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Cargo Terminals? South Asia’s premier maritime business magazine `100

AUGUST 2017 WWW.MARITIMEGATEWAY.COM

RNI NO: TELENG/2009/30633 POSTAL REGISTRATION NO: LII/RNP/HD/1137/2016-18 The
Cruise
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Egg DATE OF PUBLICATION: 26/07/2017 DATE OF POSTING: 28/07/2017

CYBERCYBER AATTTTACKSACKS WILLWILL HURTHURT YYOUOU BEBE PREPPREPAREDARED TOTO DEALDEAL WITHWITH ESCALAESCALATINGTING OFFENSIVESOFFENSIVES 02 MARITIME GATEWAY / AUGUST 2017 Automate, connect and control with Cavotec’s inspired engineering.

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Watch Out! The e-pirates are at sea

here do you think the formal maritime cyber security cell, hackers are going to play vessel operators should protect their their favourite sport next? three keys navigational systems- GPS, WYes, at sea. The shipping AIS and ECDIS. industry that transports 90 per cent Of late, many vessels have left Somali Reliance on of the world’s trade has made itself pirates smarting by turning off the increasingly susceptible to cyber threats. AIS or faking a location to divert the automation cannot With shipping companies making a lot attention of the mischief makers. compromise cyber of data accessible to their customers However, it is only a matter of time through their mobile applications, the when these faceless pirates can security. Shipping and e-pirates could get hold of important dismantle security systems. Clearly, the information if the gateways are not idea of hackers is to cause maximum logistics firms have fortified against such attacks. Just damage. This means government to insure themselves like Petya that disbanded Maersk websites will be targets too. Although Line’s technology system and halted data on the industry’s vulnerability to against cyber threats operations, the next wave of threats, cyber-attacks is hard to come by, the cyber security chiefs say, will be incidence of e transactions is rising by too. sophisticated and destructive and no an estimated 2 billion every day in India longer disruptive. alone is an indication of the how many transactions can be susceptible to e-fire. Hackers are known to have shut down an oil rig by tilting it and another vessel Any attack as this on the Customs site had to be shored for 19 days before it could paralyse India’s EXIM operations could be made sea worthy. A repeat with the relying heavily on this site for attach of this kind could be potentially their approvals. Reliance on automation fatal for the shipping industry leading cannot compromise cyber security. to mounting losses because of the The recent attack on one of the global catastrophic effects it would have. shipping lines is only the tip of the iceberg. Globally, the industry has to Even as the industry makes transacting come together and fortify its fortress to easy by interacting with the customers ensure the hackers are kept off sea and online through various technology shore. platforms, it must be its lifeguard too. So, first things first. Shipping and transport firms have to insure themselves against cyber threats too. R Ramprasad Until such time the International Editor and Publisher Maritime Organisation constitutes a [email protected] Editor and Publisher R Ramprasad [email protected]

Associate Editors Omer Ahmed Siddiqui Sisir Pradhan [email protected] [email protected]

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Maritime Gateway is printed by R Ramprasad Published at Gateway Media published by R Ramprasad on behalf of Pvt Ltd #407, 5th Floor, Pavani Plaza follow us on @maritimegateway Gateway Media Pvt Ltd, #407, Khairatabad, Hyderabad – 500 004 5th Floor, Pavani Plaza, Telangana, India Khairatabad, Hyderabad – 500 004, Telangana, India Regd. Office: H.No. 8-2-293/82/A/379 & 379/A, 2nd Floor, Plot No. 379, Road No. 10, Printed at M/s Kala Jyothi Process Pvt Ltd, Jubilee Hills, Hyderabad – 500 033. 1-1-60/5, RTC Cross Roads, Musheerabad, Hyderabad – 500 020. CIN: U74900TG2007PTC054344 Editor: R Ramprasad EDITORIAL ADVISORY BOARD Views expressed in the articles are those of the writer(s) and may not be shared by the Sabyasachi Hajara Anil Yendluri Manish Saigal editor or members of the editorial board. Former Chairman, SCI Director & CEO, Krishnapatnam Port MD, Alvarez & Marsal Unsolicited material will not be returned. Chairman Editorial Advisory Board Company Ltd Jasjit Sethi Joachim von der Heydt Adarsh Hegde CEO, TCI Supply Chain Solution Copyright Chairman, Bengal Tiger Line, Singapore Joint Managing Director, Allcargo Logistics Capt Dinesh Gautama No material published here should be re- Julian Michael Bevis President Senior Director, Group Relations, South Asia P Jairaj Kumar Navkar Corporation Limited produced in any form without prior written Chairman & MD, Ocean Sparkle Limited A.P.Moller-Maersk Capt Sanjeev Rishi permission from Gateway Media. Shardul Thacker Advisor Capt Deepak Tewari Partner Worlds Window Infrastructure & Logistics Pvt Ltd Feedback Chairman, Container Shipping Lines Association (CSLA) Mulla & Mulla & Craigie Blunt & Caroe Navin Passey Readers are advised to send all feedback and Anil Singh Dhruv Kotak Managing Director Sr VP & MD, DP World Subcontinent Director, JM Baxi Group Wallem Shipmanagement (India) Pvt Ltd comments to [email protected] CONTENTS VOLUME 9 | ISSUE 11 | AUGUEST 2017

24 INDIAMED SERVICE Boosting Connectivity INDIAMED service is an endeavour to utilize good connectivity and road map for more services to add which will be beneficial to the trade in the north Indian hinterland, as it will save considerable time and cost in 36 moving cargo. CRUISE TOURISM The Cruise and The Golden Egg The winds seem to favour the industry as the government has raised the sails to give a major push to the sector by framing a favourable policy to make cruise tourism attractive and hassle-free. 42 TERMINALS Do we need automated terminals? India needs fully automated container terminals to meet the growing exim cargo requirements CYBER ATTACKS to speed up movement at terminal 33 and at the gate. WILL HURT YOU COGO PORT The Digital Era of 49 Moving Cargo SLS HYDERABAD 26 Offering shipping and allied Smart Logistics for a COVER STORY services on a single platform Landlocked State is not new to India, but Cogo Users and service providers of Cyber attacks are the new reality, the only question is 'when.' The key Port makes it frictionless by air cargo and sea cargo came challenge for Indian firms is that most view cyber security as an "IT minimising people interface and together to discuss challenges and issue". India ranks third globally as a source of malicious activities and sustaining the time and cost opportunities to make logistics its enterprises are the sixth most targeted by cybercriminals. It is high saving. smart in the landlocked state. time that shipping industry should wake up to this reality.

