Indian efforts to cut dwell times at major ports struggle

Indian efforts to cut dwell times at major ports struggle

Indian authorities have been working hard to alleviate truck buildups across major ports to speed supply chains and lower logistics costs. Photo credit: Nhava Sheva Container Operators' Welfare Association

India’s efforts to bring down cargo dwell times as part of a larger ease-of-doing-business program have yet to translate into steady improvements, as dwell times edged up to 3.3 days at most of the major, or public, ports during the first fiscal half after some progress last year.

By port, those numbers were as follows: Jawaharlal Nehru Port Trust (JNPT), from 2.68 days to 2.94 days; Chennai, from 2.59 days to 2.76 days; Tuticorin (V.O. Chidambaranar), from 1.98 days to 2.01 days; Kolkata, from 5.1 days to 5.3 days; and Visakhapatnam, from 3.1 days to 3.6 days.

However, Cochin improved its first-half average dwell time to 5.12 days from 5.6 days previously, reflecting the speed by which DP World Cochin has been able to process vessels as well as trucks and trains on the back of advanced operating procedures.

Dwell time is the time taken for exports inside terminal gates to be loaded onto a ship and imports onto a truck or train. Containers staying longer in the harbor typically cause congestion and extra storage charges for shippers.

Improving port efficiency and taking cost out of the supply chain have been a key focus of the Narendra Modi government, which enabled India to move up 30 places to 100 in the World Bank’s 2018 ease-of-doing-business global rankings published recently.

JNPT loads the majority of India’s containerized freight and as such that push has been more evident there. However, the new data could be a cause of worry for port leaders and other stakeholders as they explore more proactive steps to speed cargo flows, including standardizing of carting hours for export cargo across all terminals and reducing free storage time for railed shipments.

Additionally, India’s top port is in the process of setting up a common trucker pool for import shipments moving through its direct port delivery (DPD) scheme that customs officials argue can save shippers substantially on their logistics costs. JNPT’s DPD volumes are steadily growing, with that traffic during October reaching 42,865 TEU, representing roughly 31 percent of total laden imports for the month.

Chennai handled 12,242 TEU of DPD shipments during October, out of total imports of 67,081 TEU, against 8,928 TEU and 71,076 TEU, respectively, during October 2016, port statistics show.

On the positive side, quayside efficiency at major ports appears to be improving thanks to DPD and other measures, especially gate automation, as the first-half overall average ship turnaround time was down to 2.65 days from 2.95 days a year earlier and average output per ship berth day was up to 14,900 tonnes (16,424 tons) from 14,218 tonnes during April to September 2016, government statistics show.  

However, those figures at JNPT were not so encouraging, reporting 2.32 days, from 2.01 days, and 22,331 tonnes, from 22,802 tonnes, respectively. Chennai had some modest improvements on both counts, according to new data.

Terminals at JNPT and Chennai together load more than 70 percent of India’s containerized freight moving via major ports. Further efficiency gains at these ports are critical as the threat private rivals — largely led by Adani Ports — pose to their market share intensifies.

To cite an example, Adani Hazira Port, an emerging alternative gateway about 120 nautical miles north of JNPT, hit a new monthly traffic high of 51,466 TEU during October since it opened in April 2013, the company told Wednesday. “It only reaffirms our belief in the growth potential of container business at Hazira Port.”

JNPT already faces competitive pressure from large-scale capacity building and aggressive shipper outreach efforts by Mundra, Adani Group’s flagship gateway, about 300 nautical miles away on the west coast.

JNPT leaders, however, remain upbeat about their ability to ward off those challenges as they embark on a spate of supply chain improvement schemes ahead of the opening of its new mega-terminal being built by PSA International.