With Indian trade relations with other developed nations increasing and tonnes of essential commodities being transported through sea routes, there is an immediate need to look at the state of infrastructure at the country’s major ports. To increase the competiveness of the country’s exports in the global market by reducing the transaction cost from imports, the Indian government is laying stress on developing the number of container freight stations (CFS) in the country. Modern and technologically advanced CFSs play a significant role in effective custom clearance activities in the port.
However, with the increase in export-import trade through major ports in the country, the number of CFSs has not been increased to meet the demand. As a result of this, several multinational shipping companies are setting up their own CFSs. But most of these CFSs lack the basic infrastructure to handle cargo clearing activities efficiently and swiftly. The importers are the worst sufferers in this system. Although importers are paying a high price to the CFSs, they are not getting even the basic amenities. Moreover, the cumbersome procedures adopted by CFSs lead to delays in loading or unloading of cargo, for which the importers are compelled to pay extra money.
Normally, shipping companies appoint the CFS to transport containers from the port to the company’s area of operation. The shipping firms generally allot five days from the berthing of the vessels for clearing the products, no matter when the vessels arrive at the CFS. However, it often happens that if the dock destuff delivery of cargo, the importers face the problem of being denied the delivery of the cargo. This is a serious issue for the importers, as they have made all payments to the shipping company and customs department.
 In most cases procedure of payment takes lot of valuable time from the importers, for which they had to pay additional detention charges. The importers having no other option have to pay equally for the ground rent of CFS and also for the detention charges of the shipping company. As in any other maritime nation, the container detention charges in India are very high. An importer has to pay around $60 a day for 20 containers and around $120 a day for 40 containers. The charges are levied three weeks after the arrival of the cargo.
Often the shipping companies resort to unethical trade practises and systems to delay the delivery clearance process. As a result of this, the detention charges for the importers keep mounting. Apart from this, the shipping companies also add various other charges under different heads.
Since there are no laws to control and regulate shipping firms and CFSs in the country at the moment, the shipping companies are taking this as an advantage to reap the maximum benefits. The shipping ministry should act immediately to implement the Shipping Trade Practice Act to ensure fair practice in the shipping trade. At the same time, the Indian commerce and shipping ministry should jointly take proactive steps against the unscrupulous shipping companies, to help importers conduct their business with ease. The government should also ensure that more CFSs are developed in the country’s major ports. Dinesh Singh, Director, Shivam Shipping Services, a mid-sized shipping company in Navi Mumbai |
