The Hindu Business Line : Chennai airport must spruce up cargo infrastructure

Unless infrastructure is improved at Chennai airport, companies may divert cargo to Bangalore, where it takes half the time taken at Chennai to clear cargo.

T.E. Raja Simhan

Chennai airport risks losing its cargo business to Bangalore if infrastructure at the air cargo complex does not improve, feel members of the cargo trade.

Chennai airport’s monthly cargo import is touching around 12,000 tonnes, compared with the average 4,000 tonnes per month five years ago. Except for adding two sheds, there has been no improvement in infrastructure in the air cargo complex in the last five years, says Mr J. Krishnan, Vice-President, Air Cargo Agents Association of India, and Chairman, Logistics Committee, Madras Chamber of Commerce and Industry.

The Chennai air cargo complex is handling cargo beyond its capacity. It handled 2.34 lakh tonnes in 2007-08, against the capacity of 2.22 lakh tonnes. For the Airport Authority of India (AAI), Chennai, out of the total revenues of Rs 430 crore in 2007-08, cargo contributed the maximum of Rs 140 crore. This does not include the aircraft parking and handling charges, he says.

According to Mr Krishnan, the Chennai air cargo complex is not geared to handle large-sized parcels. Five years ago, cargo used to arrive in small pallets and in low-weight cartons. Today, however, Nokia’s pallet weighs 800 kg, and most parcel sizes are over 100 kg.

Last year, the free period to keep cargo at the air cargo complex was reduced to three days from five. The scene today is such that Chennai needs almost three days for the AAI to make cargo ready for clearance. The free days are all used by the AAI for its own internal working. The shortage of manpower and machinery adds to the problem, says Mr Vijaya Kumar, Vice-President, Chennai Custom House Agents’ Association.

The AAI consumes five times the transit time of air-lifted cargo from origin to destination. Consequently, the very purpose of routing imports by air to meet critical requirements is defeated due to the ‘mishandling’ of cargo by AAI, he says. The Minister of State for Finance, Mr S. S. Palanimanickam, in his inaugural address at the Golden Jubilee Celebrations of the CCHAA recently, said: “If you look out of the aircraft’s window you see cargo everywhere in the airport.” He was referring to the way cargo is scattered around the air-cargo complex. “Cargo should be readily made available to customers and the only time cargo is not available should be when it is carried by an aircraft.”

Agents handling consignments for some of the multinational companies say that companies in Sriperumbudur, a hub for electronic manufacturing two hours away from Chennai, working on just-in-time, will divert cargo to Bangalore if infrastructure does not improve at Chennai.

“If there are delays in Chennai, we will explore the option of moving to Bangalore in future,” Mr Sachin Saxena, Director, Operations and Logistics, Nokia India, told Business Line during a recent visit to the company’s plant in Sriperumbudur. “We need to work out the overall savings in the logistics cost by such a diversion.”

It takes 36-38 hours to move the cargo from the aircraft ‘belly’ to the ground, compared to three-four hours in developed countries. Another six-eight hours is added for binning — which is data entry in the airport authority system for storage of cargo in the earmarked location, according to Mr N. Siva Subramaniam, Chairman, Air Cargo Agents Association of India-Southern Region (ACAAI-SR).

Multinationals may be willing to spend more on road transport if their cargo is available on time. It takes nearly 50 hours in Chennai for clearance of import cargo. By moving to Bangalore, if the cargo is cleared in 12 hours and another four hours is lost in road transport, companies can still save more than half the time, says Mr Asad Caasim, Committee Member, ACAAI-SR.

“There is no concerted effort from AAI to overcome the problems at the air cargo complex,” he says. The proposal to move cargo to an off-location Air Freight Station has also been ‘scuttled’ by AAI. The AFS will ease the pressure on AAI and create space at the air cargo complex, he says. Mr Dinesh Kumar, Chennai Airport Director, says the infrastructure-related problem was there two years ago. But the new sheds provide a lot more coverage now. The situation looks better now than two years ago. “We will keep expanding the facilities,” he says.

Mr Subramaniam of ACAAI-SR says the roofs of the sheds leaked during the unseasonal rains that lashed the city recently. With the onset of the monsoon just a couple of months away, the AAI should take immediate steps to ensure that cargo is not kept in the open and that the sheds are well protected. “We should not have a situation like two years ago when tonnes of cargo were exposed to the heavy rains. Companies such as Nokia lost heavily then,” he says.