would also have officials from the Dedicated Freight Corridor Corporation (DFCC), Container Corporation of India (CONCOR), Zonal Railways and the Railway Board, would be to identify factors and issues affecting the growth of freight and passenger traffic and suggest a plan of action for traffic optimisation in the short term by 2015-16, and long term by 2018-19.

125 ROAD TOLL PLAZAS TO BE SCRAPPED The Central Government is planning to scrap 125 toll plazas across some of the country’s roads where the cost has been recovered, or toll collections

February 2015 I Cargo & Logistics

DB Schenker opens logistics centre in Patna

chenker India Pvt. Ltd, a part of DB Schenker, the transport and logistics division of Deutsche Bahn Group, announced the opening of its DB Schenker Logistics Centre (SLC) in Patna, Bihar. With a starting capacity of 10,600 square feet, the SLC would be providing DB Schenker customers with logistics and warehousing solutions with last-mile delivery and value added services to the industries involved in home appliances, electronics, computer peripherals and hitech segments. The facility has scalability options to cater for future growth in the region for the next 3-5 years. With its proprietary Warehouse Management System (WMS), the DB Schenker Logistics Centre in Patna would provide customers many benefits, including the analysis of product supply, forecast and demand fulfillment, real-time data input, interface capabilities, web order placing, and other customised functions.

Shrichand Chimnani, Director Logistics, said about the new centre, “The opening of the DB Schenker Logistics Centre in Patna is part of our corporate strategy to bolster our presence in the eastern region, that enables us to serve the industries more effectively in Bihar, Jharkhand and neighbouring parts of West Bengal, as well as Uttar Pradesh, which are witnessing rapid economic growth. The warehouse is strategically located close to Transport Nagar, making movement of goods for industries even easier and cost effective. This state-ofthe-art facility is well positioned to cater to the rising awareness and an increase in demand, for quality integrated logistics solutions in the eastern part of India.” Logistics partner to Mercedes: DB Schenker Logistics has been awarded the contract by the Mercedes AMG Petronas Formula One Team to provide its Europe-wide logistics services for Formula one. A corresponding four-year contract valid until December 31, 2018 was signed recenlty at the team’s headquarters in Brackley, UK. The services cover logistics services at all European races, tests and promotional events, including transport and construction of the motor home, transportation of racing vehicles and spare parts, and construction of engineering offices.

Amazon may buy stake in Blue Dart

S-based company Amazon is in talks to acquire 75 per cent stake in Blue Dart for a deal amount of USD 2 billion. The move is expected to improve the logistics service of Amazon. As per a report in a daily, the talks are currently at an early stage and if the deal goes through then it will help Amazon to expand its overall customer reach, boost its delivery services and provide an edge over its competitors Flipkart and Snapdeal. Blue Dart has a domestic network covering over 34,248 locations, and services more than 220 countries. The firm

has warehouses at 72 locations across the country along with bonded warehouses at 7 metros including Ahmedabad, Bengaluru, Chennai, Delhi, Mumbai, Kolkata and Hyderabad.

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FIAMM chooses CEVA for distribution in Italy C EVA Logistics and FIAMM, manufacturer of batteries and horns for automotive and industrial use, have announced a two year agreement for the distribution of goods throughout Italy. FIAMM has appointed CEVA to manage the distribution in Italy of three product groups: standby batteries, starter batteries and horns. CEVA will be responsible for the picking of products at FIAMM’s warehouses in Almisano, in the province of Vicenza, and Veronella, in the province of Verona; it will also undertake deliveries to end customers. Under the new agreement, CEVA will handle around 19,000 shipments totaling some 43 million kilos per year. “We decided to entrust the supply chain management to a single and reliable partner in order to gain direct benefits in terms of simplification, efficiency and support our planned growth.” Through the deep expertise developed by CEVA in our sector, FIAMM can now achieve concrete benefits in improved flexibility and cost reduction, while helping to guarantee our customers high quality products and service,” said Eddy Danuso, Supply Chain and Purchasing

Manager, FIAMM.

CEVA to manage Xiaomi’s distribution: CEVA Logistics has won a new contract with Xiaomi to operate their warehouse and distribution in Malaysia. Under the terms of this contract, CEVA will manage the 1,500 square meter e-commerce distribution centre which holds Xiaomi’s handsets and accessories. CEVA’s services include receiving, checking, storage, orders picking process, packaging and orchestrating all shipping and administration across the country. Hugo Barra, Xiaomi’s Vice President, Global, said: “We are confident that CEVA, through its warehouse and logistics solutions, will help Xiaomi continue to provide an excellent online buying experience in Malaysia.”

