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The Union Shipping Ministry is planning to create an IT platform to connect all stakeholders in the shipping and logistics space. The initial capex will be about ₹400 crore, which will be borne by the ministry.
A senior official in the ministry told BusinessLine that the platform will connect every single stakeholder, right from the shipping company to the transporter taking the cargo to its ultimate destination, which will make the whole process paperless and save transaction cost, which are in the range of ₹6,000 crore a year.
Seamless operationThe official pointed out that importers have to maintain large manpower for clearing goods from the Customs Department and to take them to the warehouse. With the IT-based platform, being set up in association with the Indian Port Association (IPA), the process will become seamless, requiring less manpower.
All transactions will be compulsorily done through the platform. Compliance by stakeholders will be ensured with an amendment in the Customs Act. Rhe Customs Department IT infrastructure will be integrated with the platform for real-time processing of documents, the official said.
The platform will be operated by the IPA through a not-for-profit SPV. The platform is not for making profits but it will operate on an Opex model, where user pays a fee for transactions. The IT platform will be sourced from global IT vendors, who have the experience in handling such systems, the official said. A formal name for the platform has not been finalised because some companies want to call it Port Community System (PCS) while others have suggested a more broadbased Cargo Community System (CCS).
Eventually, the ministry will take a call on the right name for the platform, which is expected to be ready in the next 18 months.
Maersk Line’s Head of West Central Asia Trades Franck Dedenis said the shipping industry has been a late-arrival to digital transformation.
It has become the need-of-the-hour for the industry. PCS will assist various stakeholders involved at different stages in the shipping cycle, communicate better and enhance ease-of-business.
Many benefitsThrough PCS, Maersk sees the entire industry embracing the change towards a simplified environment where the stakeholders can work in a transparent manner, he said.
Among other benefits, the platform will allow efficient collection of customs duties from traders. It will also be effective in detecting smuggled goods. Quarantined agriculture goods will also get faster clearance certificates and port authorities will also be able to provide online services to the shipping agents, including tracking of cargo movement beyond port jurisdiction, the shipping ministry official added.
President of Mumbai and Nhava Sheva Ship Agents Association, Captain Vivek Anand, said that compared to global benchmarks of four days in Germany, it takes 7-10 days for India’s export/import cargo for completing documentation through 21 government departments. The platform will probably improve the operational efficiency by 60 per cent and help reduce corruption by almost 100 per cent in the industry, he said.
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