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A s the new Union Government will take charge post general elections of 2014, it is the appropriate time

to demand for a nodal ministry or a nodal body for cargo and logistics industry in India, which is so far nobody’s child. Paradoxically, for this sunrise sector no clear direction has been laid down by the policy makers comprising of multiple ministries, agencies and authorities. Hence, issues are mounting to create huge obstacles for the cargo and logistics industry, leaving the country out of the race, as compared to other developed and developing countries as regard to the transit time and transaction cost. It may be recalled that India has exorbitant logistics cost of about 13-14 per cent of the national GDP.

In the past few years, Cargotalk has raised the issue of having a nodal ministry/body for the cargo and logistics industry. Several trade bodies and industry majors have expressed strong feelings favouring the issue. However, there was a serious lacuna between the intent and action. There were no persistent initiatives, especially from the trade associations and the industry chambers of commerce to make a dent on the thought process of the protagonists at the corridors of power. The debate about the nature of the nodal body can continue, at the same time, by going for some long-term action plans.

To deceive the gravity of the issue, the concerned authorities may refer to the bodies like Air Cargo Logistics Promotion Board to achieve the desired goal of the industry—i.e a strong cargo and logistics infrastructure armed with industry status. However, until and unless these platforms are not headed by a viable institution such as the PMO or Cabinet Secretary, the logjam would remain the same, owing to sectoral interests of various ministries and departments.

Remarkably, there are some indications that a few associations are coming closer to bring up the fight for industry status and a nodal authority. The sooner all major associations and chambers and commerce stand under one umbrella for the greater interest of the cargo and logistics industry (and hence, for the development of the country’s economy), the better the results will be for the industry. It’s a huge opportunity to ask the new government and the Members of Parliament as well, which direction they want to lead the country towards - a manufacturing-oriented growth supported by a world-standard logistics industry or through a mere service sector?

Need a nodal body for logistics

EditorSANJEET

Sr. Assistant EditorRATAN KUMAR PAUL

Sub EditorSHUBHI TANDON

Asst. Vice PresidentGUNJAN SABIKHI

Deputy General ManagerHARSHAL ASHAR

Regional Head: North & WestSHIV KUMAR

Assistant Manager: WestROLAND DIAS

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Photo JournalistSIMRAN KAUR

Advertisement DesignerVIKAS MANDOTIA, NITIN KUMAR

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Circulation ManagerASHOK RANA

Cargotalk


SECTORS

NATIONAL NEWS8 I AEPC showcases skill development initiatives

CII confers Gati-KWE with ‘5s Excellence Award’

10 I ACLPB holds its 4th meeting to update new initiatives

Qatar Airways Cargo starts freighter to Hyderabad

LOGISTICS SERVICES12 I Changing face of logistics: skill is the key

INTERNATIONAL NEWS14 I dnata launches aircraft line maintenance services

Emirates starts daily services from Dubai-Boston

Hong Kong to host WCA Conference Week

INTERNATIONAL AIRLINES16 I Need bonded warehouses for agents for smooth cargo flow

AIRPORTS & AIRLINES20 I AAI wins ‘JANES ATC Award 2014’ for its ATC system

IATA launches second edition of Cargo-XML Manual

TRAINING INSTITUTIONS22 I Million Minds to host ‘LAA & TH’ on July 4 in New Delhi

TRADE OPPORTUNITIES32 I Dubai Exports opens office in Mumbai

CARGO PERFORMANCE34 I Airlines-wise exim cargo performance for February 2014 at Delhi International Airport

35 I Airlines-wise exim cargo performance for February 2014 at Mumbai International Airport

SUCCESS & ACHIEVEMENTS40 I ICC awards for logistics fraternity

FAMILY ALBUM42 I ACCD ‘Ball 2014’ warm up the chilled ambience

INDUSTRY ASSOCIATION46 I NISAA urges for hinterland connectivity to boost port services

SHIPPING & PORTS48 I Strict, strong vigilance needed to stop cargo pilferage

DP World to build new Terminal at JNPT, Mumbai by 2015

CIVIL AVIATION50 I Aviation Ombudsman assures redressal of trade issues

COLUMNS

LEAD STORY28 I Smartphones drive demand for efficient supply chain management

ContentsAPRIL 2014

24 I COVER STORY

Seeking effective manufacturing

policy and industry statusWhat should be the focus of the ensuing new government at the Centre for the beleaguered cargo and logistics industry in India? With the long pending industry status for this segment on top of the wish list, the industry leaders have huge expectations from the new government. If the interim budget is an instance of traditional apathy for this industry, the full budget has to take some bold steps to bring in winds of change. Cargotalk presents industry perspectives.


National NewsNew initiatives

The Apparel Export Promotion Council (AEPC) recently organised an exhibition

to showcase its skill development initiatives through Apparel Training and Design Centre

(ATDC). The event called ‘Hunar ki Hunkar’ was held in Apparel house in Gurgaon, NCR Delhi. The event was inaugurated by Virender Uppal, Chairman, AEPC in

presence of Hari Kapoor, Vice-Chairman, ATDC, Ashok Logani, Chairman, DISHA Sub-Committee and several other dignitaries. The ‘Skilling & Upskilling’ journey by ATDC in the pilot project period and the activities and initiatives to achieve the target of 2,50,000 candidates in five years has been showcased in ‘Hunar ki Hunkar’ Exhibition-cum-Display. Speaking on

this occasion, Uppal said, “ATDC- ‘Hunar ki Hunkar’ is a key platform created for the youth of India who need vocational training to be productive. This programme provides a wide variety of skills for employers, training providers, corporates, NGOs and other stakeholders in the industry.”

It is estimated that from 2013-2022, about nine million people will be added to the apparel industry (both exports & domestic), out of which at least 7-8 million would be the addition to shop-floor workforce. According to Uppal, with high attrition rates of 12-18 per cent in the production floors, trained workforce will be required as substitutes and also for expanding capacities.

Blue Dart celebrates CSR Day in Mumbai B lue Dart Express, recently presented the 3rd Blue Dart World CSR Day and Global CSR

Excellence & Leadership Awards at a glittering function in Mumbai. The awards recognise global corporate social responsibility and sustainability champions across various industries. Dr. Bhaskar Chatterjee, Director General & CEO, Indian Institute of Corporate Affairs and Yogesh Dhingra, Finance Director and Chief Operating Officer, Blue Dart Express were present at the function to present the awards. The event was well attended by leading organisations like United Nations, Sanofi, KPMG, Hewlett Packard, CRY, Indian Institute of Corporate Affairs and many more. It comprised of panel discussions about ‘CSR Good to Great - The Path Ahead’, ‘Assessing and developing potential for leadership’, ‘Measuring the success of CSR’, ‘The Vision of CSR’ and ‘New Insights into the Correlation Between CSR and Brand Strength’. The panel discussions were focussed on the way forward over the two per cent CSR mandate and the impact on various organisations undertaking CSR activities.

CII confers Gati-KWE with ‘5s Excellence Award’Gati was recently awarded second prize for ‘5s Excellence’ in the Large Scale Service

category by the Confederation of Indian Industry (CII). The audit report of the company by CII states that Gati maintains top quality by ensuring active participation of its employees, regular training programmes, timely audits, adherence to the ‘5s’ methodology and cleanliness of the premises. 5s is the name of a workplace organisation method that uses a list of five Japanese words: seiri (sorting), seiton (straightening), seiso (shining), seiketsu (standardise), and shitsuke (sustain). Commenting on the occasion, Sanjeev Jain, Director Finance, Gati said, “At Gati, we have an enthusiastic management team which is constantly dedicated to provide better services to our customers and improve their experience. This award by CII will act as a token of appreciation for us and we will continue this practice.”

Recently, GATI-KWE also won an award in ‘Road Transportation’ at the ‘Indian Chamber of Commerce Excellence Awards 2014’ and another one for ‘Achievement in Continuous Improvement’ in supply chain management category at the ‘3rd Asia Manufacturing Supply Chain Summit (AMSCS)’.

AEPC showcases skill development initiatives


National NewsAviation

ACLPB holds its 4th meeting to update new initiatives

Qatar Airways Cargo starts freighter to Hyderabad

On March 4, 2014, the Air Cargo Logistics Promotion Board (ACLPB)organised its

4th meeting at the ministry of Civil Aviation office, Rajiv Gandhi Bhawan, New Delhi under the Chairmanship of Ashok Lavasa, secretary, Civil Aviation. The meeting was attended by the representatives of industry associations and other stakeholders.

Major recent developments that took place across the country for air cargo industry include positioning of a Quarantine Officer at Coimbatore International Airport; MoCA’s initiative to take up the matter of cost recovery charges by customs with the concerned ministries and MoCA’s advice to AERA for frame rules for setting standards in respect of cargo handling and ground handling. At this meet, the AAI representative informed that regarding the long-term tenure (15 years) of express terminals, a tender for operation and management of common users’ express terminal had already been floated for two years as the old

terminal building in which the space is provided was falling under expansion plans.

The ACLPB meeting also discussed the need of preparedness of Chennai Airport for complying with EU ACC3 by May 15, 2014. At this meeting, MIAL suggested reducing the free dwell-time for import cargo shipments from the existing 72 hours to 48 hours in airports, where 24x7 cargo operations are implemented

effectively. However, other trade representatives opposed it on the ground that nearly 24 to 36 hours are lost in making cargo ready for delivery. On this point the secretary civil aviation advised that a small group comprising chairman, AAI, representatives one each from BAR India, APAO, ACAAI, and freight forwarder association of India would look into the issue and come out with their recommendations within two months.