FedEx upgrades fleet in India

edEx Express recently announced its ground fleet expansion plan in India, which will further increase capacity and efficiency in the FedEx domestic ground distribution network. Over the next two years, FedEx will add more than 350 new vehicles to its fleet in a phased manner. This expansion is in line with the company’s plans announced earlier in the year, to strengthen its domestic transportation and supply chain capabilities. With a cargo capacity ranging between 2.5 and 15 tonnes, the light and heavy vehicles procured from BharatBenz and Tata Motors will operate on dedicated routes across the country. The vehicles are equipped with Global Positioning System (GPS) devices, cage

palletising systems and reverse cameras. These superior features, including the cage sort systems, will ensure higher safety of shipments.

LAND 

have become unviable. The Union Minister of Road Transport and Highways, Nitin Gadkari, said around 74 such public-funded tolls have been identified, of which 61 have been shut down. “All projects with an investment of less than `100 crore under public-private partnership are likely to be made toll-free after addressing contractual obligations,” the Minister said.

DHL LAUNCHES NEXT PHASE RESILIENCE 360 DHL recently announced that it is adding enhanced new capabilities to its industry-leading risk management solution, Resilience360. Resilience360, the first of its kind in the industry which was launched last year, is an end-to-end supply chain risk management platform that alerts customers about global incidents and risks to their global supply chain in almost real time - enabling customers to maintain an advantage over their competitors by immediately responding to incidents and pre-empting or minimising business interruption. Since its launch, Resilience360 has been used by customers across Asia, Europe and the Americas. The largest uptake has been in the automotive industry, followed closely by chemicals, life sciences and the technology sector. Tobias Larsson, Head of DHL Resilience Team, DHL Customer Solutions & Innovation, said, “Corporate supply chain organisations are siloed, operate on a regional basis, and are disconnected among regions and even sites. As a result, they lack visibility and span of control beyond their part of the operation. That may work day to day, but when you’re in crisis, it can be a problem.”

Cargo & Logistics I February 2015

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INFRASTRUCTURE 

New airport in Gujarat

GOVT EYES FOREIGN FUNDS FOR INFRA PROJECTS

In order to boost the infrastructure project worth over $75 billion in sectors like power, roads and railways, the Union Government is seeking foreign funds. This includes highway projects worth $6 billion to be implemented in the next few years. “As many as 26 projects worth $3.6 billion are in final preparation stages before implementation, 9 are ready to be bid out and 16 are at various stages of the bidding process,” according to a Department of Industrial Promotion and Policy paper, Investment Opportunities in India. “The value of roadways and bridge infrastructure in India is expected to grow at a Compound Annual Growth Rate (CAGR) of 17.4 per cent between 2012-17 and is to reach $10 billion. “There has been an unprecedented increase in cargo handling capacity from 575 Million Metric Tonnes (MMT) in 2009 to 800 MMT in February 2014. As part of the government’s efforts to actively focus on development and upgradation of capacities across all coastal states projects in shipping for the next few years worth $9 billion will be implemented,” the paper added.

JNPT TO BUILD SATELLITE PORT Jawaharlal Nehru Port Trust (JNPT) is planning to build a satellite port at either Vijaydurg or Dahanu in Maharashtra for at least `10,000 crore. JNPT and the Maharashtra government will hold 75 per cent and 25 per cent respectively in the proposed project, NN Kumar, Chairman of JNPT said in an interview adding that at both Vijaydurg and Dahanu, there is natural draught of 20 metres to receive bigger ships. A feasibility

February 2015 I Cargo & Logistics

new international airport has been planned in Gujarat to handle the air traffic from the Middle Eastern hubs. “The new airport in Dholera, about 100 kilometers (62 miles) from Ahmedabad, will be capable of handling Airbus A380 superjumbos,” said Amit Chavda, General Manager for Dholera International Airport Co. The Dholera airport, to be built in about 1,426 hectares of land at an initial investment of `10 billion ru-

pees ($1.6 billion), will have two runways, hotels and convention centers. “The new airport will attract foreign airlines by offering them an alternative hub to Dubai, Abu Dhabi and other Middle Eastern airports. A flight from London to Sydney can save fuel for more than 300 kilometers by using Dholera as a hub instead of Dubai. The Dholera airport, for which the Japan International Cooperation Agency is preparing a project survey, has initial approval from the Ministry of Civil Aviation and expects to get other approvals by 2016,” Chavda said adding that the bids will be invited from private companies to develop the airport.

Fresh tender for pre-development work

he tenders for pre-development work on the land site of the Navi Mumbai International Airport will be re-invited by the City and Industrial Development Corporation (CIDCO). After bidders raised certain issues regarding the tender conditions with CIDCO, the agency modified the conditions, including aspects like eligibility criteria. Accordingly, CIDCO will now be re-inviting tenders which will tentatively be opened on May 20, 2015. The total cost of the pre-development works is expected to be around `1,750 crores which includes reclamation of marsh land, increasing the level of land up to 5.5 metres, flattening of hillocks that is levelling and cutting them and bringing the hillocks to a level of 8 metres from 92 metres, besides diversion

of the Ulwe River. The pre-development work will be funded by CIDCO and once the contract for development of the airport project is awarded, the developer will take over the pre-development works on as it is basis. “Since modifications were done to the tender conditions, we will be re-inviting the tenders to ensure transparency,” said Sanjay Bhatia, MD, CIDCO.

