How to streamline it
Cargo Handling Procedures
The cargo handling procedures in India, is an area of serious concern in the context of the end-to-end logistics management. During the last couple of years, apart from the initiatives taken by the government at the policy level, ground handling and terminal operator companies, have taken some remarkable initiatives to streamline the system. However, there is still a long way to go for improving them in India. In this issue Cargotalk highlights some key developments, challenges and recommendations for air cargo handling procedures.
The cargo handling procedures in India, is an area of serious concern in the context of the end-to-end logistics management. During the last couple of years, apart from the initiatives taken by the government at the policy level, new private companies, viz, ground handling and terminal operator companies, have taken some remarkable initiatives to streamline the system. However, there is still a long way to go for improving them in India. In this issue, Cargotalk highlights some key developments, challenges and recommendations for air cargo handling procedures.
i t is often said that the air cargo handling procedure in India is not up to world standards. However, there is a serious debate on the definition of ‘world standard’. “How do you define ‘world standard’? Would a swanky building with an automated system be called world standard or a system which delivers to the customer’s expectation be called world standard? Can getting an ISO certification be termed as world standard? Or is it something that meets or exceeds some standards established by global expert groups? So there are different interpretations to the term world standard?”, said Radharamanan
Panicker, CEO, CSC India. He firmly believes that there is no defined standard globally against which the cargo handling methods or a facility can be measured yet. The IATA ground handling working group is now working on defining global standards for cargo handling.
Panicker points out that India has its own set of problems that play the critical role against meeting global requirements. “We have difficulties in some airports in terms of inadequacy of infrastructure, lack of process and lack of trained human resources. When some of the elements are missing, it leads to customer dissatisfaction. Accordingly, even if ultimate service standard is of the highest order, the overall impact is unsatisfactory”, Panicker opined.
We have difficulties in airports in terms of inadequacy of infrastructure,
lack of process and trained human resources”
CEO, CSC India
The 24x7 customs clearance policy, along with simultaneous working by all the trade partners, has reduced the dwell times” Rajesh Goel CEO, Celebi Delhi Cargo terminal
According to Rajesh Goel, CEO, Celebi Delhi Cargo Terminal, the current cargo handling procedures in India have been streamlined a lot as compared to the older days. However, the processing time for major export handling activities and import cargo clearance are far below the international standards. Earlier, restricted working hours for cargo clearance congested the cargo terminals. This led to piling up of cargo which put tremendous pressure on the capacity and cargo operations. However, the recently implemented 24x7 customs clearance, along with simultaneous working by all the trade partners has significantly reduced the dwell times.
Panicker was of the view that every organisation, every region, every country will have different business models depending on their local environment. But it is important to know and understand whether the three elements –infrastructure, process and people, are integrated and aligned to meet the expectations and requirements of the customer. “We work to ensure that there is a high degree of alignment between our infrastructure, process and people. We work on the airline SLA and aim to achieve all the goals despite difficulties. These are monitored by our quality teams. Furthermore,
On paper, the cargo handling procedures are up to global standards. However, in ground reality, we are not there yet” Vipan Jain Head Bar India Cargo (nR) and Regional Manager, South Asia and Middle East, Lufthansa Cargo
we try to keep things very simple and not make it complicated. Aided by IT, we are slowly moving towards paperless freight in our terminal,” said Panicker. CSC has started hand-held terminals for data entry and messaging. Presently, the company is working on barcoding all the import cargo.
Overlapping roles of intermediaries and warehouse operators creates serious problems for the industry” Shankar Iyer Director-Cargo, South East Asia & Middle East, Swiss World Cargo
Goel informed that at the Celebi Terminal at the Delhi International Airport the dwell times have been visibly reduced and this can be attributed to simplification and streamlining of procedures and cooperation by related stakeholders. “There has been more automation in the terminals and increased adherence to e-freight initiatives.
Recently, we have also been recognised by IATA as a 100 per cent e-freight terminal. However, there is still a lot to achieve to reach the levels of the international cargo hubs, where the dwell times are significantly lower,” he admitted. Recently Celebi introduced many value-added services that include Document & Supervision Services, Import Priority, Export Priority, Pharma Logistics, Transit Mail Sorting, Direct Flight Segregation/ Delivery and many others.