INTERVIEWS 34 46 "IoT WILL DRIVE GREATER EFFICIENCY" “SHORTEN THE TIME TO GET CONTAINERS ON AND OFF THE VESSEL” VIJAY MINOCHA PRESIDENT - ASIA PACIFIC, INTTRA JAYANT TAGORE PRESIDENT, BDMAI 39 "FOCUS IS MORE ON RAIL AND INLAND 47 AVAILABILITY OF TRUCKS IS A CHALLENGE WATER TRANSPORT" D K MOHANTY SANJEEV CHOPRA, IAS VP & HEAD-FERRO ALLOYS BUSINESS UNIT, IMFA PRINCIPAL SECY, INDUSTRIES DEPT, GOVT. OF ODISHA OTHERS 41 8 News in Brief “PRO-ACTIVELY COMPLY TO TFA REGIME” 10 Point Blank SAMIR J. SHAH 12 Numbers & Graphs CHAIRMAN, FFFAI 14 News

BRIEF NEWS

Wärtsilä India ‘Cargo district’ taking shape in Wilmington appoints the use of shipping contain- Neeraj Sharma ers for developing apart- ments, live/work units, a as President & coffee shop and a food truck MD park. Many of the containers used in the project are from Wärt- the bankrupt shipping line silä Hanjin. Coworx, a staffing India service company is among has the first to move into the ap- village to find tenants for point- private offices in shipping ed Neeraj Sharma A planned shipping container L S Smith Inc is developing containers and tenants for as the new President village is being developed in the property. The village has rooms, along with computer & Managing Direc- Wilmington city of the US. been named so because of stations. tor. Sharma comes with over 30 years of experience in the Energy and Indus- Gateway Rail trial sectors. He has significant experi- special service Indo-Bangla container service being mulled ence in leading and to Pipavav India and Bangladesh are developing emerging planning the trial run of markets. Prior to Port a container train between this appointment, he Gateway Rail Freight Kolkata and Dhaka in was Executive Vice has started a Satur- August. The aim is to as- President, Asia Pacific day Special Service certain whether a service and Member of the (Triple S Service) Rail can be run on commer- Executive Board for from ICD Sahnewal cial basis. It is proposed KONE Corporation. to Pipavav Port. This that a full rake of empty Earlier to this, he was Rail service is being containers will go through the connection between Gede in India Managing Director, run for exports on and Darshana in Bangladesh, the only broad gauge line between the KONE India. Sharma every Saturday and two countries. Gede is the last station and border checkpoint on the has also held manage- offers fixed evacua- way to Bangladesh in Krishnaganj CD Block in Nadia district of ment positions with tion plan and better West Bengal. The corresponding station on the Bangladesh side is global organizations connectivity of export Darshana. Bangladesh will send the rake back with export cargo. like General Electric containers from ICD and Alstom. Sahnewal to Pipavav Port. It is the only dedicated fixed day Kamarajar Port enhancing coal handling service for export evac- New cement uations in Ludhiana capacity project in region offered by any Two new coal Telangana container train opera- berths are be- tor. The first train ser- ing constructed New cement project vice was flagged off on at Kamarajar 17th June, 2017 from has been approved in Port and the Adilabad, Telangana. Sahnewal with 90 teu existing iron to Pipavav port, and Telangana’s State gov- ore berth is ernment has already is going fully loaded also being every Saturday. permitted mining on converted into an area of 1,572 acres Seeing the success of a coal berth, in the outskirts of this service, Gateway which will in- Ramai and Yapalguda Rail Freight intends crease its coal villages, for a period to start some more handling capacity by 36 million tonnes per annum. The three new berths of 20 years. Zenith dedicated fixed day are expected to be ready by March next year. A predominantly coal will be the company services to and from handling facility, the new berths are estimated to take its total handling responsible for the ICD Sahnewal. capacity of the dry fuel to 64 million tonnes per annum. project.

08 MARITIME GATEWAY / AUGUST 2017 Logistics performance index for states RIL petrochem complex to The commerce ministry is working on a Logistics Performance Index expand (LPI) for states and union territories and would announce the rankings The government has given green signal to by December or early next year. The commerce ministry has engaged Reliance Industries Ltd for expansion of its Deloitte to work out the indicators for the index. Under the index, states petrochemical complex in Gujarat, entailing and union territories will be ranked as per their trade related facilities. The investment of `2,100 crore. Near Hazira the move would help involve states in promoting the country's exports. The complex comprises of naphtha cracker, feeding parameters on which the performance would be compared include GST downstream petrochemical, fibre intermedi- rollout, removal of check posts and time taken in tax refund. ates and polyester plants. RIL's proposal is to increase production capacities of these plants by Allseas launches Indian Project Cargo JV debottlenecking and expansion through techno- Offshore transport specialist Allseas Group has partnered with Mumbai- logical upgradation. based Seamless Projects to form joint venture company Allseas Project Solutions. The new company will focus on project cargo in the Indian market and predicts rapid expansion, with plans already underway for Adani Ports in fray for buying offices at gateway ports including Mundra, Chennai and other strategic stake in DCI locations. The joint venture recently completed its first breakbulk ship- Adani Ports, Dharti ment, delivering a consignment of wind turbines from Mundra Port in Dredging and Con- India to the UK. struction, Mercator and a few other Indian Oil to buy North American sour crude domestic dredg- India's top refiner has issued its first tender ing players are in to buy high-sulphur, or sour crude from the race to buy the North America as it seeks to diversify government’s stake imports. Indian Oil Corp has issued a tender in Dredging Corporation of India (DCI). The to buy up to 2 million barrels of sour crude government has a 73.47 per cent stake in the from North America and Canada to meet its PSU. As the central government has decided growing demand. IOC is seeking to buy the to divest stake in a few loss making PSUs, a crude grades Mars, Southern Green Canyon formal proposal on DCI disinvestment is likely and Thunderhorse from the U.S. and Western Canadian Select from to be put up before the Cabinet soon. It has Canada in the tender. Sellers have the option of delivering the crude to been reported that Adani Ports is leading the Paradip Port on September 25-October 4 or to Vadinar Port on the west race to buy the entire stake. The company is coast on October 1-10. yet to decide whether it would be an individual buyout or form a consortia for the buyout.