NEWS IN BRIEF

India to roll out smart city ports

INFRASTRUCTURE  study for a satellite port has been completed internally. At present, there is only one big port in Maharashtra-JNPT-despite the fact that there is large industrial growth taking place in the state. JNPT’s proposal comes at a time when the growth of the Indian economy is projected to touch 7.4 per cent in the current fiscal year compared with 6.9 per cent last year based on a new way of calculating Gross Domestic Product (GDP).

4 AIRPORTS TO BE MODERNISED

HUGE ADVANTAGE: The Union Minister for Road Transport & Highways and Shipping, Nitin Gadkari and the Secretary, Ministry of Road Transport and Highways, Vijay Chibber addressing a meeting

he Central Government is working on an ambitious plan to build one smart city each at the country’s 12 major ports. The plan estimates total investment of `50,000 crore ($8 billion), Indian Shipping Minister Nitin Gadkari has said. The 12 major ports under the Centre’s control have between them an estimated 2.64 lakh acres of land, which is being mapped through satellites and are major resources with Shipping Ministry. Each city will be

built with an expenditure of about `3,0004,000 crore. These will be green smart cities. The government is trying to start work on these in four to six months and expected to complete in five years. The 12 major ports in the country Kandla, Mumbai, JNPT, Marmugao, New Managlore, Cochin, Chennai, Ennore, V O Chidambarnar, Visakhapatnam, Paradip and Kolkata (including Haldia) handle approximately 61 per cent of cargo traffic.

Srikakulam port project kick-started

he Andhra Pradesh (AP) Government has kick started the process of developing the long pending Bhavan-apadu Greenfield sea port project in Srikakulam. An Expression of Interest was issued by the Infrastructure Corporation of AP for developing the port on a Design-Build-Finance-Operate-Transfer basis on a public-private-partnership model. The port will handle cargo from in and out of Vizianagaram and Srikakulam districts of AP along with mineral rich states of Jharkhand, Chhattisgarh,

South Odisha and Madhya Pradesh. The net worth of the applicant, according to the corporation was decided as `800 crore. The state, besides the major port of Visakha Port Trust as Visakhapatnam, has identified 14 non-major port locations for development that are administered by the Director of Ports of AP. The state’s coastline contributes to approximately 12 per cent of the India’s cargo throughput added to approximately 60 million tonnes of cargo handled by Vishakhapatnam Major Port.

The Central Government is planning to modernise airports at Chennai, Kolkata, Jaipur and Ahmedabad. The Centre plans to hand over the project to private sector for the modernisation work of these four airports, which are now run by the Airports Authority of India (AAI). Nine firms, including GMR Airports, the GVK Group, Tata Realty, and Adani Ports, have shown interest in the project. The others interested are Essel, Siemens Postal Parcel and Airport Logistics Private Limited, International Business Development Flughafen (Zurich), Flemingo Duty Free Shop Private Limited, and Cochin International Airport. At the first pre-bid meeting held recently, the representatives of some of these companies wanted the 30-year concession period extended. The deadline set for companies to put in their bids is end March.

JNPT AND KPT TO BUILD PORTS OVERSEAS Jawaharlal Nehru Port Trust (JNPT) and Kandla Port Trust (KPT) got the Central Government nod to go ahead and build and operate ports overseas. A new company, India Ports Global Ltd (IPG), will be jointly held by the two ports with the board comprising three members: Chairman of JNPT, Chairman of KPT and an additional Secretary from the Central Government. The present paid-up capital of IPG is `5 crore. Its first project will be development and operation of a port at Chabahar in Iran. Some other projects the newly formed IPG will be looking at are building ports in Bangladesh, Myanmar and Sri Lanka.

Cargo & Logistics I February 2015

PRODUCT

Augmented Reality in Logistics

New technologies impact almost every industry, and logistics is no exception. The next big wave of change in the logistics industry might just come in the form of Augmented Reality technology. DHL successfully tested the application in a warehouse

rom science fiction to real-life industry applications, Augmented Reality harnesses the potential to improve our real environment by overlaying context specific computer-generated information to our line of sight. Although still in its early years, Augmented Reality could eventually empower everything ranging from our everyday purchasing decisions, to vehicle repairs and in logistics, picking by vision in warehouses. The next big wave of change in the logistics industry might just come in the form of Augmented Reality technology.

HL is looking to explore the economic feasibility of smart glasses and Augmented Reality beyond warehouse applications. DHL has successfully carried out a pilot project testing smart glasses and Augmented Reality in a warehouse in the Netherlands. In cooperation with DHL customer Ricoh and wearable computing solutions expert Ubimax, the technology was used to implement ‘Vision Picking’ in warehousing operations. Staff was guided through the warehouse by graphics displayed on the smart glass to speed up the picking process and reduce errors. The testing proved that augmented reality offers added value to logistics and resulted in a 25 per cent efficiency increase during the picking process.

