08 Air Cargo Policy Big leap for India
The objective of NILP is to increase the capacity of storage, warehousing and value-added services
The new air cargo policy, recently unveiled by the government, covers all categories of air cargo transport - domestic cargo to ensure efficient flow of goods across India; international cargo facilitating export and import of indigenous goods; and transit international cargo, by making India the transit cargo hub of choice to and from other parts of the globe.
The government recently unveiled its much-awaited national air cargo policy at the Global Aviation Summit in Mumbai. The policy, aimed to bring down the cost of air cargo logistics, seeks to make India one of the top five air freight markets by 2025, besides creating air transport shipment hubs at all major airports over the next six years. It states that international cargo comprises 60 per cent of the total air cargo tonnes handled in the country, logging a growth of 15.6 per cent in the previous fiscal and domestic cargo growth by over eight per cent, which reflects the skewed modal mix in which roads account for over 60 per cent of cargo transportation as compared to the global average of 30 per cent. The policy will also encourage code sharing/inter-line agreements between foreign and Indian carriers. The objective of the National Integrated Logistics Policy (NILP) is to focus on increasing the capacity of storage and warehousing and other value-added services. Multimodal logistics parks and integrating various transportation modes are also being developed right up to the district level. The EXIM policy document states, logistics development and boosting trade is an integral strategy of the overall economic development vision of the government. The Foreign Trade Policy 2015-20 envisages making India a significant player in the global trade landscape by 2020, and targets doubling India’s exports from 2014 levels to about US$ 900 billion by 2020; raising India’s share in world exports from two to 3.5 per cent by that year has also been spoken of. Under air cargo research and development, a well-equipped research and development centre has been discussed for air cargo that can plan, co-ordinate, implement, and monitor air cargo traffic and support the development of appropriate solutions. The air cargo industry needs to adopt the latest technological standards to have an optimal resource utilisation and increase efficiency, which will help increase revenue for all the stakeholders. New supply chains/ commodities need to be developed to facilitate ease of doing business and promote the use of air transport as a preferred mode for outbound or inbound movement of cargo.
The ACLPB is to set up an interministerial body for planning, co-ordination, implementation and monitoring, which is a must for making the policy functional. The ACLPB, in consultation with the Department of Industrial Policy and Promotion (DIPP), will develop policies to support the growing business area of e-commerce and any other growing business areas in consultation with relevant governmental departments, as well as to support intermodal operations for effective connectivity of air with sea, road, rail, inland waterways supply chains. Multimodal freight corridors are to be developed to connect Indian suppliers and consumers with major trading centres. As per the document, Multimodal Logistics Parks (MMLPs) will be a key initiative to improve the country’s logistics sector by lowering overall freight costs, reducing vehicular pollution and congestion, and cutting warehousing costs. The Central government, through the Ministry of Road Transport & Highways (MoRTH), is developing multimodal logistics parks at select locations in the country, under its Logistics Efficiency Enhancement Program (LEEP). To support efficient AFS, guidelines will be established to ensure smooth and viable AFS operations, including sterile corridors when security integrity has been ensured at and from the AFS. As part of the security strategy under the policy, it will address security related to physical cargo, people handling the cargo, as well as data and information related to shipments within and across all chains of custody transfers. The strategy will cover all aspects of defining, measuring, improving, and avoiding safety breaches in air cargo operations at all cargo handling areas of the airport. The Cargo Community Infrastructure policies will include both physical and digital infrastructure that will facilitate efficient digital collaborations to ensure a smooth flow of air cargo to and from airports and off airport facilities. ACLPB will review specific policy requests emanating from trade or supply chain participants, and will make appropriate recommendations to the government. The policy mentions that every airport with predominantly courier/ express cargo operations will have common user facilities and dedicated express cargo facilities. In case of perishable cargo, pack houses have been defined necessary to reduce wastage and help in delivery of fresh cargo at the destined location. The policy mentions the creation of dedicated digital/e-freight corridors between Indian airports and major airports globally, such as connect Chennai, Mumbai, or Delhi to any other major airport in Dubai, Miami, Frankfurt, or Singapore. The policy document asks for streamlined customs processes to promote transhipment that is cost-effective, quick, efficient, and seamless. Transhipment permissions are to be granted 24x7, and will be automated and streamlined to ensure that they are received prior to the arrival of the flight (in case prior information is provided) and within one hour of flight arrival in case permission is sought at the time of arrival of flight. The document also mentions that cargo movement at airports which face bottlenecks due to cumbersome administrative processes or shipment-related discrepancies will be streamlined to ensure pre-defined processes for dealing with instances such as return to shipper; unmanifested, short-landed, short-shipped, over-carried or part shipments. To promote India as a humanitarian support transit centre, special policies encouraging the establishment of regional humanitarian relief support centres will be established, preferably within the SEZ or FTZ. The policies around technology and innovation will address the emerging next-generation practices on digital transformation, the emergence of business platforms, insightful analytics, and explosion of smart devices that facilitate cargo transport processes and refine them to Indian conditions. The document also promotes domestic and international e-cargo by establishing dedicated digital or e-freight corridors from Indian airports to e-freight-ready airports. The policy will also institute a framework for educating the future generation of workforce about the importance and sophistication of the air cargo industry, and develop a training methodology that attracts and retains the best talent in the Indian cargo industry.