11 hours Ago
NEW DELHI: Stung by an over 9% fall in exports in Aug, govt sprang into action to address container and shipping issues , with commerce and industry minister Piyush Goyal announcing a string of measures, including purchase of five vessels by Shipping Corporation of India and waiver of several charges, to lower the burden for exporters. The measures came amid an assessment that freight rates have started cooling down. For instance, Mundra to UK freight for a 40-feet container has declined from $4,000 to $3,200 between July 24 to Sept 24.
Some of the shipping lines told govt officials, including Goyal, that they may drop to $1,800-1,900 as the demand from China comes down. At an inter-ministerial meeting called by Goyal, it was highlighted that specific varieties like refrigerated, open-top containers or 45 cubic feet may be in short supply. Besides, lack of space on ships and blank sailing was at the heart of the issue.
Shipping lines were requested to increase frequency and ports were told to reduce turnaround time. "SCI announced that they are chartering container ships to significantly increase the capacities. It was announced that on an immediate basis, capacity will be enhanced by 9,000 20-foot equivalent units (TEUs).
SCI will also buy additional five container ships to enhance cargo handling capacity. The shipping lines assured that all charges like container transportation and Lift on-Lift off at yards would be embedded in the delivery order given to shippers," an official statement said. Following the instructions, state-run Concor responded by slashing container handling fees for 40-feet equivalent from Rs 9,000 to Rs 2,000 and for TEUs from Rs 6,000 to Rs 1,000.
It also made available its facilities for use as empty yards. All empty yards will also be GST-registered and have been asked to accept digital payment and barred from dealing in cash. Besides, to address long queues at ports, such as JNPT, authorities have been advised to install more scanners.
Customs too has been asked to review its risk-based assessment mechanism to open fewer export containers, which is seen to be holding up cargo..