“V

ision picking enables hands free order picking and greatly increases productivity. The technology significantly supports our staff and brings exciting value to our customers. However, this is just the first step in our innovation journey as we believe augmented reality will become relevant for even more supply chain areas,” said Jan-Willem De Jong, Business Unit Director Technology, DHL Supply Chain Benelux. The tests objective was to gain insights on the technology’s benefits and limitations. For three weeks, warehouse staff in Bergen op Zoom was equipped with head mounted displays such as Google Glass and VuzixM100. The displays showed the respective task information during the picking process, including aisle, product location and quantity. Overall, 10 order pickers used the equipment and picked more than 20,000 items, fulfilling 9,000 orders within the given time frame. As a result, staff was able to operate much faster and error free. Currently, DHL and Ricoh are jointly evaluating the roll-out of the solution.

“We are always looking to further improve our processes with new technologies and we were happy to have DHL as our innovation partner for the pilot project,” said Pieter-Jelle van Dijk, Director Operations, Ricoh EMEA. In June 2014, DHL’s Trend Research team issued a trend report called “Augmented Reality in Logistics”, which describes best practices and promising use cases. In addition to vision picking in warehousing operations, the report also illustrates how operations during transportation, last mile delivery and value-added services could be improved by augmented reality applications. For the near future, DHL is looking forward to explore the economic feasibility of augmented reality in additional areas and is open for collaboration with further partners.

February 2015 I Cargo & Logistics

PRODUCT

Wind power to the rescue

Taking notes on the world’s attempts to go green, the shipping industry has created a potential alternative-energy ship design called “Vindskip” which uses “air-foil” technology

hipping is an important component of freight transportation. This mode of transport, however, accounts for three per cent of the world’s greenhouse gases, according to a study by the European Commission. This is about a billion tonnes of emissions a year, twice the carbon footprint of aviation. The world is attempting to go green and the shipping industry is also committed to it. Lade AS, a Norwegian design company is hoping to revolutionise green shipping with a new design for a ship “Vindskip” whose huge hull will act like a sail. Vindskip is a hybrid merchant vessel for sustainable sea transport, driven by the wind and Liquefied Natural Gas (LNG) and could potentially achieve up to 60 per cent of fuel savings and reduce emissions by up to 80 per cent, claims the company. The company is also confident that the first Vindskips will set sail by 2019. Vindskip uses a concept of Wind Power System. A vessel with a hull shaped like a symmetrical air foil going in the relative wind, will generate an aerodynamic lift giving a pull in the ships direction, within an angular sector of the course. With an LNG propulsion system in addition, starting the ship from zero up to the desired speed, the aerodynamic lift generated can be exploited to generate pull and thus saving fuel: Forming a dynamic system that maintains a constant speed of the ship. The contribution of the ship’s Wind Power System to the actual propulsion of the ship will vary over time. A Cruise Control will be installed balancing the LNG propulsion system making it work as a dynamic entity together with the Wind Power System, keeping a constant speed of the ship. By firstly adjusting the pitch on the propeller and then the Revolutions per minute (rpm) if necessary, it will make it possible to keep a constant speed and saving fuel. Vindskip also uses computerised weighting of meteorological data, a computer program

February 2015 I Cargo & Logistics

calculating the best route. Specially developed navigation algorithms, will give the optimum wind angles for maximum effect of the design. The alternative-energy design of the Vindskip comes at an important time,

with changes to international regulations in sulphur content of marine heavy fuels, capping the sulphur content from 3.5 per cent to 0.5 per cent by 2020. This will not only cause bunker fuel costs to rise, but engine-cleaning costs.

CMA CGM to introduce smart containers

MA CGM will start smart containers this year, offering its clients unique follow up solutions and real time data collecting from all over the world. The technology is being developed with a start-up company which would enable data on the location and condition of the container to be monitored at all times throughout a delivery as the boxes will be equipped with new sensors at all times. CMA CGM said it had contributed to the capital increase of French firm Traxens. Two other investment funds — CAAP Création, part of Crédit Agricole Group, and SCR Provençale et Corse of the BPPC Group — are also part of the initiative. “This capital increase will be dedicated to financing new research and development programmes, as well as industrialisation,” said CMA CGM.

“With this technology, CMA CGM brings the shipping industry into a new era. In a world where information is key, we are taking a significant step ahead. We will now be able to collect data in real-time, which is equally important to us and to our clients. Containers are becoming connected devices,” said Elie Zeenny, Senior Vice-President, Group IT Systems, CMA CGM. “We are very grateful to CMA CGM for supporting us and bringing their expertise from the very beginning of the Traxens adventure. It allowed us to develop a high-valued and unique solution that is attractive to all transport companies and to reunite a group of solid and active shareholders which includes the investment arms of large national banks,” said Michel Fallah, Founder and President, Traxens.

