Seamlessly integrating the vast network of railways, highways, airports and waterways, India is gearing up to strategically position itself as a global containerised cargo destination. Prakash Tulsiani writes on the scenario. <p></p><p> It is broadly estimated that the average global container traffic has clocked a growth rate of around 10 per cent per year over the last 20 years. Intercontinental cargo movement and seaborne trade are expected to register a quantum leap in terms of volume in global freight transportation, driven by the emerging economies in Asia and Africa. On a world level, the share of containerised cargo has steadily risen to approximately 75-80 per cent of the global freight transport logistics. Though the containerised cargo segment in India is still lower than the world average, the Indian government is making rapid strides through coordinated efforts to provide effective supply chain solutions and transition to containerised cargo movement from break-bulk freight transport operations. It is also the need of our trading partners.</p><p> <span style="font-weight: bold;">Evolution of water transport</span><br />India took the first step in uncorking the latent potential of the country's vast river network by flagging off the transport of the country's first inland waterway cargo from Kolkata to Varanasi on River Ganga. This was the country's first Inland Waterways Transport (IWT) containerised cargo. This was immediately followed by the shipping of 16 TEUs of containerised cargo from Kolkata to Patna also on the River Ganga, both key routes on National Waterway-1. India is using only 0.5 per cent of its inland waterways network to transport freight, which presents an extensive scope for leveraging the trade potential of the country's vastly untapped marine channels and coastal routes. In addition to gateway port volumes and the abolition of highly restrictive cabotage rules by the Indian government that eased key rules for foreign registered vessels regarding intra-India freight transport, hold the promise of positioning India as a global transhipment hub and significantly improve the business competitiveness of Indian ports by shifting container traffic from established port hubs in the vicinity. As Indian ports become ready for increased transhipment activities, supply chain services would become streamlined and efficient, kick-starting a renewed cycle of economic growth and capital investment in the country's coastal trade economy.</p><p> <span style="font-weight: bold;">Containerisation evolving </span><br />There has been an exponential growth in port activities on pan-India basis with operations expanding. The country needs to make renewed efforts and focus on developing existing port and landside infrastructure and promote containerised logistics if it wants to become cost-competitive at the global level. Container shipping in India carries a higher operational cost compared to China. India has already started addressing key service issues by modernising infrastructure at ports which offer deep-berthing capacities to huge container ships. The port network around the country is being strengthened with ports at strategic locations revamping their organisational structures and realigning with global containerisation standards to offer quality services. These initiatives are positive developments, which hold the potential for bolstering the cargo containerisation ecosystem in the country.</p><p>The National Maritime Development Programme (NMDP) was a key initiative towards strengthening the port infrastructure of the country and facilitating increased movement of container traffic in the country. The program placed onus on steps like construction of greenfield berths and upgrading the capacities of existing berths, constructing deep-draught facilities for berthing of bigger capacity vessels, improving connectivity of ports with rail and road networks and initiating modernisation schemes for port revamps. A priority audit will need to be undertaken to identify the systemic constraints in cargo-handling capacities in major ports and assess whether the stated objectives of the NMDP have been attained.</p><p> <span style="font-weight: bold;">Logistics infrastructure key</span><br />The government is placing high focus on expediting the development pace of the country's infrastructure with a view to strengthen the logistics sector. Infrastructure development remains the key to realising the penetration of container freight movement to the hinterlands of the country. Initiatives like the Dedicated Freight Corridor (DFC), Delhi-Mumbai Industrial Corridor (DMIC), and National Highways Development Project (NHDP) reiterate the government's commitment to decongest the already saturated transport corridors, which had unduly high line capacity utilisations. The infrastructure development projects will facilitate the faster and economic transportation of containerised cargo along newly built trunk routes. With Tier I-II cities of the country and rural areas emerging as key consumption centres and demand triggers, containerised freight services will need to enhance their outreach to these yet untapped regions.</p><p>Free Trade Warehousing Zones, Multi-Modal Logistic Parks (MMLPs), Inland Container Depots (ICDs) and Container Freight Stations (CFSs) are key components in the logistics framework and help in simplifying the supply chain functionalities. </p><p>They have played a key role in propelling containerised cargo logistics on a higher growth trajectory through measures like port decongestion, completion of shipping formalities and creating the right ecosystem for the enabling of exim trade.</p><p> <span style="font-weight: bold;">Containerised logistics</span><br />Containerised cargo comes with the tag of standardisation, which facilitates its easy identification and handling in any part of the world. Standardised cargo is unique with every container having a distinct identification number and a size code. </p><p>Standardisation of cargo also facilitates economies of scale by allowing for lower costs of transport, an advantage that cannot be availed through break-bulk handling. Flexibility is also a key attribute of the containerised cargo movement and enables for the transport of diverse commodities, manufactured items and perishable goods. Special container facilities can be availed for goods like dry cargo and liquids. Containerised logistics come with the added advantage of own warehousing services and lower cost of packaging for containerised cargo. It also offers the benefits of reduced pilferage and losses. </p><p> <span style="font-weight: bold;">Towards a global containerised cargo destination</span><br />The Indian logistics sector is currently traversing a high growth curve on the back of key government policies and pro-industry initiatives. As Indian logistics shifts to &quot;point-to-point&quot; operational mechanism with &quot;hub-and-spoke&quot; model, agile supply chains and streamlined operations will become pivotal to improving last mile connectivity and reducing cargo transport downtime. As the vast network of India's railways, highways, airports and waterways is seamlessly integrated to leverage its potential towards building a robust multimodal transportation framework, the groundwork will be laid for India to strategically position itself as a global containerised cargo destination. </p><p></p>