“To ensure sustainability, we have requested the Customs department to enable value added services at CFSs and ICDs for handling domestic cargo and cargo moving through coastal and inland waterways. Thanks to digitalisation we don’t have to run from pillar to post for documentation.”
Since you have recently taken over as President of NACFS, how is the situation with container freight stations and ICDs? What are the challenges that are being faced and as a President, how would you like to address them?
The presidentship has come at the time when Covid has attacked us and it was a challenge for me to accept this. But I am very happy that all the members of NACFS have shown faith in me unilaterally and it was really good to chair this association which is very good and we have just completed 25 years, but due to COVID-19 we could not celebrate in a big way, but we have done this small virtual celebration and it has come to me. My vision is to take this NACFS platform to a different level. I want to work with all the associations together and jointly present our case to the department and other agencies which are impacting the CFS and ICD business.
What are the key challenges that are being faced, can you list them?
COVID has brought in both opportunities and challenges. I personally feel that digitalization and sustainability are the important factors for taking this association to a different level. We have been working towards digitalization for a long time, but sustainability is a challenge which needs to be addressed with various types of initiatives the government has taken up. Under digitalization NACFS has developed the uncleared cargo (UCC) software but it is yet to be implemented in a full-fledged manner. There are instances in Kolkata where UCC software has been very strongly used and we have got the NOC from the department for immediate clearance within 30 days. Kolkata Customs has come out with a unique order which says any digital file which is sent to them for approval and if it is not attended to within the specified period of 30 days, it is deemed to have been approved. Although this technology implementation it is being done in all the parts of India but there are some bottlenecks which need to be attended. As we know there is a container shortage, so uncleared cargo is one of the issues. As per our statistics above 50,000 containers are lying in various custodian places including ports. On similar lines the handling of cargo regulation 2009 needs to be updated. These regulations are being changed from time to time, but I feel handling of cargo regulation needs a complete makeover because it was drafted a decade ago in 2009. The auction procedure also has to be dealt with because auction is done through some allied agencies causing problems which need to be attended and that also has to be brought into the network and attended to ensure there is no delay. So these are the issues I will immediately address over the next 6 months and new policies will be framed.
Our sustainability is very much challenged by DPD and DPE. But our members are well versed with this situation and we are requesting the Customs department to better utilise our established infrastructure which can cater for value added services like handling of coastal cargo, domestic cargo. Inland waterways is a priority of the government where CFS and ICD in eastern India particularly are serving the infrastructure needs, so the containers coming in can be handled at CFS and ICD and they are exported by river route to Bangladesh.
We have ready infrastructure of bonded warehouse inside the CFS and ICD which can be immediately used for the purpose of manufacturing. In the last, when the COVID-19 vaccine is released for distribution the government can use the bonded warehouse inside the CFS and ICD for FS purposes.
As Chairman of FICCI Logistics Committee, what actually you take up in that region?
This is again a new venture for me to deal with the state government because it was not recognised by NACFS earlier. So, when FICCI approached me I was very happy because I used to raise various issues related to local traders and so they elected me. I am with FICCI for around 5 months and I found that the West Bengal government is very attached to this organisation because our state finance minister Mr Amit Mitra was Secretary General of FICCI and he was very used to logistics.
CBIC recently came up with new policy for setting up ICD and CFS. What is your observation on that?
I would like to thank CBIC for coming up with a policy because the policy that was available in the public domain was not very clear. Even though there are certain aspects of it which we find to be difficult and anonymous to license raj. The good thing about the policy is we now have a clear idea about what the government’s vision is for the purpose of ICD and CFS, which was lacking earlier.
We are looking forward to less interference and good governance which is slightly missing in the new policy. Further it says, if the ICD or CFS is not able to achieve the targeted volume within 4 years of establishment, it will be closed down. Here I should mention that any infrastructure project cannot give returns within 4 years. Another issue is that every year CFS/ICD will be subject to audit. There is no provision in the new policy for a CFS/ICD to make an appeal in case its license is being cancelled. These are certain issues which we will take up with the Government.
How is the trade scenario in the Eastern region, dealing with Nepal and Bangladesh cargo? Are there still any challenges you face in handling exim cargo in these regions?
In Eastern India all modes of transport – air, sea, river, road and rail are used for international logistics. Further the government is taking all possible measures to electrify these routes. There are some problems in road logistics, but otherwise, we have seen few liners have come forward for connecting Bangladesh. They have direct service from Kolkata to Chittagong, and they have also started a rail service which gives lots of benefits to the trade with respect to handling their export by Concor. Indian Railways operates a parcel van which is again very quick and economical.
Coming to Nepal trade, I must appreciate Mr. Vinit Kumar, Chairman, Kolkata Port Trust for providing complete support to Nepal trade during Covid and post-Covid period as well. He has always been very outward to listen to the issues of trade and provide logistics solutions. There were some issues in road logistics as it is totally controlled by the state government, but sometimes the state government is not very keen to meet our local customs people.
What is being done for improving the business and operations at CFSs? And I think capacity and skill building is another issue. What is your advice to members to improve themselves?
We are very happy that we do not have to run pillar to post nowadays because of digitalization taking over slowly and steadily. There is a renewed interest for serving the client and developing required infrastructure. For instance, we have built a facility at ICD Durgapur only for servicing a particular client.
Let us talk about your enterprise. How is the Durgapur ICD doing? What is the business growth that you have seen there? Initially, I think the days were very tough where operationalizing it took some time, but now how are the things?
When ICD Durgapur was started there were some hitches during the initial 7 years, but later shipping lines, ports and Customs came forward, and we are happy to tell you that ICD Durgapur is doing well and has been put under green zone. The government had issued notification to export cargo from ICD in 2002 but it was not being used. My ICD started in 2006 but nobody used it even though a government notification says that for faster clearance, we can clear the goods at ICD before reaching Bangladesh without any stoppage at any point of time. And it was very much consented by the state government till pre-Covid, but now this system is not in place because certain changes have taken place. Earlier, customers used to export goods to Bangladesh in 15 to 30 days, but now through ICD Durgapur, they are exporting cargo in 7 to 10 days from Ahmedabad. ICD Durgapur is exporting approximately 4000 crores consignments in a year now, and we pay duty of around 500 crores every year. So, these things have been achieved.