STATS

TRAFFIC TRAFFICHANDLED HANDLEDAT ATMAJOR MAJOR PORTS PORTS (DURING APRIL TO JANUARY, 2015* VIS-A-VIS APRIL TO JANUARY, 2014)

(*) TENTATIVE

(IN ' 000 TONNES)

PORTS

APRIL TO JANUARY

% VARIATION

TRAFFIC

AGAINST PREV.

2015* 2

1 KOLKATA Kolkata Dock System

2014 3

YEAR TRAFFIC 4

11844

10308

14.90

Haldia Dock Complex

24723

23685

TOTAL: KOLKATA

36567

33993

4.38 7.57

PARADIP

58879

56658

3.92

VISAKHAPATNAM

48377

47897

1.00

KAMARAJAR (ENNORE)

25146

22458

11.97

CHENNAI

44451

42113

5.55

V.O. CHIDAMBARANAR

25744

23472

9.68

COCHIN

18022

17473

3.14

NEW MANGALORE

30409

32653

-6.87

MORMUGAO

11680

9522

22.66

MUMBAI

51570

49063

5.11

JNPT

53273

51595

3.25

KANDLA

78294

73219

6.93

482412

460116

4.85

TOTAL:

Source:INDIAN PORTS ASSOCIATION

Cargo and Logistics

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STATS

INDIAN PORTS ASSOCIATION

TRAFFIC HANDLED AT MAJOR PORTS TRAFFIC HANDLED AT MAJOR PORTS

(DURING APRIL TOJANUARY'2015* JANUARY’2015* APRIL TO JANUARY’2014) (DURING APRIL TO VIS-A-VISVIS-A-VIS APRIL TO JANUARY'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-JAN.'2015

501

107

6798

442

4248

11844

TRF APRIL-JAN.'2014

569

124

212

5931

380

3468

10308

TRF APRIL-JAN.'2015

4323

2083

252

386

962

4691

1482

10544

24723

TRF APRIL-JAN.'2014

4933

1787

194

289

1355

4542

1839

8746

23685

TRF APRIL-JAN.'2015

4824

2190

329

468

962

4722

8280

535

14792

36567

TRF APRIL-JAN.'2014

5502

1911

198

289

1355

4754

7770

476

12214

33993

TRF APRIL-JAN.'2015

14655

1744

3670

25135

6527

7042

58879

TRF APRIL-JAN.'2014

15075

4558

122

3327

20809

5812

6879

56658

TRF APRIL-JAN.'2015

12133

7215

1472

620

2052

4799

3621

206

16465

48377

TRF APRIL-JAN.'2014

11550 10232

1670

625

2416

5736

4154

221

11514

47897

KAMARAJAR(ENNORE) TRF APRIL-JAN.'2015

2592

20053

330

2171

25146

TRF APRIL-JAN.'2014

1858

18192

355

2053

22458

TRF APRIL-JAN.'2015

10874

146

197

306

25152

1304

7776

44451

TRF APRIL-JAN.'2014

10405

160

244

23738

1230

7505

42113

TRF APRIL-JAN.'2015

486

394

823

6837

8828

450

8330

25744

TRF APRIL-JAN.'2014

391

388

557

5514

8181

413

8441

23472

TRF APRIL-JAN.'2015

11642

320

4444

310

1464

18022

TRF APRIL-JAN.'2014

12020

188

3997

291

1232

17473

TRF APRIL-JAN.'2015

18961

1382

532

2250

4647

747

1853

30409

TRF APRIL-JAN.'2014

20419

2787

405

2238

4558

589

1607

32653

TRF APRIL-JAN.'2015

478

466

176

1364

5270

219

3707

11680

TRF APRIL-JAN.'2014

437

174

6179

164

2568

9522

TRF APRIL-JAN.'2015

30151

142

224

3790

452

16811

51570

TRF APRIL-JAN.'2014

29789

147

3626

368

15059

49063

TRF APRIL-JAN.'2015

3413

47550

3719

2310

53273

TRF APRIL-JAN.'2014

3679

45616

3420

2300

51595

TRF APRIL-JAN.'2015

46937

726

3334

569

8230

184

18314

78294

TRF APRIL-JAN.'2014

43967

561

2336

701

5488

221

452

19493

73219

TRF APRIL-JAN.'2015 157146 13915

6681

7037

70771

26479

99348

6638 101035 482412

5636

6055

59638

27615

95105

6177

90865 460116

18.54

16.22

18.67

-4.11

4.46

7.46

11.19

CHENNAI

V.O.CHIDAMBARANAR

COCHIN

NEW MANGALORE

MORMUGAO

MUMBAI

J.N.P.T.

KANDLA

ALL PORTS

TRF APRIL-JAN.'2014 155092 20110 % Variation from previous year

1.32 -30.81

14.90

4.38

7.57

3.92

1.00

11.97

5.55

9.68

3.14

-6.87

22.66

5.11

3.25

6.93

4.85

Source:INDIAN PORTS ASSOCIATION

February 2015 I Cargo & Logistics

STATS

INTERNATIONAL FREIGHT INTERNATIONAL FREIGHT AIRPORT

SL. NO.

