Category Archives: Rail/Road

Container Corporation of India (CONCOR) is likely to start coastal shipping services in the country’s eastern coast, linking Chennai Port with Bangladesh’s capital Dhaka. The eastern coast service will be run with two ships hired by Vishwa Samudra from the market. The 10-year contract deploys two coastal ships capable of carrying as much as 700 twenty-foot equivalent units with maximum gross weight of 21,000 tonnes (cargo plus container weight). The company had picked Vishwa Samudra to launch the Western coast service last year through a tender, seeking to benefit from the impetus given by the government to the waterway mode to decongest road and rail. Bangladesh’s booming economy has earned it the status as the fastest-growing economy in the Eastern hemisphere. The country’s GDP grew by 8.1 per cent in 2019 and is forecast to expand by 8 per cent this year also, according to the Manila-based Asian Development Bank (ADB).

Piyush Goyal, Minister of Railways and Commerce & Industry congratulated the DFCCIL team for completing the 500 km of Dedicated Freight Corridor (DFC) and said, “Just like IRCTC, which pays compensation for delays in its Tejas trains, railways freight customers should be compensated for late arrival of goods trains and emphasised for time-tabled goods train run on DFCCIL. Indian Railways should run freight trains in convoys for maximum utilisation of the path and increasing the average speed of freight trains.” DFCCIL has completed the 500 km of DFC out of the goal of 991 km by March 2020. He continues, “DFC has the impact to transform the railways sector. It is necessary to have separate tracks for freight and for passengers to ensure faster movement of both.”

The MCCI Logistics Forum 2019 emphasised on regular communication between importers of Nepal and the service providers in India to bring down logistics cost. Sudip Dey, Vice Chairman, Federation of Freight Forwarders Associations in India (FFFAI), suggests, “There must be regular interactions between the importers of Nepal and Kolkata Service providers to bring down cost of Nepal import. It was only due to lack of communication that anomalies were happening (e.g. port ground rent, penalty by Railways etc). KOPT may keep a liaison officer in Nepal for dealing with day to day issues. Border restrictions for transit into Nepal should be done away with and vigilance should be done with the help of risk management & IT.” Highlighting the importance of Indo-Nepal as well as regional trade MCCI officials maintained that an efficient logistics and transportation infrastructure would be critical for strengthening India’s trade and economic engagement with its neighboring countries like Bangladesh, Nepal, Bhutan and Myanmar.

Seeing the improved connectivity of Madhya Pradesh with other states in all directions, Walmart, Amazon and Reliance are preparing to tap the strategic location of Madhya Pradesh to set up logistic bases by locating national distribution centres and warehouses in the state. The state is likely to see intense activity on this front in March and April. The business heads of the retailers are planning visits in the couple of months to figure out details of logistics business. According to Rajesh Rajoura, Principal Secretary to the state government for industrial investment policy and promotion, “Walmart, Amazon and Reliance have expressed interest in building logistic hubs and warehouses in the state. Setting up retail outlets is neither their priority nor the state government. But logistic hubs will get due consideration.” Amazon also plans to enter fresh fruit and vegetable markets in a big way and would want to set up centres for supply in Madhya Pradesh and the rest of the country.

Indian Railways conducted a trial run of double stack cargo train on Western Dedicated Freight Corridor (WDFC) on the 306 km long Rewari -Madar Section. With this trial run, Indian Railways’ cargo carrying capacity is all set to receive a major boost. Indian Railways will run freight train at the maximum speed of 100 km/per hour against the current maximum speed of 75 kmph on tracks. The average speed of freight trains will also be increased from existing speed of 26 kmph on Indian Railways lines to 70 kmph on Dedicated Freight Corridors (DFC). Railways has already done a trial run of BOXNS cargo wagons at 110 Kmph, trial runs are being conducted on the Dedicated Freight Corridor Corporation of India (DFCCIL) tracks. The Dedicated Freight Corridor (DFC) infrastructure is made in such a way so that it utilises the carrying capacity of these freight wagons. At present, Indian Railways’ freight trains can carry 61 -71 tonne weight per freight carriage at an approximate speed of 60 kmph.

The second LOGIX India 2019 – International Buyer Seller Meet was held on December 12, 2019 at New Delhi, launched by the Federation of Indian Export Organisations (FIEO) with the active support from Ministry of Commerce & Industry, Government of India. The three days mega event saw well over 3500 business to business meetings along with parallel sessions on different issues, challenges and above all opportunities about the logistics sector across India and the world. Inaugurating the event, Som Parkash, Minister of State for Commerce & Industry, Government of India, said, “Logistics is the backbone of any trade and industry. Currently the logistics cost in India is 30-40 per cent higher than the global benchmarked logistics cost. And therefore, it is a big challenge for the government. However, the government aims at reducing it to 10 per cent of the GDP. The government is also planning to invest around 100 lakhs crore in logistics infrastructure in the next five years. We are also in the process of coming out with a new National Logistics Policy and creating data bank by getting feedback from different stakeholders.

The weekly AS8 is set to directly link the South-East Asian economies of Thailand, Singapore and Malaysia with the India Subcontinent markets of India and Pakistan. The AS8 will be characterised by its direct port connectivity from Laem Chabang to Pipavav, Port Qasim and Karachi. With this, shippers with India and Pakistan bound shipments from Thailand will find the AS8 service a faster alternative to relaying cargoes through transhipments. AS8 will start sailing from Laem Chabang on December 16, 2019 with the following port rotation: Laem Chabang-Singapore – Port Klang (North Port) – Port Klang (West Port) – Pipavav – Port Qasim – Karachi.

Jawaharlal Nehru Port Trust (JNPT) along with CONCOR are commencing a weekly scheduled export train from ICD Ludhiana to JN Port to ensure faster evacuation of export containers destined for JNPT. The service also enhances the trade requirement of Ludhiana with the Mumbai. The Ludhiana ICD caters to a vast interior market that includes the states of Himachal Pradesh, Haryana, and Rajasthan. With an extensive network of more than 80 ICDs nationwide, CONCOR commands the bulk of Indian containerized rail transportation.

Allcargo Logistics has forayed into the express logistics space by acquiring a controlling stake in Gati. The company has added another domestic service to its portfolio by entering a segment which has been growing exponentially through this transaction. “The exponential rise in cross-border and domestic e-commerce has opened up new markets for traditional express players such as Gati. With Allcargo’s existing strength in the ocean transportation business and Gati’s expertise in land and air transportation, we are now in a unique position to offer our customers a suite of truly multimodal solutions,” comments, Shashi Kiran Shetty, Chairman, Allcargo Logistics. According to a study led by Deloitte in 2018, the express logistics industry is expected to reach Rs48,000 crore (US$ 7 billion) by 2023. This growth will primarily be driven by domestic consumption, shift from unorganised to organised trade, e-commerce (domestic and cross border) and significant demand from the small and medium B2B segment.

In its attempt to reduce logistics cost, the government has decided to allow introduction of ‘road trains’ on select routes and between identified points.The transport ministry’s draft rule for road trains comes at a time when the Centre is putting more focus on building 2,500 km of greenfield expressways like the Delhi-Mumbai corridor. The draft specifies the length, height and width of the roads. Even state governments are constructing more such roads. The NHAI has also been tasked to take up building economic corridors on priority, which would connect major manufacturing hubs. This move will encourage multi-container transport on the road, simultaneously reducing logistics cost. This mode of transporting freight is popular in countries including Australia, United States and in Europe to move huge quantity of cargo. Road trains consist of a conventional prime mover – truck – pulling two or more trailers. One road train in India can replace at least three trucks and is expected to prove beneficial for movement of freight.