Webinar - An Interactive Session With Shri N Sivasailam, Special Secretary Logistics.

Key Takeaways

The present COVID-19 situation is expected to bring about positive changes in the long-term outlook of the logistics industry. Our key note speaker & panelists have stressed that the way to go is ‘digital’ i.e., to digitalize as many processes and reduce manual interventions.

• E-platform for documents: The government (Ministry of Commerce) is working on an e-platform for documentation to streamline the processes that will be accessible by all. This will be a permanent shift from how documents are currently processed. This will also provide new business opportunities and new ways of executing business. The Shipping Ministry has recommended, and the Ministry of Commerce has approved a recommendation for the use of e-bills of lading. The implementation of this is still being worked on. The challenge is that the bill of lading is a negotiable instrument and so this has to be approved by RBI. The relevant ministries are working towards resolving this.

• Health & Safety: The government and associations are taking measures even in the logistics industry, towards the prevention of spread of COVID-19 with social distancing, sanitization of areas, etc. for e.g. AITWA is actively working on sanitization and social distancing at Dhabas/eateries on highways for the benefit of drivers.

• Detention/Demurrage charges: Detention/Demurrage charges: There is a misalignment between the government and the expectations of the logistics/supply chain sectors with regards to the Detention charges and Demurrage charges. There will not be any blanket concession at CFS’s and ports, other than those already specified, and companies must pay the necessary ground rent charges. The fear on the part of the ministry is the creation of perverse incentives, where companies use the ground rent waiver as an excuse to not evacuate the cargo, causing unnecessary revenue loss to CFSs & ports. Companies are advised to work with their freight forwarders to evacuate containers as soon as possible by paying the charges.

• Movement of Cargo/Containers: Freight Forwarders/Companies need to actively push for their cargo to be released from CFS’s and obtain necessary passes which are now being released in a more efficient process. Companies need to take necessary permissions and get their cargo moved to factories/out of factories. The customs department is clearing shipments on the basis of scanned documents like COO. No need for physical submission of these documents for clearing goods.

• Communicating important updates: Intermediaries such as CHA’s, Freight forwarders are key to facilitate new developments and processes in the current situation, that support movement of cargo. As seen in the Delhi Airport example, there is a seamless movement of persons with just a simple form to be filled for passes. Similar ease of movement is expected in the shipping industry by decisions taken by the Ministry of Shipping, however, the intermediaries must be proactive in attaining the passes.

Our keynote speaker, Mr. Sivasailam, has stressed that in the current scenario, it is important that companies in the logistics industry come together to work within the framework laid out by the authorities right now.