Railways to develop Southern Freight Kandla Port awards dredging Corridor soon contract Indian Railways is in the process of developing a Southern Freight Kandla Port Trust has awarded a contract to Corridor (SFC), which would be connected to one of three cor- Van Oord to keep the approach channel to the ridors. The three Dedicated Freight Corridors (DFC) planned by Indian port up to its declared depth for the next the Railways will provide logistics support to the ‘Make in India’ three years. Trailing suction hopper dredgers, campaign and one of the corridors will be connected with the South- Volvox Delta and Volvox Asia, will be de- ern corridor for the benefit of smooth movement of freight from ployed to maintain both the channel and berth Southern states. approaches. To protect the environment the dredged material will be deposited in a desig- nated area at sea. Eicher Polaris to begin exports to Nepal and Bangladesh Bangladesh’s FTA with Sri Lanka Bangladesh’s first-ever FTA will be with Sri Eicher Polaris, which manufactures personal utility vehicle ‘Multix’, Lanka and that is expected to be signed by year will begin to ship the product to Nepal and Bangladesh. The company is end, Bangladesh’s Foreign Secretary Mohm- increasing its footprint into the metros and to all states by adding more mad Shahidul Haque revealed. Dhaka has been dealers. “We have already shipped a few units to Nepal. The commercial negotiating the FTA with Colombo since 2013 sales in the Himalayan nation will begin soon. We also have orders from to increase trade now worth $80 million every Bangladesh,” Pankaj Dubey, the chief executive and managing director of year. Fourteeen MoUs were signed between the Eicher Polaris said. He said they are also tapping the Central American countries for cooperation in various activities (Guatemala to begin with), African and Sri Lankan markets. including coastal shipping.

AUGUST 2017 / MARITIME GATEWAY 09 POINT BLANK

Excessive protection We are working on inland waterways (including is not in the interest of the the historic Buckingham steel industry as it makes canal connecting to it complacent. Steps must Chennai). So with all of be taken to make the sector the infrastructure, we want more efficient and globally to make Andhra Pradesh a competitive.” logistics and manufacturing – Nikunj Turakhia hub.” President, Steel Users Federation of India – Chandrababu Naidu Chief Minister of Andhra Pradesh

Chhattisgarh has the potential to become a logistics hub of the country after the rollout of GST, due to its geographical significance as it is located For the first time, we will in the central part of the be open to investment outside country.” India. We will invest in airports – Arun Jaitley and facilities worldwide. Finance Minister of India Our collective expertise and knowledge in managing domestic facilities for over five decades gives us a strong edge over other operators.” – Keku Gazder CEO, AAICLAS Major cruising nations like UK, USA and Germany have zero rate domestic cruises. India should also have zero rating for cruise tourism as it is in nascent stage in the country and such steps will provide it a much needed boost.” – Nitin Gadkari Union Minister for Road Transport Highways and Shipping

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MULTIMODAL LOGISTICS PARKS: PRIORITIZED LOCATIONS

North Punjab Jalandhar Amritsar Gurdaspur South Punjab Ludhiana, Sangrur Delhi - NCR Patiala Delhi, Faridabad Gurgaon Ghaziabad

North Gujarat Ahmedabad Vadodara

Kandla Kandla Port Bhuj

South Gujarat Multiomodal Logistics Parks have been Surat, Bharuch planned o be develeoped at 35 locations by the Ministry of Road Transport and Highways, as a part of the Bharatmala Pariyojana. Hyderabad is one of the fifteen locations planned in Phase 1 of the Bharatmala Pariyojana Mumbai Mumbai, JNPT Mumbai Port Thane, Salience of Each Node (Ranking) Raigad Dist 1-10 11-20 21-35

CARRIERS WITH >1% SHARE OF CONTAINERSHIP THE CHINESE HOLE IN INDIA'S TRADE CAPACITY, 000 TEU, JUNE 2017 Carrier Group Active Share(%) Order- Share(%) Total Share(%) India's trade deficit India's Exports to and ships book ($ billion) Imports from China Maersk Line 3,828 19.2% 410 13.6% 4,238 18.4% ($ billion) With China MSC 2,916 14.6% 187 6.2% 3,104 13.5% Exports Cosco-OOCL 2,185 10.9% 698 23.2% 2,883 12.5% With rest of the World CMA CGM 2,168 10.9% 225 7.5% 2,393 10.4% 6.8 8.3 Ocean Net- 1,378 6.9% 340 11.3% 1,719 7.5% 2005-06* 2014-15* work Express 90.4 89.2 (ONE) Imports Hapag-Lloyd 1,533 7.7% 40 1.3% 1,573 6.8% 65.4 53.1 48.5 Evergreen 984 4.9% 324 10.8% 1,308 5.7% 42.0 Yang Ming 596 3.0% 112 3.7% 708 3.1% 56.9 19.2 10.9 PIL 358 1.8% 144 4.8% 502 2.2% 4.1 2005-06* HMM 458 2.3% 0 0.0% 458 2.0% 2014-15* 2005-06 2009-10 2014-15 2015-16 Zim 308 1.5% 11 0.4% 319 1.4% Wan Hai 235 1.2% 15 0.5% 250 1.1% Trade deficit with China has Trade deficit with all other Notes: Includes all recent M&A deals, including CMA CGM's impending 4Q17 purchase of Mercosur Line from raisen 13 times in 10 years Maersk Line countries has fallen 28% Source: Drewry Source: Commerce Ministry of India in 6 years

