DP World Chennai’s Costly Mistake Puts Importer in Trouble

 Source: http://www.portwings.in/articlesinterviews/dp-world-chennais-costly-mistake-puts-importer-in-trouble/

Chennai:

Port Wings News Network:

When the Government of India strongly vouching for steps to promote and ensure Ease of Doing Business in the country, a mistake (rather costly mistake) by a private container terminal operator operating out of Chennai Port has forced an importer to shell out about Rs 50,000 as additional charges to take delivery of his imported goods.

According to details available, a firm namely Balaji Flowers from Nilgiris regularly imports Lillium flower bulbs from Europe through Chennai Port. During the third week of December, the firm imported one reefer box of lillium bulbs from Holland.

The cargo, in a 20-ft Reefer Container, reached the DP World Chennai Container Terminal (also known as Chennai Container Terminal Limited –CCTL) in a Maersk Line Vessel MV Maersk Bentonville.

CCTL is one of the two container terminals in the Chennai Port and operated by Gulf’s major player DP World.

DP WORLD’S COSTLY MISTAKE

Since the importer decided to take delivery of the said container from Chennai Port itself, Balaji Flowers’ representative sent an email request to the shipping liner (Maersk Line) and asked them to hold the container for inspection and delivery from CCTL itself.

In response to the request, representative of Maersk Line intimated the importer that the Container Terminal (CCTL) has been instructed to hold the reefer box in the terminal for delivery after paying Special Service Request (SSR) charges.

However, giving scant regard to the liner’s directive, the DP World Chennai authorities moved the said container to APM Terminals CFS as a PNR movement without giving any information to the importer.

IMPORTER FORCED TO PAY MORE

With the reefer box moved to a CFS from the Port limit, the importer was forced to pay about Rs 44,000 as additional cost to release the cargo.

COLLUSION BETWEEN APM TERMINALS & DP WORLD CHENNAI

According to an importer, who wished anonymity, both the APM Terminals CFS and DP World Chennai Terminals are the culprits in the particular case.

“When the liner (Maersk Line) instructed the Container Terminal (DP World Chennai) to hold the said container at the terminal for delivery, on what basis they moved the reefer box to APM Terminals CFS is remains a mystery. The act clearly suggests that both the Terminal and CFS are hand-in-glove to extract extra charges through any possible means from importers,” he added.

According to the importer, had the container delivered to him from the terminal as instructed by the liner, he would have saved Rs 44,000, charged by the APM Terminals CFS.

REVENUE THROUGH UNLAWFUL MEANS

The importer also deplored that the illegal movement of the box from container terminal to APM Terminals CFS raises suspicion that terminal is colluding with the CFS to increase its revenue through unlawful means.

Sources in Chennai Port also alleged that the container terminal (CCTL), in collusion with most of the CFSes in the Chennai Customs Zone limit, always move huge numbers of containers under the guise of “enbloc movement” to CFS and force the importers to pay more for deliveries.

APPEAL TO THE PRIME MINISTER’S OFFICE

The importers also appealed to the Prime Minister’s Office (PMO) to identify and break such unholy nexus between different middle-level players like terminals and CFSs that are plaguing the business environment in the interest of healthy EXIM Trade.

NO REACTION FROM EITHER APM TERMINALS OR DP WORLD CHENNAI

When Port Wings sought reactions from the APM Terminals and DP World Chennai (CCTL) about the complaint of the importer, no one was available for comment.

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Port Wings Editorial: Apple Import Restrictions Put India in the Dock in WTO

Source: http://www.portwings.in/editorial/apple-import-restrictions-put-india-in-the-dock-in-wto/

Port Wings, October 28, 2015

As anticipated, members in the World Trade Organization put Government of India in the dock on the latter’s decision to restrict import of apples to only one port against a dozen located on West Coast as well as in East Coast of the sprawling country.

Even though the Indian representative successfully defended the move by banking on the very statute meant for global trade, where there is no ban on restricting movement of any goods to only one port of the WTO member country, the defence may be satisfying to the others at WTO but relatively failed to bring cheer among the importers back home.

India also defended the move by saying that the measure does not fall within the definition of an import licensing measure under the Agreement on Import Licensing Procedures and thus is not fit for discussion under the WTO Committee.

