The Government of India is mulling a proposal whereby ports may have to pay penalty to traders in case congestion at ports delays the latter’s consignments  Traders, who have been bearing the burnt of paying high transaction fees due to congestion of their goods at ports, may be able to breathe easy as the Government of India (GoI) is considering a proposal whereby ports may have to pay penalty to traders in case port congestion causes delay in movement of goods. According to a survey conducted by ShippingBiz360, while 86% of the respondents feel it is apt for ports to pay penalty to traders in case the latter’s cargo gets delayed due to port congestion, 14% feel the other way round.Reduction in profit
In this context, Ajay Sahai, director general of Federation of Indian Export Organisations (FIEO), the apex body for exporters in the country, while speaking to a ShippingBiz360 correspondent, says, “Traders being compelled to cough up extra bucks due to congestion at ports is an unhealthy scenario. They cannot even pass this congestion fees on to consumers as it is not mentioned in the contract signed, which results in huge monetary losses for them, thereby adversely affecting their profit margins to a great extent.” Mr Sahai also added that such payments reduce competitiveness of Indian traders when compared to their global counterparts.
Modernisation of Indian ports, need of the hour
Industry insiders opine that modernisation of ports is of extreme importance to overcome this problem. In this context, Dilip Parik, managing director of Aviation Logistics, a mid-sized logistics firm in Chennai, says, “One of the major factors behind port congestion is lack of proper road and rail connectivity to ports. This results in cargoes lying idle for several days, thereby causing port congestion. Therefore, custom clearance facilities should be expedited for quick clearance of cargoes.” Mr Parik also focused on the development of inland waterways, which can play an instrumental role in reducing port congestion.
Arup Choudhury |