12 MARITIME GATEWAY / AUGUST 2017

Source: Alphaliner

NEWS

participate and provide response has not been high. Odisha govt LOGISTICS ideas and inputs on expand- Currently, a total of four ing the reach of the WMU international flights operate shapes up to the Asian region. The from the Pune airport. They industrial corridor Govt clears three role of the executive board include two to Dubai (Air export infra plans members is to oversee the India and Spice Jet), one to decisions for the running of Abu Dhabi (Jet Airways) the WMU. and one to Frankfurt (Luf- thansa). There has been no international cargo export Railways to from the Pune airport facil- diversify its ity. freight basket Pune airport director Ajay The central government has Kumar said it was initially Odisha government is given its approval for three expected that two tonne developing infrastructure proposals including estab- cargo will be transported in Jajpur, Jagatsinghpur, lishment of an Integrated from Pune daily. Around Kendrapara, Bhadrak, Cut- Cargo Terminal (ICT) at 40 per cent of international tak and Khurda districts the Imphal International cargo dispatched by Mum- which are emerging as new Airport; modernisation bai airport originates from industrial corridor attract- of infrastructure facility Pune and suburbs. ing large scale investment. in Karnataka for marine Comprehensive plans have exports – where the total been made to promote cost is `13.34 crore; and Union Minister Suresh Sri Lankan industrialisation in two construction of a new Prabhu said the Railways Airlines eyes more phases, three places in each ‘Standard Design Factory’ need to diversify its freight destinations in phase. “There is no other building at Cochin Special basket over a period of place in the country where Economic Zone (SEZ) for time and PPP initiatives are India two big ports are available which a total of `61.63 the best to accommodate within a distance of only crore will have to be spent. smaller quantities of cargo. 50 nautical miles from each The cost of building the “Railways traditionally have other. Both the ports are in been doing business in bulk ICT at Imphal is `16.2 the process of augmenting crore, of which the share commodities, that too in ten their cargo handling capac- of Trade Infrastructure for major commodities includ- ity with deeper draft,” said Export Scheme (TIES) is ing ore and cement among Secretary of Industries De- `12.96 crore and that of the others. Over a period of Airport Authority of India time, we will have to diver- partment, Sanjeev Chopra. (AAI) is `3.24 crore. sify the freight basket and Strengthening its South to do that, we need smaller Indian connectivity with quantities of freight,” he three new destinations, Sri HVGPL forays into Sanjam elected to said. The minister said the Lankan Airlines is looking container business World Maritime best way in which smaller at the possibility of connect- quantities of cargo can be ing more destinations into Hindustan Vacuum Glass University Board accommodated is through India given the potential Pvt. Ltd (HVGPL) has de- the PPP initiative. for growth in the market. veloped a dwarf container The Board With these additions, Sri in association with M/s of Gov- Lankan airline will operate Kalyani Cast Tech Pvt Ltd. ernors of Cargo operations 126 flights per week to 14 This is in line with Railway the World at Lohegaon cities in India, with existing Minister, Suresh Prabhu’s Maritime airport remain a services to Chennai, Tiru- announcement that railways University chi, Thiruvananthapuram, will use dwarf containers has approved the appoint- non-starter Mumbai, New Delhi, Gaya, to enhance cargo carrying ment of Sanjam Sahi A fortnight after it took Madurai, Varanasi, Kochi, capacity by 2 million tons Gupta as a member of off with much fanfare, the Bangalore and Kolkata. The per annum. The dwarf the University's Executive international cargo export new services would boost container has the standard Board for a two-year term. facility at Pune airport is connectivity for the business dimensions of a shipping Sanjam being the second still to find any takers. Of- community and enhance container apart from a lady and the only person ficials of the Pune customs opportunities for rapid and unique engineering design from Asia, in the executive say that the registration of seamless transport of all to enable these containers board will bring diversity to airlines for availing of the types of cargo throughout to be stacked and run on the Board. She will actively facility has started, but the Sri Lankan’s network. electrified tracks.

14 MARITIME GATEWAY / AUGUST 2017

NEWS

ping. The team sought Cargo Terminals (CUDCT) SECL says mines details of land that would at Guwahati, Tirupati, GST impact: be available in Krishnapat- Lucknow, Thiruvanantha- facing logistics Queues of trucks nam node surroundings puram, Varanasi, Amritsar, constraints for considering this region, across states get Srinagar, Vijayawada and which is located on the to undertake international Visakhapatnam-Chennai shorter cargo handling operations at Industrial Corridor (VCIC), Pune, Jaipur, Aurangabad, for the proposed Coastal Economic Zone (CEZ). Visakhapatnam, Madurai, Tiruchirappalli. AAICLAS to foray Nepal seeks into airports waiver on GST South Eastern Coalfields has been facing logistics internationally constraints in transporting The roll-out of GST will coal from pits to its railway ensure smooth move- sidings at Korba, Raigarh ment of trucks across state and Korea-Rewa fields. borders. Border commercial This has prompted the coal tax check posts have been miner to stop supplying abolished in 22 states after more than the trigger level the GST launch on July 1. to its customers till further Also, eight states – Assam, notice. Himachal Pradesh, Mani- pur, Meghalaya, Nagaland, AAI Cargo Logistics and Al- Nepal’s Ministry of Com- South Eastern Coalfields Punjab, Mizoram and Tri- lied Services Company Lim- merce has written to the has clarified that if consum- pura – are in the process of ited (AAICLAS) is looking Indian government urging ers require more coal than removing them. Now, the at investing in international for a waiver of GST on the trigger level it can lift GST will be imposed even airports. “In certain models Nepal-bound goods. This additional quantities by on inter-branch transfers at certain places we will follows a slowdown in ex- road either from the Korea- but input tax credit will be invest in facilities and third ports and imports of goods Rewa or the Raigarh mine given, which was not the party will manage them to and from third countries fields. case under the CST. whereas in some airports we via India due to confusion will build the facilities and created by implementa- operate ourselves.” We also tion of GST. The pace of Team from NITI have a strong mandate from imports and exports had Chabahar Port Aayog visits the board to explore cargo slowed down few days faces delay handling and allied ser- before implementation of Krishnapatnam the new tax regime, and has India’s long-running plan vices abroad,” Keku Gazder, not picked up since, it was to upgrade and oper- Port for CEZ CEO, AAICLAS said. pointed out. This has been ate maritime facilities at A high-level team of NITI “We are expecting the busi- attributed to Indian Cus- Chabahar Port in Iran faces Aayog and experts from ness to grow by 10-15 per toms offices still upgrading fresh delays after an initial the Central government cent in the current financial their IT systems, delaying bidding process to select visited the Krishnapatnam year and over 20 per cent movement of goods. a private operator for the Port recently and enquired project proved futile despite in the next fiscal year. The As Nepal relies mostly on about the availability of vigorous government efforts mandate of AAICLAS is to Kolkata Port to import and huge chunks of land, to spur interest. Authori- focus on cargo and increase export third-country goods, electricity, water and other ties are now planning to the cargo handled by our delays at Indian Customs resources for setting up a retender the contract, which coastal economic zone. The airports using best practices affect the country’s trade. and world class technolo- Cargo handling costs have involves management, team consisted of Yadhu- operation and mainte- gies. We are mandated to gone up since the imple- vendra Mathur, Additional nance services, after Essar Secretary, NITI Aayog, perform all functions and mentation of GST. The Ports Ltd., one of the two Sanjeev Gupta, Additional explore opportunities that authority at Kolkata Port prequalified Indian bidders, Secretary, Department of contribute to the growth of earlier used to impose 15 failed to fulfil security clear- Industrial Policy and Pro- our airport related business.” per cent logistics service motion, Ministry of Com- charge on goods imported ance requirements, leaving merce and Industry and In the FY 2017-18, AA- from third countries, but Adani Ports and Special Abhishek Chandra, Deputy ICLAS is planning to launch post-GST the charge has Economic Zone as the sole Secretary, Ministry of Ship- Common User Domestic increased to 18 per cent. bidder.