The innovative ideas from service providers are commendable. But the question remains— that can the deliverables yield the desired results. “On paper, the cargo handling procedures are similar to the global standards. However, when it comes to ground realities we are not there yet. We ( India) have ratified MC99 and entered it into force in 2009 as MC99 allows the use of electronic means in lieu of a paper air waybill for preserving the record of carriage. We are still lacking in replacing the paper with electronic means and EDI just works as back-up to paper,” said Vipan Jain, Head Bar India Cargo ( NR) and Regional Manager, South Asia and Middle East, Lufthansa Cargo.
Jain raised various issues pertaining to export and import shipment clearance. He pointed out that the Government of India took major trade initiative and introduced 24x7 clearance at main airports from customs side. However, the airlines still face a problem of underload of flights, whenever there are two or more consecutive holidays, including second Saturday. “I feel all the players do not have sufficient resources and so they would like to propose seven days working during the day to begin with followed by 24x7 working, once we are all prepared,” stated Jain.
On the import front, amendments in the manifest or the arrival of shipments and part shipments due to last minute off-loading at the last point of entry is still a major bottleneck in the process, even though it is only two-three per cent. “A lot of time is spent by carriers and consolidators for amendments with customs and handling agents. We are in EDI mode for more than 18 years now. However, everything is still on paper, when it comes to permission from authorities,” Jain underlined.
Keeping EDI apart, the physical infrastructure is not conducive either. “Major challenges include unrealistic infrastructure and sometimes even lack of vision. Overlapping roles of intermediaries and warehouse operators creates serious problems for the entire air cargo industry in the country,” maintained Shankar Iyer, Director-Cargo, South East Asia & Middle East, Swiss World Cargo.
Bharat Thakkar, Immediate Past Presient, ACAAI, maintained that the Public Private Partnership ( PPP) model was a turning point in the Indian history of economic growth especially to the ports and airports. As a result, at Green Field such as Bengaluru or Brown Field such as Delhi and Mumbai, significant changes have been brought in by PPP models. Unfortunately, there has been no remarkable progress in cargo handling methods. “We do agree that passengers should be given adequate facilities and priorities at the airports. But it should not be done grossly at the cost of and at the neglect of the cargo facilities,” he said.
“The cargo handling procedures in India are far from world standard. The export dwell time at the metro ports is over 24 hours, whereas the world standard is less than 12 hours. We still have long waiting hours for the trucks before the cargo is off loaded. This is followed by a long process of cargo sitting in the examination area before it is moved to the bonded area even though only a small fraction of shipments are to be examined ( Delhi being an exception in this respect). We still have many paper documents required to transact business between the forwarder, the custodian and the airline, which is increasing the transaction cost,” pointed out Cyrus
Katgara, Partner, Jeena & Co.
However, Umesh Tiwari, Chairman, Perfect Cargo Movers maintains that there are a lot of developments at the airport level thanks to the entry of private terminal operators. Though, there are some airports (e.g. Mumbai) still facing space constraints. In his opinion, the 24x7 working policy of Customs is also playing a very positive role for smooth handling of cargo and currently about 90 per cent export shipments are going on time.
Interestingly, there are some significant developments in domestic air cargo handling.
We agree that passengers should be given priorities at the airports, but it should not be done at the cost of the cargo facilities” Bharat Thakkar Immediate Past Presient, ACAAI
Paper documents are still required to transact business between the forwarder, custodian and airline, which increases the transaction cost” Cyrus Katgara Partner, Jeena & Co
There are a lot of developments at the airport level thanks to the entry of private terminal operators” Umesh Tiwari Chairman, Perfect Cargo Movers The implementation of e-AWB by the airlines has eased the information and handling flows” Amit Bajaj General Secretary, DACAAI and Director, Mituj Marketing
“There has been a drastic change in the handling of domestic air cargo. The handling has moved from small individual airlines warehouses to Common User Terminals. The IT infrastructure has improved immensely. The implementation of e-AWB by the airlines has eased the information and handling flows,” highlighted Amit Bajaj, General Secretary, DACAAI and Director, Mituj Marketing.
“We are heavily dependent on manpower for handling of cargo. Simple mechanisations like large base trolleys, movable conveyors, weigh bridges, large pallets X-ray machines, etc. are missing. CCTV monitoring is also lacking at most airports. The terminal operators and the airlines need to invest in mechanisation to justify the handling charges they are charging,” he added.