ANNEXURE-IVA

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

For the month DECEMBER DECEMBER 2014 2013

(A) 18 INTERNATIONAL AIRPORTS 1

CHENNAI

17551

17541

0.1

168678

167401

KOLKATA

4089

3584

14.1

36583

33989

7.6

AHMEDABAD

1297

1128

15.0

13421

12038

11.5 -35.9

0.8

GOA

230

-57.0

900

1404

TRIVANDRUM

2839

3121

-9.0

21438

21107

1.6

CALICUT

1773

1640

8.1

16307

17086

-4.6

LUCKNOW

134

115

16.5

1044

848

23.1

GUWAHATI

-100.0

9.1

SRINAGAR

JAIPUR

93.5

477

174

174.1

BHUBANESWAR

395.6

MANGALORE

130.8

223

COIMBATORE

-24.7

687

734

-6.4

AMRITSAR

96.2

399

1307

-69.5

TRICHY

394

353

11.6

3445

0.0

VARANASI

PORTBLAIR

IMPHAL

0 28387

0 27876

0 259589

1.8

0 263614

1.6

TOTAL (B) 6 JV INTERNATIONAL AIRPORTS 19

DELHI (DIAL)

33764

31888

5.9

322178

290905

10.8

MUMBAI (MIAL)

42659

38730

10.1

363397

348561

4.3

BANGALORE (BIAL)

13463

12283

9.6

125112

112324

11.4

HYDERABAD (GHIAL)

4559

4486

1.6

40980

36941

10.9

COCHIN(CIAL)

3692

3215

14.8

47117

30977

52.1

NAGPUR (MIPL)

11.6

301

297

1.3

98185

90645

8.3

899085

820005

9.6

TOTAL (C) 7 CUSTOM AIRPORTS 25

PUNE

-100.0

VISAKHAPATNAM

PATNA

CHANDIGARH BAGDOGRA

MADURAI

0 0

0 1

-100.0

3 1

0 1

0.0

GAYA

29 30

TOTAL

(D) 17 DOMESTIC AIRPORTS

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

126572

118522

6.8

1162789

1079605

7.7

Source: AIRPORTS AUTHORITY OF INDIA

Cargo & Logistics I February 2015

STATS

DOMESTIC FREIGHT DOMESTIC FREIGHT SL. NO.

AIRPORT

For the month DECEMBER DECEMBER 2014 2013

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

ANNEXURE-IVB

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

7196 6892 3568 337 58 21 310 1033 397 354 486 33 686 12 0 51 362 386 22182

6108 7077 3274 294 119 10 307 670 251 682 382 17 440 18 0 29 320 333 20331

17.8 -2.6 9.0 14.6 -51.3 110.0 1.0 54.2 58.2 -48.1 27.2 94.1 55.9 -33.3 75.9 13.1 15.9 9.1

61081 68565 31741 2397 879 273 2571 7358 4854 1418 3879 275 5702 289 0 480 2278 3399 197439

53931 63166 26911 1902 1441 126 2262 5230 2888 5418 2909 221 4600 94 0 324 1960 3072 176455

13.3 8.5 17.9 26.0 -39.0 116.7 13.7 40.7 68.1 -73.8 33.3 24.4 24.0 207.4 48.1 16.2 10.6 11.9

23117 17379 9915 3888 919 525 55743

20016 15403 8061 3380 870 464 48194

15.5 12.8 23.0 15.0 5.6 13.1 15.7

201125 158922 86130 32589 8458 4352 491576

158256 136629 68697 27621 7096 3850 402149

27.1 16.3 25.4 18.0 19.2 13.0 22.2

2471 70 421 275 264 73 0 3574

2054 95 452 277 227 112 0 3217

20.3 -26.3 -6.9 -0.7 16.3 -34.8 11.1

20814 2571 3873 3499 2219 859 0 33835

514 16 351 401 213 316 94 4 73 124 5 14 1 0 23 2149 131 83779

463 153 302 454 205 208 96 0 62 91 0 12 1 0 17 2064 160 73966

11.0 -89.5 16.2 -11.7 3.9 51.9 -2.1 17.7 36.3 16.7 0.0 35.3 4.1 -18.1 13.3

4846 1181 3030 4609 1499 2500 962 18 695 986 28 98 9 0 212 20673 1129 744652

15619 1239 3435 2586 1526 923 025328 3344 1276 2403 5079 1530 1798 627 0 631 819 0 130 15 0 210 17862 1205 622999

33.3 107.5 12.8 35.3 45.4 -6.9 33.6 44.9 -7.4 26.1 -9.3 -2.0 39.0 53.4 10.1 20.4 -24.6 -40.0 1.0 15.7 -6.3 19.5

Source: AIRPORTS AUTHORITY OF INDIA

February 2015 I Cargo & Logistics

One of India’s leading Logistics and Transport Companies, VRL Logistics Ltd focuses on delivering high quality and cost effective service, with world-class reliability to its customers. Trusted by millions of Indians, VRL is committed towards customer satisfaction. VRL has been listed in the Limca Book of Records as the largest private sector owner of commercial vehicles. VRL is fully committed to accelerate your business to greater heights.