To achieve its goal, Qatar Airways is constantly

increasing frequencies and expanding number of destinations across the world, so that its customers can benefit from the airline’s global reach. “The addition of these new freighter routes clearly represent yet another milestone in Qatar Airways’ growth strategy,” said Ulrich Ogiermann, Chief Officer Cargo, Qatar Airways. He also

confirmed that the airline will take delivery of three new freighter aircraft in the course of 2014: two B777F and one A330-F. Hyderabad will be the first new destination to be added to the Qatar Airways Cargo network, with the start on April 1, 2014 of a twice weekly service, using the A330 freighter. Main exports from Hyderabad

will include IT products and pharmaceuticals. Qatar

Airways already operates a daily passenger flight between Doha and Hyderabad. Qatar Airways Cargo recently strengthened its product portfolio with the launch of two new premium services in January 2014 that optimises the transportation of time and temperature-sensitive goods, including high-value pharmaceutical products and perishables. According to the Qatar Airways sources, the new services, ‘QR Pharma’ and ‘QR Fresh’, add to the company’s wide range of cargo services and further enhance its capacity and flexibility to effectively move sensitive commodities.

Qatar Airways Cargo has decided to begin a new scheduled dedicated freighter service to Hyderabad in line with its objective be a world-class air cargo service provider.

Ulrich OgiermannChief Officer Cargo

Qatar Airways


Logistics Services Skill Development

The logistics industry in India is currently facing a shortage in the supply of drivers, filed workers and warehouse workers. On the other

hand, low operating margins within road transport sector in particular are creating barriers for the workforce. “Moreover, there is lack of understanding and awareness about career opportunities in the logistics sector, affecting efforts of employers to recruit skilled manpower,” said Shankhdhar.

“At present, we do not have a cohesive approach to achieve the goal of developing skilled manpower. The major companies look at it from the competition’s perspective rather than focussing on the larger issues of the industry. There are historical, cultural and commercial barriers between larger trade associations, which prevent a unified approach on these issues,” he maintained.

In Shankhdhar’s opinion, the industry needs to take a two-way approach— attracting new workers at the entry level and building bench strength of leaders for future supply chain professionals. For new workers, the focus should be on under-represented groups, school/college dropouts, mature age workers, migrants and differently-abled people to train them on skills required to perform minimum duties.

“To build the bench strength of leaders, we need to market at the school/college level about opportunities available in logistics sector to the young generation by providing tours to witness logistics facilities, short-term work experience, structured on-the-job training and creating further awareness through success stories and case studies,” Shankhdhar added. He also observed that in the long-term, the

industry needs to collaborate with universities and colleges to help identify up-and-coming young people who would excel in the field. This includes helping with industry-developed curriculum, offering scholarships, offering paid internships, and conducting guest lectures in educational institutions to build interest and excitement for the SCM discipline as a whole. Commenting on the initiatives from DTDC, he highlighted that the company is focussing on talent retention and building in-house talent. “The company has created a separate ‘Learning and Development’ department which

focusses on continuous training on process understanding and soft skills development,” said Shankhdhar. DTDC is investing in its employees by helping with formal ongoing education as well as informal educational opportunities. The company is running formal education training through DISCM (DTDC Institute of Supply Chain Management) which offers CILT courses for internal staff and external professionals. Shankhadhar feels that the industry needs to promote different forums, associations where ideas can be freely exchanged, best practices can be debated. The universities and institutes also need to participate in such initiatives. “It is also important that the industry and government work together to effectively manage changes that will facilitate improved performance,” he concluded.

He, however, pointed out that the need for logistics training is slowly gaining acceptance lately, though it is still at a nascent stage, and has a long way to go. There are a few universities who have started courses in port management, aviation and supply chain. Few MBA colleges are also offering PG or Certificate programmes in various segments of logistics. “There is a need for introspection and brainstorming to overcome the manpower crisis in the industry. There is a paucity of institutionalised skill development,” he said. According to Shankhdhar, the number of faculty currently teaching in the logistics and supply chain sector is not sufficient enough to train all the new professionals that are needed. “We have found that the universities and institutes do not have a vision beyond the placement of their students. Their thought process is limited with commercial gain, without taking pains to address grassroot issues which have to be changed,” he stressed.

Changing face of logistics skill is the key In view of the fact that the businesses are facing pressure to cope with the increased demand, customers are seeking faster services. There is a need to keep up with the evolving technology. Further, growth of online sales also puts extra pressure on businesses already facing skill shortages. Amit Shankhdhar, AVP – North, DTDC, elaborates on the industry scenario and the company’s initiatives to fill the skill gap.

We need to market at the school/college level about the opportunities available in logistics sector to the youth - by providing tours to logistics facilities, and short-term work experience and on-the-job training

RATAN KR PAUL

Amit ShankhdharAVP – North

DTDC


International NewsNews in Brief

T he world’s leading freight forwarding event has moved to a new venue in Hong Kong, following the

postponement of the conference that was scheduled to take place in Bangkok in March. WCA Conference Week, comprising the ‘16th WCA First Conference’, the ‘6th WCA Worldwide Conference’ and the ‘2nd WCA Relocations Conference’, will now take

place from May 11-18, 2014, at AsiaWorld Expo, adjacent to Hong Kong International Airport.

Over 2,500 logistics executives had confirmed their participation at the original event and over 160 meeting booths were booked. “The WCA staff has worked tirelessly to ensure the switch has been completed

smoothly and that, if anything, the event will be even better than before. We have ensured that no participant will be out of pocket on their travel arrangements due to the switch and we look forward to hosting over 70,000 individual meetings that will see the independent freight forwarding sector generate millions of dollars in new business,” asserted David Yokeum, President, WCA.

Hong Kong to host WCA Conference Week

Emirates starts daily services from Dubai-BostonO n March 10, 2014, Emirates launched its daily, non-stop service

between Dubai and Boston. Boston becomes the airline’s eighth US destination and the 142th on its global network.

The inaugural flight EK237 carried a delegation of senior airline executives including: Tim Clark, President, Emirates Airline; Adel Al Redha, Executive Vice President & Chief Operations Officer, Emirates, Hubert Frach, Divisional Senior Vice President Commercial Operations West, Emirates and Hiran Perera, Senior Vice President Cargo Planning and Freighters, Emirates. Emirates will operate daily flights between the two cities with a Boeing 777-200LR. In addition to passengers, Emirates SkyCargo will operate bellyhold cargo space to help transport goods to and from Boston. This includes goods such as electronics, medical equipment, pharmaceuticals, machine parts, leather products, consumer commodities, as well as New England’s finest lobster. Emirates SkyCargo can carry up to 15 tonnes per day.

dnata launches aircraft line maintenance services

Recently, dnata’s airport operations division has launched aircraft line maintenance to support passenger and cargo airline operators. The company is providing technical assistance for aircraft landing at Dubai

International Airport and Dubai World Central Al Maktoum International Airport. According to the company sources, dnata’s team of engineers and technicians are able to provide full line maintenance support and are trained on contracted airlines’ operational procedures. “With a highly-skilled team, the technology, and the

expertise, our line maintenance services are a cost-effective solution for airlines of any size,” said Ismail Ali Al Banna, Executive Vice President, Airport Operations, dnata.


International AirlinesViewpoint

The air cargo industry is witnessing better cargo handling mechanism especially in the IGI airport, Delhi owing to the two warehouse

operators— Celebi and DCSC, who are striving to give an enhanced-quality service. Significantly, Delhi is now the only airport in India which is an e-freight certified airport. Other two airports, which are in the process of finishing, are Bengaluru and Hyderabad. According to Kose, customs have also taken an initiative towards the smooth flow of works at these airports, wherein shipments which have an invoice value of less then `1 million, or where the drawback amount is less than `1 lakh, or those shipments which are duty-free, and not examined or randomly examined 100 per cent.

On the flip side, Kose pointed out that the major challenge that still needs to be done away with is the infrastructure issue. In addition, the Customs procedures in other major Indian airports still takes more time than what it takes at the major airports across the world. The main reason behind that is the lack of big X-ray machines that can X-ray the complete pallet or the odd size cargo. Apart from that, customs are not ready for the BUP concept. On the other hand, the warehouse works more as a storage facility rather than a transiting point, whereas, warehouses at major airports are thriving to be a

transiting point rather than providing storage facility.

Commenting on the procedural hassles at Delhi airport for example, Kose also pointed out that as Delhi is primarily a garments market, each shipment has around average 200-300 pcs, which are first offloaded from the truck at the warehouse gate to complete the necessary processes— counting, weighing and taking the dimensions of all pieces before putting them in bonded area after the customs examination and locating them. All this process takes approximately four-five hours which is considerably more than what it takes at the major airports across the world. “If these shipments come loaded on a pallet or container as BUP from agents to the warehouse it will reduce considerable time in handling at the airport,” he underlined. Accordingly, the warehouse operator will have to handle just one ULD instead of handling a large number of loose

pieces. It will also reduce a lot of irregularity in terms of counting and pieces left behind in the loading process, etc. “The time saved in the handling/clearance of cargo can be passed onto the customer by extending the cargo acceptance time,” he added. Apart from this, the agents in India still don’t have the bonded warehouse which can also play a major role in facilitating smooth flow of cargo movement.

He firmly believes that if Customs can recognise the BUP concept and promote more of these ideas where less handling is involved at the airport there will definitely be an improvement in smooth flow of cargo handling. It will reduce the irregularities and clearance time considerably. “If the agencies hand over the shipments to the airport’s warehouse, after completing their necessary processes in their bonded warehouses, the workload of the airport’s common user’s warehouse can be lightened,” he stressed.

e-freightDelhi is the only airport in India which is an e-freight certified airport at the moment. The other two airports, which are in the process of finishing, are Bengaluru and Hyderabad.

Need bonded warehouses Cargo handling procedures at Indian airports have come a long way. There has been a huge improvement in the way the handling takes place, especially at the five major cities in India viz Delhi, Mumbai, Chennai, Hyderabad and Bengaluru, observed Erdal Kose, Regional Cargo Manager, North & East India, Turkish Cargo.

