The orange city Nagpur has now carved another name for itself as the distribution hub of central India. With EXIM activities picking up pace in the region, the focus of discussion was on to map the present and future trend in export and import
In a bid to explore the challenges and opportunities that Nagpur has on offer for shippers and logistics service providers, the first edition of annual Smart Logistics Summit (SLS) was unveiled on 4th May at Nagpur. R. Ramprasad, Editor-in-Chief, Maritime Gateway in inaugural speech stressed on some of the big ticket infrastructure projects that have been launched or are in the pipeline for the Nagpur region. He called upon the industry representatives to look into the logistics issues faced by the trade in the region, and work collectively to find solutions to those in the interest of all stakeholders.
The first session discussed “EXIM Cargo Growth: Present and Future Prospects”, and panelists for the session were Anup Kumar Satpathy, CGM, Central Region, CONCOR; Shivkumar Rao, Director, R & Y Logistics; Kirti Shah, Partner, Reliable Logistics; and moderator K Sathianathan, Managing Director, Distribution Logistics Infrastructure. K. Sathianathan in the opening remark said that Nagpur has registered cargo growth, and simultaneously there are also challenges faced by shippers in the region largely related to port connectivity and the other issue is rail linkages to nearby ports – JN Port on the west coast, and Visakhapatnam and Krishnapatnam on the east coast. Logistics cost is major concern for shippers because it is on a higher side that includes charges at ports, cost of rail freight or haulage charges. That is the reason for which exporters/importers look at cost first followed by other components like value added services.
Taking the discussion forward Shivkumar Rao said: In the last 4-5 years volume has been stagnant, and the reason for it is availability of alternate modes. Road freight has come down in the due course and it is attracting lot of cargo. Most of the cargo moved in and out of the region is low value cargo, hence logistics cost plays a vital role. Industrial growth didn’t peak up as a result agri commodities have become the major cargo in the region. The haulage charges have influenced agro product segment like rice, which is a major export product from the region. Due to which the commodity is going directly to the port than through ICDs. Raw cotton moves directly to Nhava Sheva and then to Chittagong and Ho-Chi- Minh city. This cargo can be tapped by Nagpur ICDs if cost-efficient, better and faster connectivity could be ensured by means of alternate options such as via ports on the east coast.
Putting across views on EXIM cargo scenario, Anup Kumar Satpathy said: The rising railway freight rate is a concern. Concor in regular intervals has raised the issue before the railway board to review the tariff. It is likely that there would be price revision by the railways. There is provision for concession in tariff for movement of empty rakes but the same is not applicable on containerized trains. Container trains can be run between the central region and ports on the east coast but matching the timing of shipping lines at Vizag or Krishnapatnam port based on the commodities and requirements of the region is a challenge. There are some interests among the trade for alternate port connectivity on the east coast and soon central region will be connected by rail to these ports. Due to various issues turnaround time for rail bound cargo between Nagpur and JN Port has increased. Unless train speed is increased, transit time may not substantially come down. Followed by Concor facility at Mihan, there will also be bulk trains on offer.
Kirti Shah sharing his views on prevailing scenario said: Owing to the strategic location of Nagpur, companies like Future group have invested heavily in setting up distribution center there and in the due course saving a minimum of 1-2 percent on delivery cost. Similarly Patanjali group is eyeing more than `10,000 crore from their facility at Nagpur. These projects forecast a much robust cargo movement from the hinterland which is a positive sign for logistics companies. The cotton bound for Bangladesh is procured from Gujarat and other parts like Marathwada and takes a lengthy route via JN Port to Chittagong Port. While the raw material is needed at Dhaka but the congestion at Chittagong again delays the shipment. If a service could be provided via east coast port to Pangaon terminal, it could translate to savings in terms of cost and time.