16 MARITIME GATEWAY / AUGUST 2017 Size:16cm x 25cm

IMFA is India’s leading fully integrated producer of ferro alloys straddling the value chain from mining to smelting with 187 MVA installed furnace capacity backed up by 258 MW captive power generation and chrome ore mining tracts. The Company has an Integrated Management System comprising quality, environment and occupational health & safety certification.

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Azerbaijan to to double its exim ware- (LTTC) with TISCO, India Patel Logistics housing/ CFS stations and Cements and UltraTech invest $60m to set up 10 logistics park capacity to 10 Cement. million sqft by 2020. in Iranian rail warehouses salient features of the initia- terminal The company will focus on tives: Long Term Tariff the booming e-commerce Contracts; The Minister space under the domestic announced that Indian focus where it already Railways shall enter into works with all key play- long term tariff contracts ers as a B2B player, but with key customers using not into last mile delivery. pre-determined price escala- In fiscal 2017, Allcargo tion principle, to develop reported net profit of a long-term commitment; Patel Integrated Logistics `230.4 crore on a revenue The LTTC was finalised has decided to invest over of `5,568 crore and a debt after a process of structured 80 crore to set up 10 Azerbaijan has signed a ` of `300 crore. dialogue with key custom- warehouses together mea- ers; Under LTTC, IR shall $60-million contract with Allcargo is building its suring over 1 million sqft be assured of long-term Iran to construct a rail largest MMLP at Jhajjar in the key traffic regions at freight revenue commitment terminal in Astara, close to in Haryana on a 180 acre an investment of over `80 from customers at pre- the common border. It is land which will be ready by crore, Patel Logistics, CFO, determined price escalation part of a project to connect next March. The company Mahesh Fogla revealed. principle as the customer the Iranian port of Astara expects the final customs to an Azeri city with the shall commit Minimum The first warehouse is be- clearance for its 20 acre same name. The route will Guaranteed Gross Freight ing set up in Bengaluru. In CFS in Kolkata anytime connect Iran to Azerbai- Revenue (MGGFR) for the first phase more such now and commission it by jan’s railroads, ramping up each year of the contract facilities will come up in mid-August. Allcargo has rail transport between the period at a minimum of 5 Ahmedabad, Chennai, and also acquired land for exim two countries. per cent increase over the Gurgaon this financial year, warehouses/ CFS in Ben- previous year. Azerbaijan is committed to while the second phase, galuru (100 acre), Hyder- transport 2 million tons of which will begin next year, abad (a 40-acre CFS will be cargo via Astara when the will see warehouses in ready soon), Chennai (54 project is completed in two Pune, Mumbai and Hyder- acre) and Nagpur (60 acre) years. Azerbaijan has com- abad. into which it will pump in East Coast pleted the part from Azeri around `1,000 crore. Logistics eyes city of Astara to the border. Iran has yet to complete the Allcargo to get `100 cr revenue remaining section. into last-mile Railways launches new freight East Coast Logistics Pvt Armstrong to sell delivery Ltd has set targets of `100 initiatives crore in revenue and 15 mil- sorting machines lion tonnes in cargo for the in India current fiscal. “In 2016-17, Armstrong Machine Build- we registered total income ers, a Pune-based firm in of `77 crore against `52 the logistics automation crore in the previous year,” space has entered into an said V Suresh Anand, Ex- exclusive tie-up with Pitney ecutive Director, East Coast Bowes to sell the latter’s Logistics. machines in India. The For the last four years, agreement allows Arm- With the GST boost, All- The Minister of Railways, ECL has been growing at strong to sell Pitney Bowes cargo Logistics is planning Suresh Prabhu launched about 40 per cent annually. products exclusively in an aggressive domestic play new freight initiatives with ECL’s target of 15 million India. Through the tie-up, by entering the last-mile the firm would also be the aim of giving a fillip to tonnes per annum (MTPA) delivery space and has cargo movement by rail. of cargo compares with 11 selling automated sorting set a target of trebling its machines solutions – that He released a new freight MTPA handled in 2016-17. domestic revenue at `1,500 are a mix of software and structure for double-stack Last fiscal, ECL handled crore from the segment by hardware – in Brazil, Rus- dwarf containers and signed 9.5 million tonnes of coal sia and China, though it is 2020. The company will agreements under Long and one million tonnes of not exclusive. invest around `1,000 crore Term Tariff Contracts iron ore.