If the agencies hand over the shipments to

the airport’s warehouse, after completing their necessary processes in

the bonded warehouses, the workload of the

airport’s common user’s warehouse can be lightened”

Erdal KoseRegional Cargo Manager,

North & East India, Turkish Cargo


MovementsAppointments

Dr. CV Ananda Bose takes over as Chairman CRWCDr. CV Ananda Bose (Retired IAS) has been appointed as Chairman of Central Railside Warehouse Company (CRWC). Dr. Bose is also Chairman of Central Warehousing Corporation (CWC). He is currently the Chairman of UN Affiliate Expert Committee. He is also a prolific writer and columnist. Previously, he also served the ONGC, Government of India in different managerial capacity and as Deputy Director, Corporate Communication. He received several awards like ‘Best Corporate Manager (PR) of the Year (1995)’, ‘Rajiv Gandhi Award for Excellent Manager (1996)’ and ‘Human Rights Awareness Award for (2004)’. Premnath is an MBA (Human Resource Management), PG Diploma in Industrial Relations & Personnel Management, M.Phil in Journalism and Communication.

Manish Saigal joins Alvarez & MarsalManish Saigal has joined Alvarez & Marsal as Managing Director. He would be leading the company’s focus on strategy, commercial and operational part and post deal services in the region including India. He would also be spearheading the firm’s focus on transport and logistics, infrastructure and food and agri-sectors. Alvarez & Marsal was founded in 1983 recognising the opportunity to provide radically different advice and hands-on support to organisations with operational and financial challenges. Saigal brings more than 17 years of rich experience in strategy, private equity and M&A consulting. Previously, he has worked with global consulting firms like KPMG and Arthur Andersen. Prior to joining A&M, he helped set-up the strategy group at KPMG and he was also the national head of transportation & logistics sector for the firm.

DHL appoints new Director for Industrial Projects, IndiaDHL Global Forwarding has appointed Rajiv Sharma as the new Director, Industrial Projects, India with immediate effect. Prior to joining DHL, Sharma was with Geodis Overseas, where he worked as Director –

Industrial Project, responsible for developing & managing industrial projects for India. He has been involved in project management, OOG and heavy-lift management for the last 12 years, including coastal movement, road transportation, and chartering and logistics management.

Vikas Anand appointed as Managing Director DHL Supply ChainDHL Supply Chain India has appointed Vikas Anand as Managing Director of DHL Supply Chain India. Anand is currently managing the business as COO. He has been with the organisation for more than 10 years and served in various management positions. DHL has developed supply chain solutions for customers of all sizes, including many of the world’s leading brands and corporations.

Schenker India announces Anup Nair as Director Projects

Anup Nair is appointed as Director-Projects with Schenker India, the national company of DB Schenker Logistics in India. Nair will be heading the project department for Schenker India. He has an overall experience of 19 years in project management in C&F/Heavy Transport, Sales/Marketing, Operations and Logistics. He completed his MBA in Marketing and also holds Diploma in Shipping Management. Prior to joining DB Schenker, he was working as Head – Project Management and Implementation in the industry.

(L-R) Dr. CV Ananda Bose being welcomed by Vinod Asthana, MD, CRWC


AAI wins ‘JANE’S ATC Award 2014’ for its ATC systemI n recognition for its work in the field of operational efficiency as part

of the Arabian Sea Indian Ocean ATS Coordination Group (ASIOACG), the Airports Authority of India (AAI) has been honoured with the

international award called ‘JANE’S ATC Award 2014’. According to the AAI sources, JANE’S Awards are ‘best of breed’ in the industry for the last 14 years in succession. AAI continues to improve operational efficiency at the high-density air traffic centres of Mumbai and Delhi. Innovative use of multiple runways and collaborative

decision making has yielded substantial benefits in not only operational efficiency, but also in fuel savings. V Somasundram, Member (ANS), AAI received the award at a function held at Madrid, Spain.

IATA launches second edition of Cargo-XML Manual

The International Air Transport Association (IATA) released its second edition of the Cargo-XML Manual and Toolkit, providing Cargo-XML standards for the electronic exchange of information that replace the traditional Cargo-IMP for the air cargo industry. The toolkit provides electronic message standards that ensure uniformity, clarity, accuracy and economy in electronic data exchanges.

According to Des Vertannes, Global Head of Cargo, IATA, as a replacement to legacy standards, Cargo-XML will revolutionise air cargo electronic messaging, bringing sustained benefits to the air cargo industry over time. The new Cargo-XML standards are multimodal and cross-border and are based on UN/CEFACT standards and referencing the World Customs Organisation (WCO) Data Model elements.

Airports & AirlinesTechnology & Services


Training InstitutionsLogistics & Supply Chain

The annual event ‘Logistics Achievers Award & Talent Hunt’ is an effort to bridge the gap between the industry and institutions. The latent talent and

achievers are showcased for absorption into the industry and incentive or benchmarking.

“The event, LAA&TH, is not just our project, but a medium for the entire logistics fraternity to come forward and actively participate. Million Minds makes an effort to go to more than 300-400 management schools to choose the most promising candidates, who have an interest in making a career in logistics,” said Premprakash, Director, Million Minds. According to him, the logistics industry needs to clearly define its demands and through this event they would be able to fill-up the gap.

“A short-term training can be provided to these candidates to align them for the specific needs of each company. This effort of Million Minds needs to be appreciated and supported by the entire industry,” Premprakash emphasised.

Million Minds is engaged in training and placement for the logistics industry. The courses in Logistics and Supply Chain

Management are accredited by The Chartered Institute of Logistics & Transport (CILT), UK. In addition, Million Minds provides short-term training programmes/workshops on logistics, warehousing, project management, negotiation

skills and soft skills for upgradation and review, to various company employees.Placement of manpower, at various levels of demand, is also facilitated by the company along with maintaining their payrolls.

However, Premprakash appeared to be disappointed about the response from the industry. “The candidates chosen through competition find it difficult to get suitable employment in the industry. The industry has not stepped forward to lend a helping hand in this matter. If at all, they take these candidates in, they take a long time to come to any decision, which creates unrest in the student community,” he underlined. The emolument offered is also not attractive, at times, to motivate the students to move towards logistics as a career.

He also stressed that under the LAA&TH an umbrella is being created to bring together all stakeholders as suppliers, producers and consumers. “All the different modes of transport, warehouses, financiers, suppliers and final consumers must be united under something like a Logistics Department or Ministry of Logistics so that the industry can be strengthened and well-regulated,” he urged.

Million Minds to host ‘LAA & TH’ on July 4 in New Delhi The flagship event of Million Minds called ‘Logistics Achievers Award & Talent Hunt’ (LAA&TH) has been scheduled for July 4, 2014 in New Delhi. This year, the event will be organised as a day-long programme with sessions on the latest developments in the logistics industry on e-commerce and technical upgradation for cost reduction.

The event is not just our project, but a medium for the entire logistics fraternity to come forward and actively participate

PremprakashDirector

Million Minds

R esponding to a call from the Principal and PTA of GMLP School, near Calicut International Airport,

the Airport Director of the airport, committed to support them by providing uniform to 70 poor boys of the school, who

are not covered under the Uniform Scheme of the Government of Kerala. The Director helped raise funds by voluntarily contributions from AAI employees of Calicut Airport. The airport contributed `25,650 for the cause.

Similarly, to respond to another request from the Secretary, Pain & Palliative Care Clinic, near Calicut International Airport, Calicut Airport supported the terminally-ill and bed-ridden patients under this clinic.

CSR

AAI extends support to school children and patients in Calicut


Cover StoryIndustry Expectations

The cargo and logistics industry seeks an overall growth of the country which in turn gives satisfaction and relief to the citizens of the country.

“Our infrastructure, construction of better roads, airports, seaports require immediate attention of the government. Meanwhile, ‘many corridors’ have been inaugurated but still the date of the ‘finishing stone touch’ is not yet visible. The government must pay full attention towards this sector so that one day we come at par with the global infrastructure,” said SL Sharma, President, ACAAI.

Policy and ExecutionAccording to Sharma, the government

must be serious and should understand the reason why India’s manufacturing Industry is not growing, inspite of the fact that a new manufacturing policy has been introduced. In the coming Union Budget, the government

must focus on the simplification of the rules and procedures in the policy. “One-window clearance is the most acceptable and will improve the functioning. Unless and until, we implement our policies and take fast decisions, we will not be able to encourage this industry. I am confident that the Indian economy will definitely improve, if the policy is improved and properly implemented,” he emphasised.

Sharma argued that there is no proper, effective manufacturing policy of the government. The policy is only on paper and not practical. Due to slow decisions, the interest rate is also rising on the high side. Labour laws are not favourable to the industry. Infrastructure is not at par with the global standard. “The government must have a comprehensive manufacturing policy and the infrastructure should be more comfortable. We should try to reduce the cost

Seeking effective manufacturing policy and industry statusWhat should be the focus of the ensuing new government at the Centre for the beleaguered cargo and logistics industry in India? With the long pending industry status for this segment on top of the wish list, the industry leaders have huge expectations from the new government. If the interim budget is an instance of traditional apathy for this industry, the full budget has to take some bold steps to bring in winds of change. Cargotalk presents industry perspectives.

RATAN KR PAUL

WWW.CARGOTALK.IN APRIL 2014 I CARGOTALK I 25

and also simplify policy which is a cause of hurdle,” he added.

Manufacturing is the KeyShantanu Bhadkamkar, Immediate

Past-Chairman, FFFAI also maintained that there should be serious steps taken to strengthen the manufacturing sector. Unless the manufacturing sector is strong and is on a sustainable growth path, the logistics sector will weaken. In absence of impetus to the manufacturing sector, the employment will not grow and both the trade deficit and the current account deficit will grow. “More than financial resources, a strong commitment to the policy direction of making India an investment-friendly destination for manufacturing is urgently required. Instead of growth in export of the manufactured products, we see a surge of imports of luxury consumer goods and cheap consumer goods substituting the indigenously manufactured goods. This trend needs to be arrested. Unless the manufacturing sector is strengthened, it will not be possible to sustain the public welfare schemes,” explained Bhadkamkar.