Now for our major expansion plans we need:

SENIOR EXECUTIVES Air Cargo Division  On Board Courier Service (OBC)  Priority Service  General Parcel 

LOCATION

AHMEDABAD, BENGALURU, CHENNAI, DELHI, HYDERABAD, KOLKATA, MUMBAI, PUNE.

Regd. Ofﬁce: 351/1, Varur Post Chowki, Taluk Hubli - 581 207 Corp Ofﬁce: Giriraj Annexe, Circuit House Road, Hubballi, 580 029 Karnataka Contact: 0836 - 2237511/514 web: www.vrlgroup.in email: vbs@vrllogistics.com CIN: U60210KA1983PLC005247

• 27 STATES • 4 UNION TERRITORIES • 628 CITIES • 981 BRANCHES & FRANCHISEES • 3868 VEHICLES (“This announcement is not being made in and may not be distributed or sent into United States, Canada, Australia or Japan. This announcement does not constitute, and may not be construed as, an offer or a solicitation for an offer to subscribe to or purchase any securities in India, United States or any other jurisdiction.”)

STATS

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

AIRPORT

For the month DECEMBER DECEMBER 2014 2013

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

NOTE:

ANNEXURE-IVC

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

24747 10981 4865 436 2897 1794 444 1033 397 414 486 63 756 63 394 51 362 386 50569

23649 10661 4402 524 3240 1650 422 671 251 713 382 30 533 44 353 29 320 333 48207

4.6 3.0 10.5 -16.8 -10.6 8.7 5.2 53.9 58.2 -41.9 27.2 110.0 41.8 43.2 11.6 75.9 13.1 15.9 4.9

229759 105148 45162 3297 22317 16580 3615 7370 4854 1895 3879 498 6389 688 3445 480 2278 3399 461053

221332 97155 38949 3306 22548 17212 3110 5241 2888 5592 2909 266 5334 1401 3445 324 1960 3072 436044

3.8 8.2 16.0 -0.3 -1.0 -3.7 16.2 40.6 68.1 -66.1 33.3 87.2 19.8 -50.9 0.0 48.1 16.2 10.6 5.7

56881 60038 23378 8447 4611 573 153928

51904 54133 20344 7866 4085 507 138839

9.6 10.9 14.9 7.4 12.9 13.0 10.9

523303 522319 211242 73569 55575 4653 1390661

449161 485190 181021 64562 38073 4147 1222154

16.5 7.7 16.7 14.0 46.0 12.2 13.8

2471 70 421 275 264 73 0 3574

2054 95 452 277 227 113 0 3218

20.3 -26.3 -6.9 -0.7 16.3 -35.4 #DIV/0! 11.1

20814 2571 3873 3499 2222 860 0 33839

15629 1239 3435 2586 1526 924 0 25339

33.2 107.5 12.8 35.3 45.6 -6.9 #DIV/0! 33.5

514 16 351 401 213 316 94 4 73 124 5 14 1 0 23 2149 131 210351

463 153 302 454 205 208 96 0 62 91 0 12 1 0 17 2064 160 192488

11.0 -89.5 16.2 -11.7 3.9 51.9 -2.1 #DIV/0! 17.7 36.3 #DIV/0! 16.7 0.0 #DIV/0! 35.3 4.1 -18.1 9.3

4846 1181 3030 4609 1499 2586 962 18 695 986 28 98 9 0 212 20759 1129 1907441

3344 1276 2403 5079 1530 1798 627 0 631 819 0 130 15 0 210 17862 1205 1702604

44.9 -7.4 26.1 -9.3 -2.0 43.8 53.4 #DIV/0! 10.1 20.4 #DIV/0! -24.6 -40.0 #DIV/0! 1.0 16.2 -6.3 12.0

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

February 2015 I Cargo & Logistics

EVENT

ACCD’s Annual Ball

he ACCD (Air Cargo Club of Delhi) Ball this year was held on January 10, 2015, at New Delhi. The large turnout of over 600 people from the cargo fraternity, stuck to partying indoors, enchanted by the comperes, talented TV actor Hussain Kuwajerwala and attractive IPL host Archana Vijaya. They were well supported by Australian DJ Catherine with the Aasma group and the Dancing Divas, grabbing much attention. Entertainment, fine food and drinks with camaraderie and bonhomie amongst peers are the mantras ACCD

has always followed to the hilt and here too the result was a massive success. This potent cocktail was enhanced by the announcement of over 35 lucky draws, international tickets sponsored by airlines and interesting hampers containing I-phones, LED TVs., etc. from Freight Forwarders and other members of the fraternity. Three interesting photo studios were available to couples to get their portraits clicked. The icing was the cake cutting ceremony by the managing committee, to commemorate 38 years of ACCD. Happy birthday ACCD!