18 MARITIME GATEWAY / AUGUST 2017

NEWS

Freight movement “The low sea freight cost Pendulum Express SHIPPING due to direct link with via waterways on Chinese ports, and low port Lines launches the rise charges will work as com- services to India Port operators pensation for Nepali traders eye big business The country witnessed a worried about higher cost from Ro-Ro notable jump in freight emanating from longer dis- transport and cargo move- tance,” said Ashok Kumar ment through waterways Temani, chairman of Road between FY14 and FY16. Transport and Transit Com- During the period, the total mittee at the Federation freight through coastal ship- of Nepalese Chambers of ping from all ports, includ- Commerce and Industry. ing major and minor, rose 10.9 per cent from 161.36 Cochin Shipyard Pendulum Express Lines million tonnes (mt) to (PEL) entered the Indian 178.92 mt. While the freight bids for assets of common carrier feeder transport from major ports Hooghly Dock arena with a soft launch increased 9.2 per cent to in May 2017 using fixed Gujarat Pipavav Port plans 125.26 mt, that from minor space allocation on the to triple its annual han- ports jumped 14.9 per cent PIX service from Mundra. dling of automotive cargo to 53.66 mt. Similarly, cargo The Pakistan India Express to 300,000 cars by 2020, movement through NWs (PIX) service has a rotation Keld Pedersen, the Manag- rose more than 32 per cent covering Singapore, Port ing Director of the port from 32.26 mt in 2013-14 to Klang, Colombo, Karachi, revealed. Mumbai Port 42.66 mt in 2015-16. Mundra, Port Klang. Trust handled the biggest chunk of exported cars in Cochin Shipyard Ltd (CSL) PEL, recognising the poten- the fiscal year ended March Vizag Port offers is looking to take over the tial of the Indian market, 2017. At more than 2 lakh direct link to assets of defunct shipyard further highlighted its com- units, the volume was 20 Chinese ports Hooghly Dock and Port mitment to this market and per cent more than the Engineers Ltd (HDPEL) announced that it would previous year. Jawaharlal and has placed a bid under introduce a new weekly Nehru Port Trust is looking its revival plan. The move service calling 3 west India at setting up a RoRo facility will help CSL foray into the ports. The North Asia- for vehicles at a satellite inland water space. “We India Subcontinent (NISC) port it is planning to build are looking at forming a service has commenced. at Wadhwan with an invest- joint venture, but moving Pendulum’s partners in this ment of `10,000 crore, its strongly into the inland service are HMM, CMA, deputy chairman said. water space. We have bid KMTC and SCI. Each Visakhapatnam Port has for HDPEL’s tender for the partner, including Pendu- urged Nepali traders to upgradation, operation, lum, will contribute 1 vessel Developing make more use of the sea- maintenance and manage- while HMM will contribute waterways in port as the cost of ferrying ment of two of its shipyards 2 vessels. goods from there is lower. at Salkia and Nazirgunge,” The tentative rotation Tamil Nadu The frequency at which Madhu S. Nair, CMD, CSL would be Xingang (Tian- cargo trains are leaving the said. A pre-feasibility study by port for Nepal indicates jin), Qingdao, Ningbo, Sin- a French company on fer- underutilisation of the port. Kolkata-based HDPEL’s gapore, Port Klang, Nhava rying cargo and passengers Salkia and Nazirgunge Sheva, Mundra, Hazira, across 10 inland waterways Although Visakhapatnam shipyards are located at Colombo, Port Klang, Sin- in Tamil Nadu will be ready Port is located quite far Howrah, West Bengal. The gapore, Xingang. With this next month. Based on the away from Nepal, it offers Indian Government had ac- weekly service, PEL as report, a feasibility survey lower sea freight costs, and corded in-principle approval a feeder carrier will offer will be carried out and the freight forwarders do not for formation of joint NVOCCs and MLOs an op- project is expected to be have to pay various charges venture of HDPEL with portunity to have space and ready in three years. Based such as detention cost, a player selected through a direct connection for their on the report, routes to be demurrage cost and many a bidding process as part containers from Hazira to taken up for further studies other formal and informal of its rehabilitation-cum- Singapore, Port Klang and will be chosen. charges. restructuring exercise. Chinese ports.