He pointed out that the sectors that give the highest yield on investment or spend are education; research including fundamental research, public health and safety; infrastructure including logistics infrastructure (be it cargo logistics or movement of people); tourism; communication and IT; energy, including development of alternative resources, renewable resources and other environment friendly non-fossil fuel or import dependant resources.

Commenting on the specific expectations from the new government he maintained that the expectations are more structural than fiscal. The fiscal

expectations relate to elimination of wasteful expenditure and waste, reduction in the cost of governing the country by good governance. “This is an issue of putting the hand where the mouth is, i.e. spending at the right place, on the right things, in a proper manner and at the right moment. There is also the issue of rewarding good governance and delivery by rewarding it, by greater allotment faster. It is equally important to stop deploying funds in areas of poor governance,” said Bhadkamkar.

Taking cue from Bhadkamkar, Shesh Kulkarni, President & CEO, UFMI also stressed on the manufacturing sector. “The Finance Minister and Government should have been leading some of the improvements for manufacturing industry, particularly automotive manufacturing long back. The key to every economy is the health of the manufacturing industry, while they have done a few things, but with General Elections around the corner, one is not sure how much the new government will adopt,” he underlined.

Kulkarni hopes that the new government will focus on the fundamentals and will priorise the manufacturing industry, followed by focus on the tax structure and then focussing on other sectors. “Hopefully, India will have a Goods and Services Tax (GST) in place, and focus on improving conditions of the road, airports, seaport, and recognise logistics as an industry by giving it an industry status,” he emphasised.

Major ContributorsAreef Patel, Executive Vice Chairman,

Patel Integrated Logistics, observed that three major contributors for the growth of the logistics industry are: the emergence

of organised retail, increase in foreign trade and India soon becoming the manufacturing hub.

“The Government should start working on the GST implementation fast. This would help in faster clearance and movement of goods from one state to another, as the differential state-level taxes are causing higher unit and inventory carrying costs,” Patel said. The uniform GST is expected to significantly reorganise the warehousing system in the country which will enable faster movement.

In his opinion, the implementation of GST will reduce the logistics cost in India which are currently approx 13 per cent of GDP. The Indian logistics cost – which includes inventory holding, transportation, warehousing, packaging, losses and related administration costs – will come down drastically, if GST is implemented properly. Also, if the infrastructure bottlenecks are reduced, then the industry will have a positive impact in terms of faster movement, inventory management which will ultimately lead to reduction in logistics cost.

SL SharmaPresident

ACAAI

Shantanu Bhadkamkar Immediate Past-Chairman

FFFAI

Shesh KulkarniPresident & CEO

UFMI

Areef PatelExecutive Vice Chairman Patel Integrated Logistics

The Government should start working on the GST implementation fast as it would help in clearance of goods faster from one state to another, as the differential state-level taxes are causing higher inventory carrying costs

Cover StoryIndustry Expectations

G BalarajuMD

Sindhu Cargo Services

Peter H JayakumarDeputy CFOGATI-KWE

Sunil KohliMD

Rahat Cargo

Harpreet Singh MalhotraMD

Tiger Logistics India

WWW.CARGOTALK.IN

Industry StatusG Balaraju, MD, Sindhu Cargo Services

said, “Being a vote on account budget, nothing much was expected. However, a reduction in excise duty for automobiles, electronic and capital goods has given little relief to the sectors which are under huge pressure. Let’s hope the new government at the centre follows the suit.”

He added, “We do expect policies to boost infrastructure. The new government should ensure they give attractive schemes for infrastructure developments, rather than a give a reduction in tax which will have a long-term impact. Reduction of rate of duty on heavy vehicles, like construction machinery, trucks, lorries and other fleets will enable us to compete with the recession. Also we look forward for industry status for our sector, reduction in service tax and concessional rate of bank interest.”

Road, Rail and Port Infrastructure

According to Peter H Jayakumar,

Deputy CFO,

GATI-KWE, Major focus needs to be on aggressive development of road, rail and port infrastructure. Further work needs to be done on simplification of indirect taxation. Jayakumar felt that clarity must be provided to reinstate foreign investor confidence into India to promote manufacturing and development of infrastructure. The interim budget supports a position by the government to increase manufacturing for export. Indirect taxation rationalisation and smoothening export processing will be required to improve India’s position as a preferred manufacturing destination. FDI in e-Commerce should be allowed, but funds not to be used for in-house logistics. Foreign investment in this sector should be used to support growth of public logistics capability and not within specific companies as captive capacity. He also urged for tax benefits for India’s cold chain infrastructure players. “Scope of Sec 35 AD should be expanded to include New Capex by business established prior to April 2009 also,” he advocated.

Tax SopsSunil Kohli, MD, Rahat Cargo

maintained that the finance minister’s interim budget proposals have

been quite encouraging for the nation as he has projected a

GDP expansion in the third and fourth

quarters of 2013-14 estimated at 5.2 per cent. Growth for the whole year is expected at 4.9 per cent.

He also pointed out that the growth of merchandise exports was seen at $326 billion in 2013-14, up 6.3 per cent year-on-year. Whereas, the agriculture exports are expected to touch $45 billion in 2013-14, up from $41 billion in 2012-13. The projections on forex reserves to rise by $15 billion by the end of 2013-14 has also been a welcome news. However, Kohli expects some tax sops from the ensuing government at the centre. “We expect to bring reforms of the Direct Tax Code (DTC) and implementation of the GST, which would undoubtedly be a game-changer, boosting long-term economic growth, creating a common market within the country, increasing compliance and raising aggregate revenues,” he stressed.

Incentives for MSMEs “When there is more manufacturing

of goods, it means the demand for the services will be raised. Therefore, the recently announced interim budget has brought the favourable wind for the manufacturing industry resulting in low cost goods, which will further create robust demand in public, which will in turn provide a huge volume-based business to the logistics players,” argued Harpreet Singh Malhotra, MD, Tiger Logistics India.

However, since the interim budget is wholly inclined towards manufacturing industry, there is visible absence of the benefits for MSMEs. “This is one of the major concern for us and there should be some tax reliefs for logistics companies who are specially engaged in providing various solutions under one roof,” said Singh, voicing serious concerns that need to be looked after by the new government.

26 I CARGOTALK I APRIL 2014


According to CMR’s India Monthly Mobile Handsets Market Review, CY 2013, February 2014 release, India recorded 247.2 million mobile

handset shipments for CY (January-December) 2013. During the same period, 41.1 million smartphones were shipped in the country. A comparison of overall mobile handset shipments for CY 2013 and Q4 2013 showed similar ranking for the top three players.

According to Panjwani, mobile phone shipments in Q4 2013, witnessed a two per cent Q-o-Q and 16 per cent Y-o-Y growth. The feature phone market saw a two per cent decrease in shipments over Q3 2013, while the smartphone market in India grew by close to 18 per cent Q-o-Q.

According to IDC Worldwide Quarterly Mobile Phone Tracker report, smartphone shipments to India are forecast to rise to 155.6 million units in 2017 from 27.8 million now, accounting for a 10.3 per cent share of the global market, just behind China’s projected 30.2 per cent share and the US’s 12.1 per cent.

The report also pointed out that India currently ranks sixth in the mobile

smartphone market, with a global market share of 3 per cent; China has a 32.8 per cent share and the US 15 per cent. India’s smartphone market is expected to grow sharply because of a variety of factors, including greater availability of low-cost devices and emphasis on less populous regions. In addition, expansion of 3G network coverage and the rollout of 4G networks are expected to boost smartphone sales in the country.

The report unveiled that India’s Year-on-Year smartphone shipment growth is expected to be the highest among the top countries—China, US, UK, Japan and Brazil—in the list as a majority of the country’s mobile phone users currently use regular feature phones.

Smartphones drive demand

We expect the share of feature phones to slump further, with international

and local vendors launching smartphones at relatively

lower price points.” Jitender Panjwani

Head Supply Chain for India Operations, Micromax

According to a CMR India research, more than 247 million mobile handsets were shipped in India during the year 2013, with a Y-o-Y growth of 11.6 per cent. Over 70 million mobile handsets were shipped in the fourth quarter of 2013 alone. Smartphone shipments crossed 41 million units, with a Y-o-Y growth of 172.2 per cent. Jitender Panjwani, Head Supply Chain for India Operations, Micromax elaborates on the opportunities and challenges for logistics companies.

RATAN KR PAUL

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Globally, smartphone shipments are forecast to edge out feature phone shipments in 2013 for the first time, with vendors expected to ship 918.6 million smartphones this year, or 50.1 per cent of the total mobile phone shipments worldwide. According to the report, top local vendors such as Micromax and Karbonn have been trying to make a conscious shift to smartphones over the past few quarters; however, the share of feature phones still remains dominant in terms of shipment volume.

“2013 was primarily the year of smartphones for the India market, particularly for local handset vendors. A first for the India market was a marginal decline in featurephone shipments on a year-on-year basis. This trend is likely to continue with more vendors focussing on entry-level smartphone offerings aimed at the consumer segment,” said Tarun Pathak, Lead Analyst, Devices, CMR Telecoms Practice.

He also underlined that nearly 70 vendors operated in the highly competitive India smartphones market in the year 2013, with ‘Tier One’ brands like Apple, Samsung, Nokia, Sony, HTC, LG and Blackberry capturing close to 53 per cent of the total smartphones market, followed by Indian

brands capturing close to 43 per cent of total smartphone

shipments. The remaining market of roughly four per cent

smartphone shipments

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few more players are expected to

enter the India market directly,

instead of continuing as ODM partners to

Indian brands.

