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Attempts to Uberize cargo handling boomerangs in JNPT

India is eyeing an ambitious shift in shipping logistics with an ‘Uber-like’ facility that could radically change the way merchandise is moved into or out of ports. This ‘Uberization’ of freight cargo like how passengers choose their mode of transport for a ride. The scheme being implemented at sea ports is set to begin with India’s largest container port, the Jawaharlal Nehru Port near Mumbai.

The government has invited requests for proposal for creating this system, which would allow an importer or exporter to select a trucker via his phone app to transport goods directly from port to warehouse.

The move is a part of the country's big plan, drawn up by the customs in consultation with other departments, to bring down the time taken for imports delivery at sea ports to 48 hours and airports to 24 hours by 2020.

The move has however boomeranged with existing truck operators and their federations threatening to go on an indefinite strike if the scheme is implemented to bring outside transports of importer’s choice.

While JNPT tops the direct port delivery of imports, Chennai has caught up with nearly forty per cent of the containers going through this mode. Private ports like Katupalli and Mundra ports are also doing well on direct port delivery of imports.

This scheme to select the transport of importers choice will allow them sitting in their offices to pre-feed data and get customs cleared goods via transport directly from ports. This is being done as customs cleared goods also at times get stuck due to issues with transport logistics, which leads to pile up at ports with freight agents.

The customs department has already cut the dwell time, or the time taken at ports, to 140 hours from 286 hours in 2013. This, in fact, has been brought down to 62 hours is case of direct port delivery.

The department is looking to expand the program which is restricted to large importers at present. A direct port delivery, wharf to warehouse, facility has also been introduced that allows importers to take delivery of goods immediately after the cargo landed, instead of it being transferred to a container freight station with information about the arrival of goods going to the importers via SMS.

While JNPT tops the Direct Port Delivery of imports, the Chennai port has caught up with the west coast port by handling forty per cent of the importing opting this route of delivery. Private ports like Katupalli Krishnapatnam and Mundra are also doing well in direct port delivery of import cargo.

The present system of routing through container freight stations from the port was introduced two decades ago to relieve the congestion at ports. The customs clearance was done at Container freight stations. This involved transportation from the port to CFS and then from CFS to importers factory premises. The direct port delivery seeks cut the supply chain and has the cargo delivered at the factory.

Introduced at the Jawaharlal Nehru Port, also known as Nhava Sheva, the facility is now available also Chennai, Vizag, Mundra and others. The customs department is now keen that more importers, even the small ones, avail of this facility.

For exporters, Direct Port Entry has been introduced, bringing down the overall transaction costs as goods do not have to be kept at freight agents and can be brought in at the port only when they have to be loaded on to the ship.  The direct Port Entry of exports is not popular with major ports situated in cities since they have very little space to store the export containers in the port premises. The DPE is popular with private ports like Katupalli  Mundra which are situated outside the Metropolitan cities and therefore have lot of space in their port premises to store export containers.
Some importers in Chennai prefer their cargo to go to container freight stations since they don’t have storage facilities in their factory premises.

The ports and airports in the country introduced single-window clearance from April 2016 for goods based on certain risks parameters. This allows importers to clear goods sans payment of duty or any mandatory checks if they do not fall in any risk category. This has also brought down the cost of imports by bringing down transactions costs.

India is ranked 146 out of 190 countries on the World Bank’s ease of doing business ranking on the ‘trading across borders’ measure and the government feels this can be improved substantially to lift India’s overall rank. India improved its overall rank to 100 this year from 130 last year.  The present government wants India to break into the top

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