20 MARITIME GATEWAY / AUGUST 2017

NEWS

IRClass releases the shipping ministry wants several documents. Paradip Port rules for LNG- to keep it out of the GST The Web-based mechanism, handles 18.63 pc regime in order to boost the being developed by the fuelled coastal & industry. government-owned Na- more cargo in Q1 inland vessels To make India a global hot tional Informatics Centre 2017-18 spot for cruise tourism, a Services Inc., is aimed at policy is likely this month enabling the developer to as steps are underway to submit applications online expand number of cruise and track their status on a vessels to 700 from about 70 real-time basis. at present. Transportation of passengers (with or with- JNPT records out belongings) by inland improved Indian Register of Shipping waterways is not a taxable (IRClass) has released rules service under the Finance performance in Paradip Port has handled for LNG-fuelled coastal Act, 1994 and the same rule Q1, 2017-18 24.44 million tonnes of and inland vessels. These should be applied to “cruise cargo in the first quarter of rules will help the maritime ships” operating domesti- 2017-18 as against 20.59 mt stakeholders to promote cally or internationally. in the corresponding period of the previous fiscal (2016- environment-friendly fuels To promote cruise tourism, 17), a growth rate of 18.63 for coastal as well as inland an action plan is also on the per cent. Accordingly, the vessels. anvil that will include key number of vessels handled steps to bring it on par with The rules for gas-fuelled by the port increased by international standards. vessels have been developed 12.34 per cent during the A slew of measures are based on a study of the vari- period under review to 437, already been taken to boost ous international require- as compared to 389. ments such as the ESTRIN infrastructure that include (European Standard laying building cruise terminals JNPT continued its growth The Port has taken a slew of down Technical Require- at five major ports – Mum- momentum in the Q1, measures to enhance its ef- ments for Inland Naviga- bai, Goa, New Mangalore, 2017-18 by clocking a 5.11 ficiency, which has ensured tion Vessels), the IMO IGF Chennai and Cochin. per cent growth in container improvement in ship day Code, and consultations traffic by handling at 1.20 productivity from 22,161 with various stakeholders. million teus as compared to tonnes in 2016-17 to 25,588 PORTS 1.14 million teus in the cor- tonnes in 2017-18 (up to IRClass has also developed responding quarter of the June 2017), a surge of 15.46 rules for pleasure crafts Web nod soon for last financial year. per cent. Average turn- above 24 m length, which around time has improved are in addition to its rules dry ports, cargo JNPCT handled 4.01 lakh from 4.53 days to 4.40 days, for pleasure crafts below 24 stations teus in the latest quarter while berth occupancy has m length already published compared to 3.99 lakh teus The Centre will soon been reduced from 69 per earlier. These new rules are in the corresponding quar- announce a mechanism cent to 67 per cent. developed based on several ter of the last year with 0.5 that will facilitate online national standards as well per cent growth. Among the submission and processing as ISO standards. four terminals under JNPT, Fortigo starts of applications for set- APM Terminal handled GSTN service for ting up ICD, CFS and Air 4.99 lakh teus up 14.5 per Exempt cruise Freight Stations (AFS). The cent and NSIGT handled truckers tourism under GST proposed reform – with a 1.34 lakh teus as compared Fortigo Network has intro- view to boost India's foreign regime: Shipping to 1.17 lakh teus in last duced a technology solution trade – comes at a time year. to enable transporters and Ministry when demands for setting fleet owners to seamlessly up more ICDs, CFSs and In Q1 of the current finan- register on to Goods & Ser- The Shipping Ministry has AFSs in India have risen. cial year the port handled a vices Tax Network (GSTN). asked the GST Council to The Inter-Ministerial Com- total volume of 16.35 mil- Through this paid service, exempt cruise tourism under mittee (IMC), a single win- lion tonnes as compared to transporters and fleet own- the new indirect tax regime, dow clearance mechanism 15.90 million tonnes in the ers can upload invoices and in line with major cruising for applying for CFS/ICD corresponding period of the other GSTN documents and nations. At present, cruise is considered cumbersome previous year with a growth maintain their entire books tourism is not taxed and and involves submission of of 2.8 per cent. of accounts online.

22 MARITIME GATEWAY / AUGUST 2017 SOUTH ASIA NEWS

NEPAL MYANMAR goods to India. This comes SRI LANKA after a new air cargo cor- China may capture Yusen Logistics ridor was recently launched SOM to design a between Afghanistan and Nepal trade opens logistics India. Since the inaugura- new master plan tion of the air corridor, 62 for the Colombo India is at risk of losing the center tonnes of goods have been Port City Nepalese transit trade to Yusen Logistics has opened flown out of Kabul and China, whose high-speed the Thilawa Logistics a further 40 tonnes from Skidmore, Owings & Merrill rail under the One Belt One Center in the Thilawa SEZ Kandahar to India. Cus- LLP (SOM) has won the Road initiative, compares in Myanmar. The logistics toms officials were having contract to design the master plan for Colombo Port City. favourably to the slow center has 68,000 square feet to physically unpack and Covering 269 hectares, the trundle of Indian goods of warehouse space, includ- check all cargo before it was loaded on to planes. One of new city will extend the trains and the capacity con- ing temperature control straints on the border with the criteria for Afghanistan existing Colombo Central and bonded areas, together Business District. The Nepal. China controls only products to be exported was with an assembled vehicles that international packaging project, which is designed in 14 per cent of Nepal’s trade yard area. The temperature- standards are met. collaboration with Grant As- demand, but is now aiming controlled storage areas offer sociates landscape architec- to significantly shift Nepal’s four temperature settings ture, is intended to respond transit trade from India to of -20°C, 5°C, 15-20°C, as BANGLADESH to the sensitive ecology of itself. The OBOR proposal well as a room temperature the area, and includes canal itself is costly, where remit- area. There will also be an edges, new gardens, a new harbour, and a new city tances account for almost assembled vehicles yard area park. 27 per cent of GD. But to carry out logistics services given Nepal’s proximity related to assembled vehicles The design is also intended with India, the high cost of such as vehicle storage, to create a distinct skyline logistics makes the Chinese pre-delivery inspections, and – a “striking and legible rail proposal more viable. customs procedures. Yusen profile with a clear hierar- chy when viewed from key Logistics will use this facility points within the city.” This SINGAPORE as a base to offer a variety includes a central cultural of storage and delivery Vietnamese venue at the seafront. Strengthening methods for cross-border trade between Thailand and rice arrive at connectivity to MALAYSIA China Myanmar. Chittagong China’s Senior Minister The second consignment Local companies of rice weighing 27,000 of State for Trade and AFGHANISTAN urged to capitalise Industry, Koh Poh Koon tonnes that the Bangladeshi revealed that Guangxi, Lack of cargo government purchased from on air cargo an autonomous region Vietnam has arrived at the Chittagong Port. The ship industry bordering Vietnam, has scanners at carrying the consignment Local companies are encour- strategic land and sea links airports anchored at the Kutubdia aged to participate in the to the Asean region and outer anchorage. 60 per cent is "an important node" of the total imported rice Kuala Lumpur International in Singapore and China's from Vietnam would be un- Airport (KLIA) cargo space, Chongqing Connectivity loaded at Chittagong port announced Transport Min- Initiative. IE Singapore while the rest 40 per cent at ister, Datuk Seri Liow Tiong and the Guangxi regional Mongla Port. Bangladesh Lai. Alibaba Group from government are evaluat- has purchased 200,000 China and Renesas from ing a proposed transport tonnes of white rice at Japan have already acquired corridor that will connect $430 per tonne and 50,000 large space at the facility. tonnes of parboiled rice at the south-western city of Malaysia Airports Hold- $470 per tonne from Viet- Afghan Chamber of ings Bhd will give priority Chongqing with Singa- Commerce and Industries nam to maintain immediate to local companies which pore by way of Guangxi. (ACCI) officials have said availability of stock in the Pacific International Lines the lack of cargo scanning market, as well as reserves. need space in the cargo area. is developing a Singapore- machines at Kabul and The government has also KLIA is planning to develop Guangxi Logistics Park in Kandahar airports is a prob- cut the duty on staple food cold storage chain to support Guangxi's Nanning city. lem for traders exporting import by 18 per cent. trade in perishable goods.

