Category Archives: Rail/Road

Ravinder Katyal, Director Air Freight & Co-Load – ISC, DSV Air & Sea, says, “This Union Budget will allow businesses to run through, closer by airports and thereby decentralise the process and save the logistics cost. However, we really need to review that will the investment of Rs 39,61,354 crore on infrastructure development help improve the commercial/cargo facilities or not and the development of Tier II Airports on PPP mode will be for cargo also or only for passenger terminals. (If the same happens for cargo too, this will help better control or lower logistic cost and automatically time will be saved as the facilities will be close to their manufacturing hubs).”

With a feeling of optimism, Ashish Mahajan, Managing Director, Landmark Logistics considers it as a pro-growth budget. “No bad news for the sector could be considered as a good budget and same goes for the logistics industry. There is no change in service tax and reduction in service tax on railway haulage is a good news. No major change in customs duties, allocation for National Highways stepped up and airports in Tier- II cities, will directly or indirectly boost the logistics sector of the country,” he believes.

“In this Union Budget, an infrastructure push along with investment and consumption-led growth presented as the key priority areas for the government. This is quite expected that the government will do required developments for infrastructure and logistics sectors. PPP & ‘Make in India’ is always counted first on the fingertips of the government. As expected this Union Budget indicates that public investment does help in crowding in private investment. Sectors such as automobiles, cement, steel, paper, aluminium and fertilisers, which had the lowest capacity utilisation and were among the sectors that have been the ones hardest hit by demonetisation, are on a special focus by the government,” says “Announcements like total allocation of Rs 39,61,354 crore on infrastructure development, development of selected airports in Tier 2 & 3 cities on PPP mode, etc., will help the logistics industry to grow further. The government has shown its support investment directly by spending more on infrastructure, particularly roads and affordable housing. This will also help raise demand for core sectors such as steel and cement. Construction of roads and low-cost housing is highly labour intensive in India, which will also help generate employment in the economy,” he adds.

Samir J Shah, Chairman, FFFAI believes, “The recent bold steps from the government pertaining to fiscal discipline, restructuring of tax regime, capacity building through setting up of appropriate infrastructure and connectivity have further been strengthened by the Budge 2017-18 announcements. For instance, budgetary allocation of Rs 2,41,387 crore for multimodal transportation sector, increase of allocation for highways from Rs 57,976 crore in 2016-17 to Rs 64,900 crore for 2017-18, identifying 2,000 kms of coastal connectivity roads for construction and development, more emphasis on agro- based produces through NABARD and appropriate logistics facilities for them, emphasis on MSME sector, port connectivity, Greenfield ports, airports in Tier-II & Tier-III cities through PPP mode, logistics parks, etc would have long-term and significant effects on India’s manufacturing and merchandise trade.” “Remarkably, the finance minister has announced the government’s decision to set up 1500 Multi Skill Training Institutes across the country. For these, Rs 1,700 crore has been allotted for FY 2017-18. This highlights the government’s firm commitments towards adding value to capacity building in a larger perspective. FFFAI, in its pre-Budget memorandum had urged the Finance Ministry to address the micro issues related customs clearance. We are optimistic that the finance minister’s commitments on ease of doing business would resolve those in the days to come,” he states.

Express Industry Council of India (EICI) and its members welcomed the Prime Minister’s announcement to demonetise Rs 1,000 and Rs 500 notes. “There are some procedural issues that express companies have been facing while plying their vehicles carrying urgently required express shipments on the national high ways. The vehicles must pass multiple toll plazas and drivers carry cash to pay the toll charges,” says, Vijay Kumar, Chief Operating Officer, EICI. While every effort is being made by our members to ensure their drivers carry the new higher denomination notes as well as use other alternative payment systems available post November 11,2016, due to unprecedented rush in the banks as well as limits for cash withdrawals, it is turning out to be difficult to implement.

Mahindra and Mahindra has launched all-electric cargo and passenger vans under the brand name of ‘eSupro’ to serve primarily the business-to-business (B2B) segment. “The launch will usher in a whole new concept in emission-free cargo transportation and people movement. It will provide much-needed fillip to companies in the B2B and e-commerce segment,” said Pravin Shah, President and Chief (Automotive), Mahindra & Mahindra. The car-maker claimed that on a full charge, the new vehicles can run for up to 112 km, depending on load, and can achieve a top speed of 60 km per hour.

Concerned over falling exports, the Indian government is planning container trains for import-export cargo. The first step will be to cut down the time taken to move freight traffic. Travelling from Delhi to Mumbai by Rajdhani takes 16 hours but when it comes to a container train, the same journey takes three times longer which increases the cost and makes it uncompetitive. The Delhi-Mumbai freight corridor, once ready, will cut the travel time drastically. But that will take another three years. Studies have shown that it costs almost the same to move goods from Punjab to Jawaharlal Nehru Port Trust (JNPT) and from Mumbai to China. That gives a huge advantage to exports from Thailand or Malaysia, which are not just closer to China but have lower costs. The government is looking at ways to make transport costs much more competitive. A timetable will fix responsibility and ensure that trains don’t remain parked at a station for hours to push passenger trains.

By adding more than 100 cities to its pan India coverage, to meet festive rush, Rivigo has announced a significant expansion of its part-truck load capability – Rivigo Zoom. With Rivigo Zoom, Bangalore to Guwahati can now be connected with a four-day transit; Delhi to Guwahati in less than three days; and Delhi to Bangalore in less than three days as well. The expansion coincides with the company acquiring 1200 trucks from Ashok Leyland to take its fleet size to 2700 by the year end. Deepak Garg, Founder and Chief Executive Officer, Rivigo said, “We are confident that these improved transit times, and the broader network will enable significant enhancement in our customers’ market share through higher customer delight and zero lost orders in the upcoming festival season.”

The first Bangladeshi vehicle weighed down with imported consignment rolled into a customs depot in New Delhi. The truck operated by Expo Freight (EFL) was allowed to cross the border without requiring the trans-shipment of goods from one country’s trucks to another for the first time in the history of trade relations between India and Bangladesh. The truck, carrying cargo for EFL’s clients Marks & Spencer London, left EFL’s warehouse in Tongi, Bangladesh on August 27, 2016. After customs clearing at the Benapole-Petrapole border crossing, the truck crossed more than 1500 km before arriving at its destination in Alipur, Delhi. This achievement was made possible by the BBIN Motor Vehicle Agreement signed in July 2015 between Bangladesh, Bhutan, India and Nepal, allowing for easier passage of cargo and passenger vehicles between the four countries.

Container Corporation of India (CONCOR) and Continental Warehousing Corporation (Nhava Sheva) (CWCNSL) have signed an agreement where CONCOR rakes have been provided exclusive access at the three rail connected terminals of CWCNSL at Panipat, Lakhwada and Thimmapur. The synergies between the companies are likely to give a much needed boost to the movement of both exim and domestic containerised cargo by rail in the catchment areas of these three terminals. With this agreement, trade will derive huge benefit from reduced first and last mile connectivity costs as well as from 24×7 access to these terminals.  Moreover, the transaction cost of imports and exports is likely to come down once the operations start.