AWARDS

AISATS Air India SATS Airport Services Pvt. Ltd. (AISATS) was conferred with the ‘Best Air Cargo Terminal Management Award’ for the fourth consecutive year by the Indian Chamber of Commerce at the Indian Supply Chain Logistics Summit & Excellence Award 2015. Mike Chew, SVP Delhi and Acting CEO of AISATS, accepted the award from Dinesh Rai, Chairman, Warehousing Development and Regulatory Authority (WDRA) in the presence of senior government officials, and eminent industry players.

SLCM Sohan Lal Commodity Management (SLCM) Pvt. Ltd. was conferred with Global CSR Excellence & Leadership Award for Fair Trade & Supply Chain. The award was received by the Group CEO Sandeep Sabharwal, who is the force behind the company. Senior key officials from different industries were present during the felicitation ceremony.

Blue Dart CSR

JBS conduct Customs training

BS Academy conducted a two day training programme at Adani Hazira Port Pvt Ltd along with Customs of Hazira Port. Almost all “H” Pass Holders attended the same with “G” Pass holders working in Hazira. The training programme covered various aspects of Customs Clearance from IGM, Bill of entry filing; Self Assessment, Classification, Valuation, Application of Allied Acts, Processing, Shipping bill filing, ICEGATE etc. It was an interactive programme conducted in Gujarati, Hindi, and English. Participants were given a hand out to facilitate continual handling. The

Blue Dart Express Limited presented the fourth Blue Dart World CSR Day and Global CSR Excellence & Leadership Awards. The awards applauding global corporate social responsibility and sustainability champions across various industries were given away by Yogesh Dhingra, Chief Financial Officer and Chief Operating Officer, Blue Dart Express.

FedEx programme also compared various initiatives at Hazira Container Terminal with other CFS and terminals in Western India. Notably the Gate management system and On Dock Exim Yard at Hazira Port, which operates through strong IT systems and is the best in its segment was highlighted.

FedEx Corp. is once again among the most admired companies in the world, according to a survey published in Fortune magazine. The annual “World’s Most Admired Companies” report released lists FedEx as the number 12 ranked company overall, and number one in the delivery industry.

Cargo & Logistics I February 2015

WOMEN IN CARGO

‘We connect…touch lives’ For someone who spent sometime in the Travel and Banking business before joining DHL, Jyoti Row Kavi comes across as a veteran. Head of Corporate Communications & Sustainability for DHL Global Forwarding and DHL Supply Chain, Kavi loves what she is doing and, of course, likes to speak about it Cargo is essentially a male-dominated industry. How did you find yourself in it? Having worked in the travel and banking sectors earlier, I thought it would be interesting to venture into a completely new industry, of which I had very little knowledge. Unlike a lot of my peers who are from the industry, it was all completely new to me, way more complex and interesting than I had imagined.

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

I’ve completed eight years with DHL and have enjoyed the ride. It’s been a great learning experience for me and that’s what makes it interesting. At first, I was overwhelmed with all the acronyms that were used in the forwarding industry, but got used to it as time went by.

How have your colleagues and those reporting to you reacted to you? My colleagues have always treated me like the professional that I am. I really don’t think it matters whether you’re a man or a woman, as long as you deliver a good job.

Do you specialise in any section of the industry: e.g. handling of dangerous goods, etc.? I head Corporate Communications & Responsibility for DHL Global Forwarding and DHL Supply Chain. My function involves overseeing all external and internal communications along with Corporate Social Responsibility.

What is so exciting about the cargo industry that keeps you attracted to it? This industry connects people, while improving and touching lives. From delivering critical medicines, automotive spares to working in sectors as diverse as retail, consumer, technology, energy and chemicals...we cover it all. That is fascinating to me.

How confident are you about future growth on equal opportunity basis with male colleagues? DHL consciously fosters diversity to create an inclusive culture. Through various programmes and initiatives, we strive to leverage and blend our vast diverse employee base into a winning team.

What advice would you give youngsters - especially women - to join the industry? Logistics being the very backbone of our economy, its potential is unimaginable. With the phenomenal development of e-commerce, coupled with the expected growth of other industries, logistics will play a significant role in the India story. It’s definitely the place to be in – if you’re prepared to work hard and reap the benefits of your efforts in a buoyant industry.

February 2015 I Cargo & Logistics

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RNI No. DELENG/2011/387546

Introducing Air Costa Cargo Air Costa has expanded its reach with the launch of Air Costa Cargo which caters to the domestic air cargo vertical by providing efficient air freight transportation across its stations. Air Costa Cargo is currently operational at Bengaluru, Coimbatore, Hyderabad, Vijayawada, Visakhapatnam and Tirupati in the South along with Ahmedabad and Jaipur in the West and the North respectively. Customers can book cargo through our offices or through our authorized agents.

Ahmedabad

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