“We expect the share of feature phones in the overall phone market to slump further, with international and

local vendors launching smartphones at relatively

lower price points. The narrowing price gap between feature phones and smartphones is one of the biggest drivers of smartphone adoption in a price-sensitive market like India,” said Panjwani.

He highlighted that in India the smartphone market almost tripled Y-o-Y in Q4 2013 with shipment volumes reaching 15.05 million units. “The average selling price (ASP) of a smartphone has come down from US$215 in Q4 2012 to US$163 in Q4 2013. This lowering of ASP is one of the biggest drivers of smartphone adoption in India,” he pointed out.

Market survey reveals that Micromax holds on to its second spot with about 16 per cent in terms of market share. The top selling models were the Bolt series and Micromax Bolt A67. On the other hand, Android will continue to remain the dominant OS in the market, owing to the growing low cost smartphones segment. Windows Phone 8 OS has seen an icrease in Q-o-Q and the trend is expected to continue in the coming quarters - with Nokia planning to launch Lumia devices

and covering the entire price spectrum.

SCM ChallengesAccording to Panjwani, supply

chain management (SCM) is always a challenging area to work and do something innovative. Since, the market is changing their expectations from quantity to quality (from feature phones to smartphones), the dynamics have changed for material supply.

“Today, the customers are all over, we can’t say that mobiles will be used only by

The narrowing price gap between the feature phones and smartphones is one of the biggest drivers of the smartphone adoption in a price-sensitive market like India

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Table 1. India Mobile Handsets Market: CY 2013 versus CY 2012(in terms of unit shipments)

Table 2. India Mobile Handsets Market: Leading Players - CY 2013 and 4Q 2013 (% of unit shipments)

Form Factor Shipments Shipments Year-on-Year Growth, CY (CY 2012) (CY 2013) 2013 over CY 2012 (%)

Mobile Handsets 221.6 247.2 11.6%

Featurephones 206.5 206.1 -0.2%

Smartphones 15.1 41.1 172.2%

Player Rank-Overall Share-Overall Rank-Overall Share-Overall CY 2013 (% of unit 4Q 2013 (% of unit shpments) shipments CY 2013 4Q 2013

Nokia #1 18.9% #1 16.6%

Samsung #2 13.8% #2 15.6%

Micromax #3 10.3% #3 11.6%

Source: CMR’s India Monthly Mobile Handsets Market Review, CY 2013,February 2014 release

Source: CMR’s India Monthly Mobile Handsets Market Review, CY 2013,February 2014 release


‘A’ towns. Considering, the affordability of Micromax phones, the phones reach to all parts of the country. However, the challenging part in supply chain is the limited infrastructure in cities other than ‘A’ class cities,” he said.

In his opinion, search for appropriate partner of logistics is always in demand, irrespective of domestic or international logistics. “Since the vertical of telecom is growing fast, we can expect changes in areas. It’s ‘about taking chances’. The domestic market logistics companies must focus more on the regional level set-ups. “Today, in logistics field, we have more organisations focussing on national level and there are limited companies focussing on regional, district and village-level supply chain. The new growth / demand for business would come from B & C towns followed by local connections. Apparently, this is a niche market or in other words a target market for the coming years,” he observed.

Panjwani maintained that since the market have grown in B & C towns and consumers can buy the phones at affordable prices, the expectations from supply chain have evolved from minimum to maximum, near to far off places.

Apparently, the connectivity is

limited. However, to make material reach in shorten lead time, it is really essential to have focused service providers to invest in these towns for better transportation. Today, the focus is only on connectivity and not on the material handling conditions, customer centric approach, customised vehicles at lower cost and product-centric approach. “These changes in view would certainly change the handset-selling company’s market share and also would open a new vertical of growth to service providers & transporters for a decade to come,” he pointed out. He also feels that in the domain of supply chain, there are a lot of

tangible / intangible factors involved to meet expectations of the industry. “Sharing information on time enables your customers to plan their work area. But, these days, right communication and information at the right time, to plan your space in market is essential,” he stressed.

“It is really good to work with professional companies and let them manage your pain areas well. Any organisation can be professional provided they pay attention to the customer needs and work towards customer satisfaction. Then the size of organisation really doesn’t matter,” Panjwani concluded.

Lead StoryMarket Trends

Player Rank- Share- Rank- Share- Smartphone Smartphone Smartphone Smartphone CY 2013 (% of unit 4Q 2013 (% of unit shpments) shipments) CY 2013 4Q 2013

Samsung #1 37.0% #1 40.4%

Micromax #2 18.6% #2 15.7%

Karbonn #3 10.1% #3 11.1%

Table 3. India Mobile Handsets Market: Leading Smartphone Players, CY 2013 & 4Q 2013 (in terms of % of unit shipments)

Source: CMR’s India Monthly Mobile Handsets Market Review, CY 2013, February 2014 release

R ecently, DHL unveiled new vehicle models in India and abroad to

support Original Equipment Manufacturers (OEMs). In view of the fact that most logistics companies focus on inbound to manufacturing and after-sales logistics, the company sources maintained that DHL’s product comprises the entire go-to-market process.

Meanwhile, the company’s four business units in India, DHL Express, DHL Global Forwarding, DHL Supply Chain and Blue Dart have developed

different logistics modules together, which customers can combine or implement individually.

According to Fathi Tlatli, President Global Sector Automotive, DHL Global Customer Solutions & Innovation the DHL sources, with new product launches in the automotive sector becoming increasingly complex and cost-intensive, DHL - Blue Dart’s focussed automotive solution will benefit companies from minimised supply chain risks,

lower third party costs, higher efficiency and visibility. “The average time from the first sketch of a car to market entry is 2-3 years and requires precise synchronisation amongst several involved parties, more often, not located even in the same continent,” he said.

The new service focusses on three stages of vehicle evolution and marketing: In the research and development phase—DHL - Blue Dart support shipment of pre-production models by offering specialised packaging of prototypes, customs process management and transportation with high security and confidentiality.

New Launch

DHL introduces new vehicle for OEMs

Fathi Tlatli President Global Sector Automotive, DHL Global Customer Solutions &

Innovation the DHL sources


Trade OpportunitiesNew Launch

The Dubai Export Development Corporation (Dubai Exports) provides exporters with services required to enter new markets and expand in

existing overseas markets. Dubai Exports also undertakes an advocacy role for exporters on their relations with governments and other relevant agencies, through the formation of long-term and mutually beneficial partnerships.

According to Al Awadi, the Middle East and Asia are some of the most promising regions for trade with the UAE on a short-term basis. This trend is set to continue in the long term, with fast-growing areas displacing advanced economies as the UAE’s most important trading partners.

“With the opening of the India office, we aim to provide on-the-ground services to firms in the UAE to connect with their counterparts in India. We also want to increase the awareness of UAE-based products and services in the Indian market. An important part of this is to provide a single point of contact for Indian companies wishing to source from the UAE,” said Al Awadi.

Dubai Exports opens

Dubai Exports has recently opened its office in Mumbai to promote exports from Dubai to India and utilise Dubai as a transit hub for Indian exports across the world. Cargotalk speaks to Saed Mohamed Al Awadi, CEO, Dubai Export Development Corporation and MD and CEO, Export Credit Insurance Co. of Emirates, on the objectives of the organisation and trade ties between the two countries.

The Indian office aims to provide on-the-ground services to firms in the UAE to connect with their counterparts in India

Re-exports 27% Imports

60%

Exports 13% Dubai’s

Trade Make-Up


The Indian office of Dubai Exports will help to overcome the inherent weaknesses of importers to connect with small and medium sized firms (SMEs) who usually do not have an overseas representative office. It is pertinent to mention that various types of trade barriers act as a disincentive to exporters to enter a particular market for sourcing.

Trade Opportunities between India and UAEAccording to Al Awadi, trade relations between the UAE and India are extremely strong and Dubai exports over a third of its products to India. “We see considerable potential for our firms seeking to export to India in various sectors, from food and beverages to Islamic financial services. In the case of the former, we participated at the Food Grocery Forum India in January 2014 and found that our goods received extremely

encouraging response. Goods from the UAE are highly price competitive and meet global standards and as such they have a natural market in the growing Indian economy,” he said.

He added, “We feel that the economic and entrepreneurial dynamism in the country opens the door to our firms to partner and work with counterparts in India. Through, our presence in India, we have been supporting UAE firms as well as connecting Indian companies with their counterparts in the UAE. Dubai Exports is leading the Halal Manufacturing and promotion aspects.“

Assistance to Indian ImportersDubai Exports has developed the Buyer Programme, which is a unique solution that assists firms in India to connect with suppliers from the UAE in an efficient and cost effective manner. Dubai Exports

has also developed the investment for re-export programme which is a unique solution that assist Indian firms to export to the wider region using Dubai as their hub. Another objective is to export from Dubai initiative which helps companies to establish themselves in the Emirate and take advantage of the many opportunities that it has, especially in the manufacturing sector.

Al Awadi underlined that Dubai has been very successful in attracting global businesses in a diverse range of sectors. “Dubai has a very favourable business environment, with no direct taxes on corporate profits or personal income. Customs duties in Dubai are low - at five per cent. It has an advantageous geographical location, a stable economy and a gateway to over 1.5 billion potential consumers with a relatively high disposal income,” he said. He also maintained that Dubai has excellent logistics infrastructure with the world’s sixth largest port served by over 85 shipping lines connecting the Emirate with all major ports. Also, the Emirate is serviced by over 120 airlines connecting it with almost every country in the world.

Dubai as a re-export hubAl Awadi adds, “We believe that Dubai has privileged access to sourcing markets and target markets (as a halfway point between Asia, Africa, Europe, Middle East). At the same time it is home to the sixth largest port in the world and the second largest airport. As such Dubai has an excellent logistics infrastructure and is the third largest re-export hub in the world. Therefore, it is natural for companies from India to base their global re-export operations in Dubai, so that they can be integrated into the global marketplace. Also, there are a number of financial reasons as to why Indian companies may choose to base their export activities from Dubai such as the fact that the UAE is a member of the Greater Arab Free Trade Agreement and it has signed free trade agreements with Singapore and EFTA is part of the GCC customs union.

