Dun & Bradstreet, which grows the most valuable relationships in
business by uncovering truth and meaning from data, shared a detailed report of its study titled ‘Port Logistics: Issues & Challenges in India’ with Shree Suresh Prabhu, Honourable
Minister of Commerce & Industry, and Dr Bibek Debroy, Chairman of PMEAC.
India has set an ambitious export target. To achieve a target of 5% share in world exports,
India’s exports need to grow at an average rate of over 26% for the next five years. This would require increasing its product competitiveness. Enhancing product competitiveness in the global market, in turn, needs infrastructure for trade to improve, and ports are a critical part of trade infrastructure.
Thus, the study encapsulates key issues and challenges and also proposes various policy
measures to strengthen the ports sector, which represents the bulk of India’s merchandise
trade. This is a unique and important study on Indian ports, capturing information from key
stakeholders in the port ecosystem across all the major ports. Additionally, the study
introduces a ‘Port Performance Index’ as an attempt to benchmark performance of various
ports by combining qualitative perception of stakeholders with quantitative outcome based data.
While much research has been carried out in the logistics segment, the current study is unique on the port ecosystem. Covering 14 ports which handle around 67% of India’s maritime trade, and engaging with 700 respondents pan India, the findings of the study obtained through both primary and secondary research highlight specific issues, some common and some unique to the ports covered in the study.
The Dun&Bradstreet team reached out to more than 700 stakeholders comprising government officials, trade associations, exporter/importers, cargo handling agents, freight forwarders and collected feedback of these stakeholders on both qualitative and quantitative aspects of business transactions at ports. Such rich ground-level data and insights were then analyzed using statistical tools and meaningful insights synthesized for policy purposes.
Key excerpts from the study:
The study involved identifying the issues and challenges faced by various stakeholders
while conducting trade at India’s 13 major ports and one non-major port Mundra which
handle around 67% of India’s maritime trade.
The scope of this study is limited only to container and bulk cargo handled at these ports
and does not cover liquid cargo.
The study involves primary survey of around 700 participants (i.e. exporters, importers,
CHAs, freight forwarders and industry stakeholders) pan India.
A Port Performance Index was designed for all the ports under study on the basis of
primary and secondary research. Three broad categories of database/information have
been taken into consideration for the construction of the Port Performance Index, i.e.
primary quantitative, primary qualitative and secondary quantitative. Looking at 13 major
ports, 3 ports (JNPT, Kamarajar, Vizag) have received ‘Good’ score; 7 ports (Cochin, Kandla, Paradip, Chennai, Mormugao, New Mangalore and VOC) have received ‘Average’ score and & 3 ports (Haldia, Kolkata and MbPT) have received
Five issues, namely port congestion, customs clearance (including scanning &
ICEGATE), shipping line issues & charges, documentation & paperwork, and
regulatory clearance are the most common problems across ports and out of these just
4 issues, constitute 80% of total issues causing detention & demurrage.
The average cost incurred by the trade on port logistics as a percentage of the total
value of consignment is 15%. The average port logistics cost at the major bulk cargo
ports on the east coast (16%) was found to be slightly higher as compared to the west
Break-up of the total port logistics cost reveal shipping line charges account for the
major share of cost (36%), followed by detention & demurrage (22%).
Around 85% of respondents were charged detention and demurrage up to 20% of the
time they trade in a year.
The three major findings of the report are – Processes and operations across the ports
are not standardised or uniform; Costs and time for key processes are
unpredictable and there is an unacceptable level of variation across ports as well as
within port; Several government initiatives taken need to be followed through to
Policy inputs suggested based on findings
More than 60 policy inputs have been suggested across operations, infrastructure and
connectivity which have been classified under 12 broad policy inputs. Since the time-frame and efforts to implement the various initiatives suggested is expected to vary, the 12 broad
categories have been further classified into three sections; Policy inputs that could be
considered in the short term, those that could be implemented in the medium to long
term and areas for further study. The 12 broad categories are:
1. Promote Direct Port Delivery & Direct Port Entry to facilitate container trade
2. Ensure transparency in Shipping line charges & operations and regulate Shipping
lines/promote domestic Shipping lines
3. Common digital platform – Bring all stakeholders on a single platform which can be
named as “National Portal for Cargo Facilitation (NPCF)”
4. Enhance customs clearance process
5. Promote 24×7 operations across stakeholders
6. Periodical performance audits/monitoring of terminals & resolution of tariff disputes
7. Standardise trade processes across ports and stakeholders
8. Consolidate CFS, convert them into warehouses and link all with railways
9. Augment rail infrastructure & operations
10. Overhaul physical infrastructure & enhance productivity
11. Rationalise documentation and process all documents through NPCF
12. Timeframe for regulatory clearances
Commenting on the importance of the study, Manish Sinha, Managing Director, Dun &
Bradstreet – India said, “To increase India’s share in world exports, we need to strengthen
India’s industrial sector and increase its product competitiveness. And to enhance product
competitiveness, we would have to improve the infrastructure for trade. Ports are a key part of trade infrastructure. Hence, Dun&Bradstreet offered to do this study to NITI Aayog. This report captures primary research from around 700 respondents as well as considerable secondary research. In all, we have covered approximately 70% of all maritime trade. We are committed to working with the government to expand the scope of this study to other logistics sectors. Furthermore, we are confident that the ground-level issues highlighted and the measures suggested to resolve the challenges in the given time frame will help in further facilitating ease of doing trade in India.”
Dr. Bibek Debroy, Chairman, PMEAC added “This study will be a useful reference not only for decision makers in the government but also for all those who have a keen interest in the broader trade and logistics sector. I welcome this initiative and hope that it is able to leave a thought-provoking agenda for a future set of actions: both for public and private stakeholders.” Arun Singh, Lead Economist, Dun & Bradstreet – India while shedding the light on the study added, “We have suggested more than 60 policy inputs across operations, infrastructure and connectivity which have been classified under 12 broad policy input. It is expected that a focused approach towards arriving at an actionable and effective solution of the addressable issues that have been identified in the study could largely bring down the transaction time and cost of trade, and provide impetus to India’s ambition to climb up the ranks in the Ease of Doing Business rankings.”
About Dun & Bradstreet (D&B):
Dun & Bradstreet (NYSE: DNB) grows the most valuable relationships in business. By uncovering truth and meaning from data, we connect customers with the prospects, suppliers, clients and partners that matter most, and have since 1841. Nearly ninety percent of the Fortune 500 and companies of every size around the world, rely on our data, insights and analytics. Customers use D&B Risk Management Solutions to mitigate risk, increase cash flow and drive increased profitability; D&B Sales & Marketing Solutions to manage their master data, analyse markets, locate prospects and increase revenue from new and existing customers; D&B Economic Analysis Group for solution-oriented analyses of strategic economic and business developments, thereby aiding informed
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