Logistics growth in full swing

Enthused by the robust performance in FY 2014-15, the logistics players in the country are all set to take the momentum forward and achieve higher revenue growth in the next one year. In this annual issue of CARGOTALK, we highlight the performance of FY 2

The financial year 2014-15 ended on a good note for the logistics industry in the country. It recovered well after the slowdown in FY 201314. With most of the leading logistics players posting double digit growth, the industry had successfully negotiated the bad phase of the past years.

Interestingly, the performance of most of the logistics players has been uniformly spread out through all the quarters of the financial year 2014-15. The growth has been achieved on the back of good performance of various sectors of the economy, including manufacturing and automobile.

The air cargo industry (domestic and international) had registered 11 per cent growth over 2013-14. Out of the total air cargo of 25.20 lakh MT handled during the year, 9.8 lakh MT was domestic and 15.4 lakh MT international. Though, the growth of domestic cargo has been significant, i.e. 18 per cent over last finan- cial year (2014-15), it was only 6.9 per cent in the international sector. The year 2014-15 saw valuable initiatives being taken on air cargo front, for example, the drafting of the Civil Aviation Policy, though it is yet to come into effect.

On the ports front, total containers handled at all Indian Ports increased by around 10 per cent from 10.45 million TEUs in 2013-14 to 11.53 million TEUs in 2014-15. The supply chain industry has grown at roughly 25 per cent CAGR.

On the other hand, the industry has also adopted a serious view towards intellectual skill, infrastructure for education so as to raise a capable workforce to enhance efficiency.

Let’s hear it from the leaders on how 2014-15 fared for the industry and how logistics companies performed, along with their targets for this financial year (2015-16).

Air Cargo Forum of India (ACFI) with other cargo industry associations like IATA, ACAAI, FFFAI and Bar-India Cargo have sought Government support on the following: Implementation of EDI in order to have paperless transactions. All the message/documents exchanged between stakeholders including Customs electronically should be digitally signed. Multiple Government agencies should be linked with the Customs for their respective NOCs. This will integrate all clearances through single window saving time and paper. Dwell time of export and import cargo at all Indian airports is very high and should be brought down drastically. The above steps will help in doubling (22 per cent) the growth of air freight industry from its current rate of 11 per cent.

ACFI has also given 11 recommendations related to air cargo logistics supply chain industry in following two parts to be incorporated in the Draft Civil Aviation Policy;- Improvements to promote air cargo trade in terms of volumes and business. Improvements to bring efficiencies in the air cargo supply chain to make India an attractive and efficient business location.

ACFI has taken up a number of issues with the various Ministries about the challenges the air cargo logistics industry: Customs Broker, Agent and Carriers to be defined clearly in the Customs Act for its duties and responsibilities so that actions on none compliance/violation shall also be fixed clearly and not on presumption. Custodian should be empowered to deliver Import CNs to importers after Customs out of charge and exporters after let export order without further intervention of Customs in the terminal operation which duplicates the operation and delays the process. Customs Cost Recovery should be applied only in cases where the duty points are in remote areas and the requirement of Customs officers is for specific industry centric. Implementation of Customs EDI to be done for paperless transaction. Dispensation of printing Export Promotion (EP) Copy in the Customs EDI system when export shipments airlifted out on the country is transmitted to DGFT electronically from Customs ICES. Introduction of Single Window Clearance in the processing of international cargo to reduce time, paper work and reduce transaction cost. Go green records keeping for all the documents maintained by Customs Broker in soft copies 44 policy related recommendations for Amendment in the Customs ACT 1962 has been sent to CBEC for consideration.

Pradeep Panicker

President, ACFI