Dubai Exports has an extensive plan to carry out a number of initiatives and programmes to strengthen the trading ties between the UAE and Dubai and the organisation is currently working with a number of business groups and associations on the same.

India 36%

Other 36%

Other28%

Kuwait 3%

Hong Kong2%

Thailand 2%

Switzerland 15%

Saudi Arabia 4%

Iran4%

Singapore 3%

Turkey 3%

Dubai’s Major Export Partners (Non-Oil)

Dubai Total Re-Exports

350

129 118144

320 334

300

250

200

150

100

50

02007 2008 2009 2010 2011 2012

101


DELHI INTERNATIONAL AIRPORT CARGO DEPARTMENT, IGI AIRPORT, NEW DELHI

(AIRLINE-WISE IMPORT/EXPORT CARGO PERFORMANCE FOR THE MONTH OF FEBRUARY 2014)

Total 15944 2598 18542 11210 29752 100.00%Cargo handled in February ‘13’ 13921 2304 16224 11655 27879 % VARIATION 14.53% 12.77% 14.28% -3.82% 6.72%

1 Emirates 1086 1114 2200 723 2923 9.82%2 Jet Airways 1046 153 1199 1217 2416 8.12%3 Air India 1147 240 1387 750 2137 7.18%

5 Singapore 647 38 685 779 1464 4.92%6 British Airways 832 72 904 514 1418 4.77%7 Etihad Airways 582 109 691 470 1161 3.90%8 Lufthansa Cargo Airline 520 74 594 519 1113 3.74%9 Thai Airways 314 33 347 732 1079 3.63%10 Air France 601 20 622 390 1011 3.40%11 Fedex Express Corpation 592 13 605 389 994 3.34%12 Qatar Airways 475 133 608 375 982 3.30%13 Kalitta Air 524 0 525 349 874 2.94%14 Uzbekistan 503 57 559 246 805 2.71%15 Turkish Airlines 588 8 597 198 795 2.67%16 Swiss Intl Airline Ltd 426 17 442 297 740 2.49%17 Japan Airlines 251 8 259 418 677 2.28%18 Malaysian Airline System 336 11 347 277 624 2.10%19 KLM 338 21 359 174 533 1.79%20 M/S All Nippon Airways 425 13 438 96 533 1.79%21 Virgin Atlantic 298 0 298 202 500 1.68%22 Hercules Aviation 425 4 429 0 429 1.44%23 Saudia 187 149 337 25 361 1.21%

25 United Airlines 249 9 259 76 335 1.12%26 Finnair 203 0 203 123 326 1.09%27 China Eastern Airlines 181 2 183 131 313 1.05%28 Lufthansa Cargo Ag 127 22 149 117 266 0.89%29 Air China 98 2 100 120 220 0.74%30 Indigo Cargo 149 0 149 63 212 0.71%31 Spice Jet 110 0 110 96 206 0.69%32 China Air 137 0 137 53 189 0.64%33 Martin Airline 87 0 87 98 185 0.62%34 Air Arabia 152 0 152 4 157 0.53%35 China Southern Airlines 108 0 108 33 141 0.48%36 Oman Air 89 30 119 1 120 0.40%37 Blue Dart 91 0 91 23 114 0.38%38 DHL Express 0 0 0 114 114 0.38%39 Mahan Air 92 2 94 13 107 0.36%40 Ethopean Airlines 73 3 76 24 100 0.34%41 Gulf Air 67 25 92 3 95 0.32%42 Ariana Afghan Airlines 82 0 82 9 91 0.31%43 Aerologic 90 0 90 0 90 0.30%44 Air Shagoon Pvt. Ltd. 80 0 80 3 83 0.28%45 Asiana Airlines 66 0 66 7 73 0.25%46 Sri Lankan Airlines Ltd 49 0 49 21 70 0.24%47 Kam Air 8 0 8 58 65 0.22%48 Air Mauritius 57 4 61 2 63 0.21%49 Flywell Aviation Pvt. Ltd 0 53 53 0 53 0.18%50 Kuwait Airlines 2 35 37 6 43 0.15%51 Air Astana 32 9 41 2 42 0.14%52 Kenya 19 0 19 5 25 0.08%53 UPS 0 0 0 14 14 0.05%54 Turkmenisthan Airlines 7 7 14 0 14 0.05%55 Biman Bangladesh 10 0 10 2 12 0.04%56 Royal Jordanian Airlines 12 0 12 0 12 0.04%57 Tajik Air 5 6 12 0 12 0.04%58 Pakistan International 7 0 7 3 10 0.03%59 Jetlite 0 0 0 6 6 0.02%60 Iraqi Airways 2 0 2 0 2 0.01%61 Druk Air 1 0 1 0 1 0.00%

S. No. Airlines Export With- Export Export with Import Total Cargo % Out Peri- Perishable Perishable (MTs) (MTs) of Total shable (MTs) Cargo (MTs) (UPL) (MTs)

Cargo Performance Export/Import


EXPORT & IMPORT CARGO TONNAGE HANDLED AT CSIA FOR THE MONTH OF FEBRUARY 2014

(FREIGHT IN METRIC TONNE)

1 Emirates 3045 1589 46342 Jet Airways 2278 2086 43643 Lufthansa Airlines 1203 1834 30384 Air India 1859 810 26705 Etihad Airways 1172 1137 23096 Singapore Airlines 1083 1017 2100

8 Qatar Airways 1112 859 19729 British Airways 1116 532 164810 Turkish Airlines 615 432 104711 Federal Express 752 240 99212 Saudi Arabian Airlines 813 120 93213 Delta/KLM/Martin Air 418 468 88614 Ethopian Airlines 826 9 83515 Swiss Intl. Airlines 429 384 81316 Thai Airways 333 476 81017 Air France 500 265 76518 Malaysia Airlines 416 267 68319 Virgin Atlantic 284 269 55220 UPS 181 282 46321 Kuwait Airways 282 179 46122 Kenya Airways 329 5 335

S. N. Airlines Export Import Total S. N Airlines Export Import Total23 South African Airlines 281 8 28924 Indigo Air 207 39 24625 Gulf Air 205 31 23626 Aerologic 0 207 20727 Air Arabia 166 39 20528 Oman Air 145 50 19529 Blue Dart 70 123 19230 Korean Air 98 71 16931 United Airlines 63 98 16232 Air Mauritius 153 4 15733 EL-AL Airlines 92 51 14334 Srilankan Air 70 58 12835 Spice Jet 61 11 7236 Bangkok Airways 58 8 6637 Iran Air 56 1 5638 Yemenia Airways 49 0 4939 Pakistan intl Airlines 26 0 2640 Royal Jordanian 16 1 1741 Egypt Air 9 3 1242 Air China 10 1 1143 Others 6 75 81 Total 22151 14960 37110


(E) Other Airports 160 105 52.4 1205 1240 -2.8 Grand Total 73965 66991 10.4 623009 595293 4.7 (A+B+C+D+E)

TRAFFIC STATISTICS D O M E S T I C F R E I G H T

(A) 16 International Airports

(B) 6 JV International Airports

(C) 7 Custom Airports

(D) 17 Domestic Airports

16 Delhi (DIAL) 20016 16191 23.6 158256 143293 10.4 17 Mumbai (MIAL) 15403 15568 -1.1 136629 138067 -1.0 18 Bangalore (BIAL) 8061 6965 15.7 68697 62467 10.0 19 Hyderabad (GHIAL) 3380 2896 16.7 27621 25173 9.7 20 Cochin (CIAL) 870 773 12.5 7096 6679 6.2 21 Nagpur (MIPL) 464 422 10.0 3850 3652 5.4 Total 48194 42815 12.6 402149 379331 6.0

22 Pune 2054 1669 23.1 15619 15075 3.623 Visakhapatnam 95 91 4.4 1239 1016 21.924 Patna 452 219 106.4 3435 1571 118.725 Chandigarh 277 198 39.9 2586 2050 26.126 Bagdogra 226 108 109.3 1525 1003 52.027 Madurai 112 121 -7.4 923 733 25.9 Total 3216 2406 33.7 25327 21448 18.1

28 Bhubaneswar 382 306 24.8 2909 2406 20.929 Indore 463 504 -8.1 3344 3495 -4.330 Jammu 153 138 10.9 1276 1101 15.931 Raipur 302 144 109.7 2403 1812 32.632 Agartala 454 482 -5.8 5090 4469 13.933 Vadodara 205 152 34.9 1530 1533 -0.234 Imphal 333 259 28.6 3072 3100 -0.935 Bhopal 62 70 -11.4 631 740 -14.736 Ranchi 208 56 271.4 1798 1127 59.537 Aurangabad 96 64 50.0 627 594 5.638 Leh 91 125 -27.2 819 930 -11.939 Tirupati 0 0 - 0 16 -100.040 Rajkot 12 40 -70.0 130 215 -39.541 Jodhpur 1 1 0.0 15 16 -6.342 Dibrugarh 17 29 -41.4 210 239 -12.1 Total 2779 2370 17.3 23854 21793 9.5

Freight (in Tonnes) For the Month For the period April to DecemberS. No. Airport December 2013 December 2012 % Change 2013-14 2012-13 % Change

1 Chennai 6108 6694 -8.8 53931 59472 -9.32 Kolkata 7077 6954 1.8 63166 61148 3.33 Ahmedabad 3274 2879 13.7 26911 26654 1.04 Goa 294 272 8.1 1902 2204 -13.75 Trivandrum 119 138 -13.8 1441 1112 29.66 Calicut 10 48 -79.2 126 241 -47.77 Guwahati 670 474 41.4 5230 4657 12.38 Lucknow 307 303 1.3 2262 1643 37.79 Srinagar 251 233 7.7 2888 2459 17.410 Jaipur 682 549 24.2 5418 5121 5.811 Coimbatore 440 458 -3.9 4600 4719 -2.512 Mangalore 17 25 -32.0 221 219 0.913 Amritsar 18 4 350.0 94 72 30.614 Varanasi 29 19 52.6 324 254 27.615 Portblair 320 245 30.6 1960 1506 30.1 Total 19616 19295 1.7 170474 171481 -0.6

