Logistics

Govt moves to address woes of EXIM trade, shipping lines

P Manoj Mumbai | Updated on December 20, 2020

An acute shortage of containers and a sharp spike in freight rates are expected to ease a bit, with the government moving to resolve three key issues cited by exporters, importers and shipping lines for the hurdles that have roiled trade.

On December 17, the Central Board of Indirect Taxes and Customs (CBIC) issued guidelines to smoothen the process of faceless assessment of cargo, including carrying out re-assessment of goods/bill of entry to avoid delays. The export-import (EXIM) trade and container lines had complained that the faceless assessment took as many as seven days, aggravating the shortage of containers for exports.

To speed up the assessment process, the CBIC has raised the monetary limit of assessment of bills of entry only by the appraising officers to ₹5 lakh from the existing ₹1 lakh. This will take effect from Monday.

On December 17, the Directorate General of Shipping lifted the 14-day mandatory quarantine period stipulated for ships arriving from ports of Covid-19 infected countries after maritime trade complained that this was delaying the berthing of vessels with a cascading effect on the container logistics chain. The quarantine had resulted in a wait of up to four days before berthing at ports. This not only delayed the discharge and destuffing of import loads but also the availability of containers for export shipments.

On a continuous basis, this delayed the whole cycle of several sailings and eventually resulted in a reduction in the number of sailings over a period. The removal of the 14-day restriction will lead to quicker turnaround of ships and enable extra trips in a month.

“Vessel slot is a weak area where you cannot do anything immediately,” said TS Ahluwalia, President, Northern India Shippers Association. Sea freight has soared by 100 per cent on an average, he said.

Railway move

On December 16, the Railways decided to waive haulage charges for moving empty containers and flat wagons till December 31, to ease the container shortage and check high logistics costs.

Some exporters say the cost-free movement of empty boxes may not fetch substantial gains as lines prefer to send empties to China and other places.

“From there (China, etc) they will be stuffed with cargo and moved to the US, for which they will get more than $6,000 per container,” an exporter said.

Ahluwalia said the cost savings arising from the haulage waiver should be passed on to the exporters. The container lines should not levy any charges from the exporters on this, he added.

Second, when empty containers are moved free of cost to inland container depots in the hinterland, priority for stuffing them should be given to readily available cargo and railed out to ports within the least possible time, instead of waiting for days for the cargo of companies with which the line has a commitment, he observed.

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Published on December 20, 2020
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