The Hindu Business Line : `Chennai terminal strike exposes vulnerability of private ports'

THE days of congestion surcharge at the Chennai port is over, officials of Chennai Container Terminal Ltd (CCTL) declared in December 2001 after taking over the container terminal in Chennai port under a 30-year privatisation programme.

The reference then was to frequent strikes at the port that forced lines to impose congestion surcharge, and that the trade would not face such a situation after P&O took over.

But, they have been proved wrong. The lines operating in and out of Chennai have implemented a congestion surcharge of $50 per TEU ( 20-foot equivalent unit) from June 1. This was a fall-out of a strike by non-management staff of CCTL from May 23 to June 5. The workers were agitating against what they called unfair management practice and not for wage hike. This was, however, denied by the CCTL management.

Despite CCTL achieving 25 moves per hour, as against 15 achieved by the Chennai Port Trust when it was handling the terminal, privatisation in Chennai has not helped the trade, feel trade members.

Frequent disruption of work by CCTL workers has affected the terminal's credibility, and the recent strike has exposed the vulnerability in the logistics chain, they said.

"Nobody in the trade is happy after the terminal's privatisation in Chennai," said a source.

The lines are not to be blamed for imposing the surcharge, and the entire blame is on CCTL for not handling its internal issue that led to a major problem, said trade members.

There was hardly any interaction between CCTL and trade members on what was happening in the terminal. "The CCTL approached the trade only during a crisis," a member said.

In a meting with the Shipping Minister, Mr T.R. Baalu, last week trade members felt that the entire container operations at Chennai was given to P&O in such a manner that as per the contract the Government can neither supervise nor intervene with the functioning of the terminal.

The members also told the Minister that such private monopoly would permit open exploitation and that it should be reviewed to ensure accountability as well as performance, a reliable trade source said.

The members also emphasised the need for a facility for container handling at Ennore. The members requested the Minister to look into the issue to create a container terminal at Ennore.

This will not only encourage competition but will also ensure that there is no private monopoly, a source said.

Meanwhile, there are over 10,000 boxes meant for Chennai waiting at transhipment ports of Colombo, Singapore, Hong Kong and Port Klang.

Further, there are about 8,000 boxes, both import and export, waiting inside the Chennai container terminal for clearance.

These transhipment ports levy heavy penalty on boxes staying inside their terminal, and the trade had to bear the additional cost.

Further, export boxes from Chennai are missing connections to mother vessels at transhipment ports. Though the strike was called off on June 5, it will be more than two weeks before normalcy is restored at the terminal, a source said.

A source in a 100 per cent EOU (export-oriented unit) said that with frequent strikes, the reliability of the port particularly for container handling has suffered severe damage. With many firms working on JIT (just-in-time), they cannot manufacture and store materials pending export as the manufacturing itself is as per programme given to the firm by the buyers working on JIT.

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