Cargo Performance Airports in India


TRAFFIC STATISTICS I N T E R N AT I O N A L F R E I G H T

15 Delhi (DIAL) 31888 30516 4.5 290905 266625 9.1 16 Mumbai (MIAL) 38730 35754 8.3 348561 343168 1.6 17 Bangalore (BIAL) 12283 12165 1.0 112324 106905 5.1 18 Hyderabad (GHIAL) 4486 4323 3.8 36941 34332 7.6 19 Cochin (CIAL) 3215 2757 16.6 30977 28296 9.5 20 Nagpur (MIPL) 43 30 43.3 297 294 1.0 Total 90645 85545 6.0 820005 779620 5.2

21 Pune 0 0 - 10 0 -22 Madurai 1 0 - 1 0 - Total 1 0 - 11 0 -

(B) 6 JV International Airports

(C) 7 CUSTOM AIRPORTS

(A) 16 International Airports

Freight (in Tonnes) For the Month For the period April to DecemberS. No. Airport December 2013 December 2012 % Change 2013-14 2012-13 % Change

(C) 17 Domestic Airports 0 0 - 0 202 - Grand Total (A+B+C) 118353 113298 4.5 1079436 1063311 1.5

1 Chennai 17541 18904 -7.2 167401 183337 -8.7 2 Kolkata 3584 3315 8.1 33989 32425 4.8 3 Ahmedabad 1128 1105 2.1 12038 9444 27.5 4 Goa 230 334 -31.1 1404 1643 -14.5 5 Trivandrum 2952 1892 56.0 20938 31734 -34.0 6 Calicut 1640 1689 -2.9 17086 20336 -16.0 7 Guwahati 1 5 -80.0 11 12 -8.3 8 Lucknow 115 59 94.9 848 946 -10.4 9 Jaipur 31 10 210.0 174 131 32.8 10 Coimbatore 93 51 82.4 734 417 76.0 11 Mangalore 13 0 - 45 0 - 12 Amritsar 26 151 -82.8 1307 1166 12.1 13 Trichy 353 237 48.9 3445 1891 82.2 14 Varanasi 0 1 -100.0 0 7 -100.0 Total 27707 27753 -0.2 259420 283489 -8.5

Cargo Performance Airports in India

Total % Change Total % Change

AIRPORT-WISE WORLD’S CARGO TRAFFIC FOR PAST 12 MONTHS 12-MONTHS ENDING DEC 2013, CARGO VOLUME - LOADED AND UNLOADED FREIGHT AND MAIL IN METRIC TONNE

Last update : March 17, 2014

1 HONG KONG, HK (HKG) 4 156 083 2.22 MEMPHIS TN, US (MEM) 4 137 938 3.03 SHANGHAI, CN (PVG) 2 928 527 (0.4)4 INCHEON, KR (ICN) 2 464 382 0.35 DUBAI, AE (DXB) 2 435 573 7.46 ANCHORAGE AK, US (ANC) 2 418 762 (1.8)7 LOUISVILLE KY, US (SDF) 2 216 079 2.28 FRANKFURT, DE (FRA) 2 094 607 1.49 TOKYO, JP (NRT) 2 019 844 0.710 MIAMI FL, US (MIA) 1 945 013 0.811 PARIS, FR (CDG) 1 884 384 (3.3)12 SINGAPORE, SG (SIN) 1 863 332 (0.4)13 BEIJING, CN (PEK) 1 839 665 2.514 LOS ANGELES CA, US (LAX) 1 744 101 (1.4)15 TAIPEI, TW (TPE) 1 571 814 (0.4)

16 AMSTERDAM, NL (AMS) 1 565 961 3.617 CHICAGO IL, US (ORD) 1 527 655 0.418 LONDON, GB (LHR) 1 515 054 (2.6)19 GUANGZHOU, CN (CAN) 1 309 746 4.920 NEW YORK NY, US (JFK) 1 286 561 0.921 BANGKOK, TH (BKK) 1 236 221 (8.1)22 INDIANAPOLIS IN, US (IND) 991 953 6.423 TOKYO, JP (HND) 950 619 4.524 SHENZHEN, CN (SZX) 913 472 6.925 DOHA, QA (DOH) 883 272 4.626 LEIPZIG, DE (LEJ) 878 023 3.827 COLOGNE, DE (CGN) 717 143 (1.8)28 ABU DHABI, AE (AUH) 712 488 24.129 KUALA LUMPUR, MY (KUL) 706 928 0.730 OSAKA, JP (KIX) 682 338 (5.6)


Indian Chamber of Commerce recently organised the Fourth Edition of Indian Supply Chain Logistics Summit & Excellence Award 2014 in New Delhi.

After thorough evaluation, by jury panel and knowledge partner Deloitte,

which included all technical, infrastructural, procedural details as well as keeping in view the user’s perspective, a number of logistics service providers were conferred at this event for their commendable performance. Major winners are:

ICC awards for logistics fraternity Celebi Delhi Cargo Terminal

Management India and AI Sats, Bangalore ‘Air Cargo Terminal Operator of the Year’

Celebi Delhi Cargo Terminal Management India ‘Green Logistics Provider of the Year’

Drive India Enterprise Solution Limited (DIESL)

Kale Logistics

Provider of the Year’

Gati-KWE Best Road Transport

Success & AchievementsBest Performance

C athay Pacific Airways on March 12, 2014, announced its fresh Delhi schedules to offer double daily non-

stop flights to Hong Kong, effective March 31, 2014. The first flight from Delhi arrives at Hong Kong International Airport at

0700 and the second flight at 0925, giving seamless connections to destinations such as North America, Australia, Japan, Korea, China and the Philippines offered by Cathay Pacific and its sister airline, Dragonair. Both non-stop services are operated by Cathay

Pacific’s fleet of A330 aircraft. Addressing a press conference in New

Delhi Cathay Pacific officials also unveiled the performance of the airline for the year 2013. The Group’s cargo revenue in 2013 was HK$23,663 million, a decline of 3.6 per cent compared to the previous year. Yield for Cathay Pacific and Dragonair decreased by 4.1 per cent to HK$2.32. Capacity increased by 1.7 per cent but the load factor fell by 2.4 percentage points to 61.8 per cent. Capacity was adjusted in line with demand throughout 2013 and more cargo was carried in the bellies of passenger aircraft in order to reduce costs.

The facts show the Group’s cargo business has been adversely affected by weak demand since April 2011. There was some recovery in business during the last three months of 2013, though business was still weaker than the same period of 2012. The airline’s new cargo terminal at Hong Kong International Airport became fully operational in October 2013 and will allow the Airline to improve efficiency and to reduce costs in the long term.

Airline News

Cathay Pacific to double daily flights from Delhi to Hong Kong


AMTOI Day in Bollywood StyleThe Association of Multimodal Transport Operators of India (AMTOI) celebrated its Annual Day on March 7, 2014 in Mumbai with trademark grandeur and style of AMTOI. The theme of the Day was ‘Bollywood’. The majors of Indian maritime community & AMTOI displayed solidarity & togetherness making it one of the most sought-after events in the industry.

AAMMTTO

Anniversary

Family AlbumAssociations

APRIL 2014 I CARGOTALK I 41

nts iin ththe inndudud stststs rryry.


Family AlbumClub Function

AIR CARGO CLUB

ACCD ‘Ball 2014’ warms up the chilled ambienceIt was a spectacular and hot evening under an open sky

and despite very cold weather in Delhi, thanks to the

meticulously hosted Annual Ball of the Air Cargo Club of

Delhi (ACCD). The event was attended by over 750 people

of the air cargo fraternity from across the country. The Ball

was full of entertainment with fantastic performances by

two renowned dance troupes from India and abroad. In

addition, there were over 30 lucky draws sponsored by

various airlines and forwarding companies.


AIR CARGO CLUB


Family AlbumIndustry Event

AwardFunction

AMSC Summit & Awards boost service providers

The 3rd Asia Manufacturing Supply Chain Summit

(AMSCS), held recently in Mumbai, with the

theme ‘Transformers: Supply Chain 3.0’, featured

50 speakers from across industries. Around

250 industry leaders & practioners from SCM &

Manufacturing community attended the Summit.

The AMSC Summit also featured an exhibition

area for the supporting companies. At this event,

the AMSC Awards were presented by Future

Supply Chain Solutions.

44 I CARGOTALK I APRIL 2014


ACCMmembers meet at Annual BallThe Annual Ball of the Air Cargo Club of Madras (ACCM) provided an opportunity to its members and their spouses to experience a gracious event mingled with dance and music. Many participants from the air cargo fraternity received fabulous gifts from lucky draws sponsored by industry players.

Family AlbumClub Function

I

ACCM

AnnualEvent


In his inaugural address Capt AK Kaura, President, NISAA said that converting cargo from rail to road is a big challenge in this region because

of multiple factors viz. poor hinterland connectivity, various agencies involved at ICDs resulting in delay in clearance of cargo and increase in transaction cost. He suggested that apart from strengthening the hinterland and last mile connectivity, there should be regular performance audit of ICDs, availability of monthly data of volumes handled by ICDs, e-communication, uniform system and policy and introduction of double stack-containers and proper utilisation of empty space to reduce cost. The Forum was also addressed by Raghu Dayal, former and Founder MD of Concor and several other industry experts and practitioners.