However, the Directorate General of Foreign Trade under the Ministry of Commerce is duty bound to explain to the consumers of imported apples, if not for the importers, on what grounds the decision of restriction on apple import has been arrived.

Despite defending it hollowly at the WTO on the issue, continuing delay from the government on categorically revealing the real reasons behind the sudden restriction leaves options for different interpretation of its intention.

While a section of trade feels it was an act of protectionism by the Modi-led Government to secure local market access for home-grown apples, another group feels it was done in a hastily manner to help a particular player who wants to control the country’s apple market.

Whatever said and done, it is in crystal clear terms that the apple production in home is able to fulfill only 50 % of consumption and the remaining are managed by imports from various countries including the USA, Australia and New Zealand.

And that’s why, these countries vociferously objected to the DGFT’s latest decision to restrict apple imports by terming that the measure has had an impact on trade.

Moreover, after the restriction of import of apples, the cost of Indian apples are likely to increase on par with the imported ones in the areas like Southern India, where the logistics cost to move apples from growing states that are in North India is almost same as importing them from other countries.

So, the government, which has been so far keeping mum on the issue despite demands to disclose the real reasons from different quarters, has to make it clear what it wants. It is time to understand the Newton’s third law which says --For every action, there is an equal and opposite reaction. India has already acted and this time, reactions may be from USA, Australia and EU nations, where India is exporting various goods.

Colachel Port Project Takes Wings

source: http://www.portwings.in/articlesinterviews/colachel-port-project-takes-wings/

Port Wings News Network:

With the Tamil Nadu State Government giving its nod to develop the Colachel minor harbour in Kanyakumari district into a Major Transshipment Port few weeks ago, the Ministry of Shipping has accelerated its process to convert the mammoth project into a reality in a shortest possible time.

Dr. Alok Srivastava, Additional Secretary, Ministry of Shipping

In an exclusive chat with Port Wings on the sidelines of an event in Chennai recently, Dr. Alok Srivastava, Additional Secretary, Ministry of Shipping, said that the (Shipping) Ministry is moving ahead in an unprecedented pace to make the port project a reality.

“We have already called for Consultants for Preparation of Detailed Project Report for Development of Colachel Port. Once the DPR is in our hands, which is expected in about six months time, we will move ahead with the next stage of the project, where we would be finalizing the financial parameters,” Dr Srivastava told Port Wings.

It may be noted that the Ministry of Shipping has already completed the pre-feasibility study of the mammoth port project and said to be convinced with the projections underscored in the report on its potential.

Dr Srivastava stated: “As for as the investment ratio for the project is concerned, Union Government (Shipping Ministry) would hold 76 % share and the rest will be for the State government of Tamil Nadu. In that 76 %, we would pool in funds from the profit making major ports to contribute towards the project.”

POTENTIAL OF COLACHEL PORT

Colachel minor harbour in Southern Tamil Nadu is strategically located in southwest coast of Peninsular India along the world’s busiest shipping route that pass from Europe, Gulf Countries, North Africa etc. through Suez Canal to China, Japan and Pacific Ocean countries.

It may be noted that the harbour is the deepest natural Port in the country with sufficient draft to host the latest 18,000-TEU vessels.

Moreover, Colachel Harbour’s geographical location is ideal to become a major transshipment port for the country as it is located in the right place to cater major ports like Cochin, New Mangalore, Mormugoa , Mumbai, JNPT in the West coast and V O Chidambaranar (Tuticorin), Chennai, Visakhapatnam , Paradip and Kolkata in Eastern side.

In 1995, the Tamil State Government engaged the Tamil Nadu Corporation for Industrial Infrastructure Development (TACID) to conduct feasibility study on Colachel Harbour and the agency submitted a favourable report to Government.

Again, in the instructions of Tamil Nadu Government a Malaysian Port construction Company in 2001 conducted an exhaustive feasibility study on development of Colachel as major transit port for the country and also proposed development of railway and road network around Colachel Port. Besides, the agency also submitted report indicating high economic potential for development of Colachel as Major Port in the interest of the country.

DEPENDENCE OF COLOMBO, SINGAPORE AND JEBEL ALI FOR TRANSSHIPMENT

For all these years, containers originating from the country and bound for far away ports in USA, Europe and Australia are using Colombo, Singapore and Jebel Ali (Dubai) ports for transshipment in the absence of direct services as well as draft limitations for hosting larger vessels.

