Com­mon Cri­sis: Agents seek friendly pol­icy

agents seek friendly pol­icy

Cargo Talk - - Contents -

The writ­ing on the wall is clear and loud. The fu­ture of thou­sands of cargo agents in In­dia is at a stake. Cargo agents, es­pe­cially the small and medium ones are wor­ried about their sur­vival be­cause of sev­eral ad­ver­si­ties. Apart from a long pend­ing is­sue re­lated to CASS (Cargo Ac­count Set­tle­ment Sys­tem), the agents are fac­ing sev­eral other is­sues. In this first part of the ar­ti­cle Car­gotalk spoke to SL Sharma, Vice Pres­i­dent, ACAAI, to know more about present chal­lenges.

In­dus­try in­sid­ers say, for thou­sands of In­dian cargo agents it would be a dif­fi­cult task to meet CASS re­quire­ments in par­tic­u­lar. Mak­ing pay­ment for all air­lines, to be cred­ited by the agents at a time and by a sin­gle cheque, would prove to be a death nail for many of them. Is the CASS cri­sis invit­ing a chaos in the air cargo ex­port im­port sec­tor?

Sharma, how­ever, put the mat­ter from a dif­fer­ent per­spec­tive. “The Air Cargo Agents As­so­ci­a­tion of In­dia (ACAAI) is not against CASS as long as it is un­der the um­brella of In­dian Air Cargo Pro­gramme (IACP),” clar­i­fied Sharma.

IATA’s Cargo Ac­count Set­tle­ment Sys­tems (CASS) is de­signed to sim­plify the billing and set­tling of ac­counts be­tween air­lines and freight for­warders. It op­er­ates through CASSlink, an ad­vanced global web-en­abled e-billing so­lu­tion.

At the end of 2012, CASS was utilised in 82 ex­port op­er­a­tions, 10 im­port op­er­a­tions, 3 do­mes­tic op­er­a­tions, and one courier op­er­a­tion, col­lec­tively serv­ing over 500 air­lines, GSSAs and Ground Han­dling Com­pa­nies and set­tling a com­bined US$33 bil­lion. CASS is aimed to pro­vide two ma­jor ad­van­tages: it yields a two-fold so­lu­tion as it re­places air­lines’ tra­di­tional pa­per based in­voic­ing and agents’ man­ual con­trol­ling of those in­voices. In ad­di­tion, all will ben­e­fit from stream­lined in­voic­ing and col­lec­tion of sales rev­enue pro­cesses, with a neu­tral set­tle­ment of­fice. It will also en­hance fi­nan­cial con­trol and im­proved cash flow as the CASS rate of suc­cess in col­lect­ing funds is vir­tu­ally 100 per cent.

dif­fer­ent sce­nario in In­dia

In­dian air cargo in­dus­try is hith­erto chal­lenged by a mul­ti­ple fac­tors, and hence com­pletely un­pre­dictable. The coun­try’s present air cargo in­fra­struc­ture is not at per in­ter­na­tional stan­dard. As a re­sult the air cargo agents in In­dia have to de­pend on a num­ber of other fac­tors be­yond their con­trol, to get pay­ment on time.

As a re­sult, they seek ad­e­quate time to get the in­dus­try stream­lined, for a suc­cess­ful im­ple­men­ta­tion of CASS. It may be re­called that to im­ple­ment CASS by ad­dress­ing the agents’ con­cern, a Joint Coun­cil in­clud­ing 6 air­lines and 6 agents with IATA act­ing as the sec­re­tariat was formed in the re­cent past.

Sharma stressed on de­vel­op­ment of phys­i­cal in­fra­struc­ture for air cargo in­dus­try in In­dia, which ac­cord­ing to him is the cru­cial is­sue. Sharma also pointed out EDI has­sles at the ex­e­cu­tion level which ham­pers cargo traf­fic to and from In­dia. “Still there are a num­ber of pa­pers re­quired to clear a ship­ment. Our air­ports have also be­come very ex­pen­sive now. As a re­sult, we have huge trans­ac­tion costs and dwell time as com­pared to other coun­tries,” he high­lighted. He also em­pha­sised on fixed com­mis­sion (5 per cent) for the freight for­warders. Other burn­ing is­sues in­clude com­mis­sion on sur­charges and ser­vice tax, for what ACAAI would con­tinue the fight.

SL Sharma

Vice Pres­i­dent, ACAAI

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