Dayal highlighted the key issues which are creating bottlenecks in transportation of goods from north India to the ports. He also underlined the poor road transport sector which carries the majority of cargo. He pointed out that the large volumes of freight is transported on Indian roads by an unorganised trucking industry. 75 per cent of trucking firms own small fleets of less than five trucks; only 11 per cent operate 20 trucks or more. Two-axle light

trucks dominate the narrow and badly maintained roads. Regulations prohibiting overloading of vehicles are poorly enforced. Small vehicle sizes and rampant overloading lead to trucking costs amongst lowest for bulk and heavy goods. On the other hand, cost for lighter products – electronics, pharmaceuticals, etc. is substantially higher. There is low penetration of tractor-trailer units, flat-bed trucks suitable for container, carriage, and specialised vehicles for refrigerated transport.

He also criticised the existing licensing regime and multiple check post system where trucks are stopped at multiple checkpoints for inspections, payments of tolls and taxes. “Vehicles moving on inter-state routes remain stationary about 40 per cent of the time in the process of being inspected. World Bank estimated truck delays at checkpoints cost the Indian economy about `2,300 crore per annum. These delays result in Indian trucks being used, on average, for about 60,000 to 100,000 kms per year, less than a quarter of that in the developed countries,” he pointed out.

Dayal firmly believes that for a

rebalancing of multi-modal transport system, road sector should be more efficient and less dominant. The focus should be on its advantages viz., its extensive reach, last mile superiority and flexibility to deliver smaller volumes. Accordingly, a strong combination of road and rail hold the keys behind the success of hinterland connectivity for ocean freight to and from North as well other parts of India.

Industry AssociationNISAA Forum

NISAA urges for hinterland connectivity to boost port servicesThe ‘NISAA Forum’ (North India Steamer Agents Association of India Forum) 2014, which was recently held in New Delhi raised several critical issues that create bottlenecks in transporting export-import cargo to and from Indian ports from/to north India, in particular.

Truck delays at checkpoints on inter-state routes result in Indian trucks being used, on average, for about 60,000-100,000 kms per year, less than a quarter of that in the developed countries

Dignatories at the dais addressing the NISAA Forum in New Delhi

Statement about ownership and other particulars about newspaper CargoTalk to be published in the first issue every year after the last day of February

1. Place of publication : 72 Todarmal Road, New Delhi - 110001

2. Periodicity of its publication : Monthly3. Printer’s Name : SanJeet Nationality : Indian Address : 72, Todarmal Road, New Delhi - 1100014. Publisher’s Name : SanJeet Nationality : Indian Address : 72, Todarmal Road, New Delhi - 1100015. Editor’s Name : SanJeet Nationality : Indian Address : 72, Todarmal Road, New Delhi - 110001

6. Name and address of individuals who own the newspaper and partners or shareholders holding more than one percent of the total capital: Durga Das Publications Pvt. Ltd. Shareholders: 1. Vikramajit, 2 B, Friends Colony, West, ND-65; 2. SanJeet, 72, Todarmal Road, New Delhi-1; 3. Sumati Jeet, 72, Todarmal Road, ND-1; 4. Urmila Vikramajit, 2 B, Friend Colony, West, ND-65

I, SanJeet, hereby declare that the particulars given above are true to the best of my knowledge and belief.

Date : 01/03/2014 Sd/-SanJeet

Signature of the Publisher

Form IV


Shipping & PortsOpinion / News in Brief

As the busiest gateway and hub in India, the Jawaharlal Nehru Port (Nhava Sheva), Mumbai has been constrained in the past owing to lack of facilities, which impacted

trade many a times. As per the agreement signed between JNPT and DP World, the latter has been awarded to build and operate a new 330 meter terminal to add

800,000 TEUs (twenty foot equivalent container units) of container capacity to the port, and help ease congestion, as the port is currently operating beyond capacity. DP World is investing US$200 million to build the terminal. The terminal will be operational by 2015. On March 5, 2014 GK Vasan, Minister of Shipping laid the foundation stone in presence of the Milind Deora, Minister of State for Shipping and Sultan Ahmed Bin Sulayem, Chairman DP

World, along with dignitaries from the Government of India, senior members of Jawaharlal Nehru Port Trust and DP World, and industry stakeholders. “The new terminal will serve India for generations to come and help speed goods to market, stimulating trade, contributing to economic growth, which in turn, contributes to the development of communities and individuals,” said Sultan Ahmed Bin Sulayem. According to Anil Singh, Senior Vice President & Managing Director, DP World Subcontinent for the last five years, India’s premier port has been in critical need of capacity with container trade rising. The building of greater capacity is part of the port’s long term vision. Nhava Sheva (India) Gateway Terminal will provide the immediate relief that the trade community urgently requires.

DP World to build new Terminal at JNPT, Mumbai by 2015

Strict, strong vigilance needed to stop cargo pilferage

Despite CCTV cameras and round-the-clock security, pilferage is not deterred. At least four out of ten containers stuffed in ICD are reported to arrive

with cartons opened and contents missing at destination ICD.

“If we really cannot blame the ICD authorities for not doing sufficient to curb such pilferages, there was another report a few days in a leading newspaper that there was a proper racket running their mischievous operations en route train lines from ICD to gateway ports. As and when, a container train would stop for a technical halt, they would swing into action and unscrew the whole container door with all seals

intact and make a quick attempt to grab whatever they can and then put the container doors back in original position,” pointed out GS Chawla, MD, Ocean King Shipping Services. He added,“It is high time that warehousing service providers understand that the state in which cargo arrives

the destination speaks in itself for the state of the warehouse in which it had been packed. When we get imports from UK, Europe or US, cargo comes in a perfectly packed pallets and just so perfectly stacked-in order, which in no way seem to have moved either way,” he underlined.

However, as in pictures attached of one of the containers that arrived at destination, it is often found that the original factory tapes have been cut open, contents removed, and cartons re-taped. “Warehousing authorities need to implement a strict and strong vigilance and completely ensure a zero tolerance zone in cargo holding areas. There should be no jaywalking, no unauthorised personnel, strict searching and full body pat-downs of one and all exiting the warehouse gates,” Chawla appealed.

GS Chawla, MD, Ocean King Shipping Services

Cargo handling procedures at Inland Container Depot (ICD) and Container Freight Station (CFS) for SEA business are in a very sorry state. On one hand, the shippers compromise too much on packing cost and on the other hand, theft and stealing of contents from the cartons is running at full swing inside ICD and CFS premises.

(L-R): GK Vasan, Milind Deora and Sultan Ahmed Bin Sulayem, at the inauguration of the ceremonial plaque for the new terminal


Civil AviationNew Initiatives

Kannan is heading the consultation procedure to give a final shape to the Civil Aviation Ombudsman. Ministry of Civil Aviation (MoCA) has decided

to consult stakeholders regarding setting up of an Ombudsman for Civil Aviation Sector in India as an alternative dispute settlement machinery. The word Ombudsman means an officer or spokesperson or representative of the people.

“It has been noticed that the disputes between service providers and users are increasing at the same pace as the growth of the aviation sector. Ideally, the grievances should be resolved instantly at the initial stage through the service providers’ grievance redressal mechanism. However, there are plenty of disputes which remain unresolved for a very long time. It is not desirable for the development of the aviation sector in India. As a result, MoCA has decided to take this crucial initiative, for fast settlement of any disputes through Ombudsman for Civil Aviation,” said Kannan.

Asked about the requirement of a separate mechanism like Ombudsman despite the presence of some other institutions like DGCA, AERA, CCI and Consumer Courts that too take care of users’ interests, Kannan maintained that each and every organisation has their core functions and limitations. On the other hand, redressal of disputes pertaining to civil aviation should be done by a specific and nodal body, which would cover all the stakeholders and allied organisations for fast settlement of any disputes. It is pertinent to mention that the country is experiencing desired results from Ombudsman, which already had been set-up for some other sectors like banking, insurance, income tax and electricity.

Significantly, the draft consultation paper which is now in the public domain for discussion has given adequate emphasis on the disputes between the industry stakeholders. Though the consultation paper has not mentioned the nitty-gritty on the scope of the Ombudsman in respect of dispute settlement for the users from within the industry, it is expected that some long pending issues between users like freight

forwarders and airlines/terminal operators or airlines and airports will be covered by the Ombudsman. However Kannan clarified, “Since the Ombudsman is still in the consultation process and we have invited all the users, both common people and industry representatives, it would be too early to comment on any specific issues. It should be remembered that the dimension of the disputes between an end-user and airlines or airports and between one industry stakeholder versus another industry stakeholder is different. This aspect is desired to be discussed by the industry people themselves while participating in the consultation process.”

The consultation paper also says that there is a need to determine the scope of service that would fall under the ambit of Ombudsman. It is necessary to decide whether it should include only grievances pertaining to passengers or it should also include grievances pertaining to freight forwarders, ground handlers, and other such parties engaged in service delivery (engaged in commercial pursuit). The stakeholders are advised to give their comments on the subject by April 15, 2014.

Kannan also made it clear that Ombudsman would be the final stage for any dispute settlement based on the existing laws and rules & regulations. The Aviation Ombudsman will also have an Appellate Body in case of dissatisfaction with the decision of the Ombudsman. “People should come before the Ombudsman, if the grievances are not addressed by the service providers and there is a dispute,” he said. The consultation paper has also highlighted some best practices of the Ombudsman institutes across the world.

Aviation Ombudsmanassures redressal of trade issuesThe proposed Aviation Ombudsman, which is now in consultation process, will significantly include industry stakeholders to resolve their grievances against service providers and operators viz airlines, airports, ground handling companies and terminal operators. Speaking to Cargotalk, M Kannan, Economic Adviser, Ministry of Civil Aviation elaborates on the importance of this new initiative.

People should come before the Ombudsman, if the grievances are not

addressed by the service providers and there is a dispute”

M KannanEconomic Adviser,

Ministry of Civil Aviation

RATAN KR PAUL

Documents

Cargotalk April 14