ADVANTAGES OF COLACHEL

According to maritime experts, if the Colachel Port is developed as envisaged as the country’s major transshipment terminal, it will not only reduce the cost for the EXIM trade, but also help the country to save millions of dollars of foreign exchange now doled out as transshipment costs in those ports. Furthermore, the port may play a vital role in promoting coastal movement of containers meant to be transshipped via Colachel thus reducing pressure on road mode. 

Chennai Port’s proposed World-class Coal Handling Facility hangs in balance

Source: http://www.portwings.in/articlesinterviews/chennai-ports-proposed-world-class-coal-handling-facility-hangs-in-balance/

Port Wings News Network:

Chennai Port’s proposal to have a world-class Coal Handling Facility before the Supreme Court hangs in balance as the next hearing is slated to begin in November.

According to sources, the proposal, submitted by the port management, is fully backed by the Government of Tamil Nadu and Indian Railways for the business opportunity as well as long-term energy security to the state.

STORY SO FAR

Chennai Port was handling about 10 Million Tonnes of coal per annum at JD(East) Berths until the High Court of Madras vide Its Order in May, 2011, imposed a ban on handling dusty cargoes including coal at Chennai Port from October 2011. The Port has suffered a loss of cargo of about 18 Million Tonnes comprising Iron Ore and Coal.

With the ban in Chennai Port, other ports in the vicinity including the private ports located in Andhra Pradesh and Puducherry have garnered the share of the port. 

As the port’s revenue was dwindling away, the port management decided to move the higher court with a proposal to restart the coal movement via Chennai with modern and globally accepted non-polluting methods.

Thereafter, the Port filed an affidavit in the Supreme Court in response to the Order of the High Court of Madras. While considering the plea of the Port, the Supreme Court constituted the Empowered Committee in April 2012 and directed the Committee to examine the stand of the Chennai Port as per their affidavit. The Empowered Committee then directed the Technical Sub-Committee to look into the issues raised by the ChPT in the affidavit and submit a factual report.

In the report, it was pointed out that there is no scope for retaining the operation of dusty cargo in Chennai Port. However, during the hearing of Special Leave Petition in March this year, the Supreme Court heard the Appeal and asked the port to submit a fresh proposal to handle coal within the stringent environmental conditions.

WORLD-CLASS FACILITY

According to sources, if the Supreme Court is impressed with the proposal of the Chennai Port to handle coal in unique as well as non-polluting way, the Court may give its nod to restart coal operations in Chennai that was stopped more than four years ago.

According to sources in the port, the proposed system is envisaged in line with the best practices across globe in city ports such as Rotterdam, Hamburg and Hamburg. Besides, the port also imbibed Indian best practices from JSW Jaigarh Port and new Adani Terminal at Mormugao Port. It may be noted that Rotterdam manages 42 MT coal, close to the residential colonies and operating under more stringent environmental norms.

Speaking to Port Wings, a senior official from the port said, “Under the new proposal, coal would be handled strictly through closed conveyor system. For evacuation of coal, Railway wagons would be utilized fully and there won’t be any trucking.”

The port also proposes to have a strong monitoring and feedback system. In line with the best practices in the world and said to be the first of its kind in the country, the port proposes to have “auto-cut feature,”  real-time monitoring at 12 locations with results displayed at key locations and E-nose system.

It may be noted that if the Supreme Court allows the coal handling at the Chennai Port, the Tamil Nadu Pollution Control Board (TNPCB) has committed to appoint an Assistant Environmental Engineer for monitoring environmental parameters exclusively at the port.

According to official sources, the port, which is suffering decline in throughput and reduced asset utilization, with coal operations will be able to meet long term pension commitments.

WILL COAL COME BACK TO CHENNAI PORT?

According to industry sources, the chances of restarting coal handling at Chennai Port is bright as the port management seems to presented a new proposal based on global best practices. Now it remains to see, whether the Apex Court is impressed with the Port’s proposal and gives its nod to restart coal handling soon.

On the other hand, the port management is gearing up to meet any condition may be put forward by the Supreme Court as a rider for the proposal.