According to Panicker, cargo has to become important in the minds of policy makers, the government and airport operators. It plays a large role in the economy of the region and city in which the airport is located. “If we have to move cargo to air mode of transport, we will have to make the entire air cargo supply chain cost-competitive versus sea mode of transport. It is a collaborative responsibility of everyone in the supply chain,” he observed. Panicker maintained that regulations have to be simplified and interpreted correctly and should be followed in same manner every where in the country.
“There should be a clear-cut policy to enhance the efficiency of all the agencies working at the airports. Apart from Customs, several other agencies are also responsible for clearance of goods at airports and everybody should improve their processes for easy and fast clearance,” Goel added. He feels that the policies should be to improve efficiency through automated material handling system and IT system, for making paperless environment and e-freight with a collaborative approach.
“We clearly need guidelines from the Ministry that wherever we have electronic transmissions, no physical paper is required. And, my first recommendation is to adopt the best practices of each airport in India and introduce them at other airports as well,” said Jain. He pointed out that the industry has seen number of procedures which are the best, and of international standards. However, it is not easy to implement them on another international airport within India. “We would request the Ministry / Custom Board to have an open session with the trade members and implement the same by way of notification,” he appealed.
Commenting on some recommendations on regular operational methods, Jain said that the responsibility of the export side counting of packages should lie with the handling agent and not the carrier or customs. Similarly, after customs clearance LEO, it should be the handling agent’s responsiblity to release goods to the carriers and not customs or CISF. However, random checks can always be made by regulatory authorities, instead of routine ones. He also advocated for early adoption of e-freight.
“There should be a seamless movement from truck dock acceptance to aircraft and vice-versa. It should be facilitated with reasonable timelines, reduced documentation and procedural rigmaroles. Servicing should be by skilled, customer-oriented and eye to compliance personnel,” emphasised Iyer.
“Reduce dwell time, improve efficiency, enhance facilities, provide better procedures and move over to a system-driven process,” endorsed Thakkar. He pointed out that the dwell time is the cumulative result of various factors, some are even before arrival of the aircraft. Primarily the triggering point for the dwell time is the filing of IGM or Import General Manifest with Customs. ACAAI has been advocating that this can be from the point of wheel-up of the aircraft at the origin airport (like followed in US and most of the EU/Japan/ Korea). Thakkar also pointed out that timely handling of cargo from touchdown of the aircraft by the custodians plays a significant role in reducing dwell time. According to Thakkar, processing time of documents by Customs has come down in the past decade. But this is not sufficient to drastically bring down dwell time. “We need a new look at the entire Customs process which should be driven by systems. Nontraceability and damage to cargo increases dwell time and both are controllable, if proper system is in place and is monitored,” he said. He further pointed out one more challenge, which is the restricted / congested approach both inside and outside the airport terminals for vehicular movements. It slows
We should bring in mechanisms for interactions between shippers and terminal operators for the greater interest of the industry” Suman Dhaulta Managing Director, KVM Aircargo
down clearance process and increases dwell time. Katgara urged for standardisation of the process of seamless, paperless movement of cargo from forwarder to the bonded area at all airports. Only the shipments required for examinations should be recalled from the bonded area similar to what is being done in Delhi. “The transactions at the airport should be paperless and the dwell time at all airports should come down to 12 hours,” he said. Tiwari appealed that terminal operators have to be more careful about mishandling and missing of cargo. Cargo should not be loaded or sent without a manifest.
According to Bajaj, more common user terminals need to come up, for ease of handling of cargo. Infrastructure in B-class cities lacks this, even though the domestic cargo is growing. “To sustain this growth, we need to look at the infrastructure at the smaller cities urgently,” he recommended. In his opinion, to increase efficiency in handling cargo and to minimise breakages, the operators need to invest in handling equipment. There is a lack of basic equipment like large base trolleys, weigh bridges, conveyors, etc. “On the IT side, the transparency is lacking. No stakeholder is willing to hold data transparently and define a SLA. There is a desperate need for transparency in the working of the stakeholders. We need to define SLAs for each agency which can be viewed transparently and reviewed on a regular basis,” he stressed.
According to Suman Dhaulta, Managing Director, KVM Aircargo, there should be more job responsibilities from the private terminal operators. It is because of private investments and initiatives that the infrastructure has improved significantly. But there should be a skill enhancement to utilise the infrastructure optimally. There should be more facilities for handling temperature sensitive cargo and more truck docks for smoothening operations. “We should bring in some serious mechanisms for interactions between shippers and terminal operators for the greater interest of the industry and the country’s economy,” she concluded.