AUGUST 2017 / MARITIME GATEWAY 23 INDIAMED SERVICE

undra has just moved one step closer to become the Number Mone container hub on the west Boosting coast. Adani CMA Mundra Termi- nal Pvt Ltd, a joint venture between Adani Ports & Special Economic Zone (APSEZ), India’s leading port connectivity infrastructure developer and CMA INDIAMED service is an endeavour to utilize Terminals (CMAT) – part of France’s CMA CGM Group has launched ‘IN- good connectivity and road map for more DIAMED,’ a new service linking the east Mediterranean region to India, services to add which will be beneficial to the Pakistan, Arabian Gulf and Djibouti. trade in the north Indian hinterland, as it will The launch was marked with the maiden call of m/v CMA CGM Vir- save considerable time and cost in moving cargo ginia. This milestone is an endeavour by Omer Ahmed Siddiqui to utilize good connectivity and road map for more services to add which will be beneficial to Mundra, as it will save considerable time for trade and is closer to the National Capital Region in north India. It will serve as a game changer as the goods will reach their destination in less than 24 hours, giv- ing an added boost to trade. To commemorate the launch of this service, a function was held on board the vessel, graced by Audrey Dolhen, MD, CMA CGM, India, En- narasu Karunesan, CEO, Mundra & Audrey Dolhen, Managing Director, CMA CGM India and Ennarasu Karunesan, CEO, Mundra & Tuna Ports, speaking at Tuna Ports; Avinash Rai, COO, Rak- the launch of INDIAMED service. shit Shah, ED, Capt. Kumar Paritosh, Terminal Head ACMTPL; Cherian Abraham, Terminal Head AICTPL, Jagdish Patel, Terminal Head AMCT, Paulson Joseph, CT Planning Head, Capt. Swaminathan, Commercial Director, Michel Azrak, Regional Director APL, Ajay Kumar KJ, Com- mercial Director APL. The launch of this new service highlights the importance of North Indian hinterland for the CMA CGM Group. The service will comprise 5 x 4,250 teu vessels operating on fixed day weekly rotation, as follows: Khor Fakkan – Karachi – Mundra - Nhava APM Terminals Mumbai. The service, and Indian Sub-Continent) services. Sheva – Djibouti – Jeddah – Damietta linking South Asia with ports in the “We are excited to welcome this – Piraeus – Malta – Aliaga – Mersin – Arabian Gulf and Mediterranean, new service that expands India’s mar- Port Said West – Khor Fakkan. was officially introduced on July 2nd, kets into key ports of Mediterranean. CMA CGM gathered its customers operating with vessels provided by We stay committed to CMA CGM in Gandhidham for a meeting, where CMA-CGM, its APL subsidiary, and and India’s trade with our reliable and INDIAMED service was presented Alliance partner COSCO. productive terminal services” stated and also highlighted the growth plans The weekly INDIAMED ser- APM Terminals Mumbai, COO, with the launch of the CIMEX 2X ser- vice provides the fastest transit times Ravi Gaitonde. The service rotation: vice in mid-July, connecting Mundra, between India and CMA CGM hub Khor Fakkan, in the UAE; Karachi, Hazira and Nhava Sheva to North ports in the Mediterranean and Ara- Pakistan; Nhava Sheva (Mumbai), and Asia and other world-wide destina- bian Gulf, and expands the tranship- Mundra, in India; Djibouti, on the tions. Earlier on July 5th, CMA-CGM ment network through the MEGEM Horn of Africa; Jeddah, Saudi Ara- had launched the new INDIAMED (East Mediterranean to/from Middle bia; Damietta, Egypt; Piraeus, Greece; service to Mumbai as well when CMA East destinations) and MEDEX (West Malta; Aliaga and Mersin, in Turkey CGM Virginia made its debut call at Mediterranean to/from Middle East and Port Said West, Egypt.

24 MARITIME GATEWAY / AUGUST 2017

QCOVER & A STORY

CYBERCYBER ATTACKSATTACKS WILLWILL HURTHURT YOUYOU

26 MARITIME GATEWAY / AUGUST 2017 Cyber attacks are the new reality,the only question is 'when.' The key challenge for Indian firms is that most view cyber security as an "IT issue". India ranks third globally as a source of malicious activities and its enterprises are the sixth most targeted by cyber criminals. It is high time that shipping industry should wake up to this reality.

by Sisir Pradhan

n June 27th, Ukraine came under the critical infrastructure. If we did our entire port IT system biggest cyber attack in its history, which ourselves, we could still be vulnerable to such attacks, but spread to Europe and then to the coast of the dependence has made it much easier to be affected big North and South America and beyond. In time when something happens abroad. I think the govern- the process it affected many industries from ment needs to invest in cyber security research, education, banking to power to port sector. Mean- training, and develop capabilities and manpower.” while, EXIM trade at Nhava Sheva on June It is challenging to assess the actual loss done to the 28th woke up to a nasty surprise and this time it had noth- trade due to cyber attacks which paralyzed terminal ingO to with long queues or operational issues there, rather operations but it is yet to be ascertained what would be APM Terminals Mumbai was forced to interrupt services the damage in case of theft of critical data because ship- as it was dealing with a world-wide unleash of cyber at- ping industry as a whole has millions of shipper and other tacks on Maersk and its Group companies including APM information. On this, Captain Vivek Anand, Terminals. President, Mumbai and Nhava Sheva Ship It is not the first time port and shipping Agents Association, said, “The unfortunate sector had come under cyber attack. Lars attack on Maersk Group global system and Jensen, CEO, CyberKeel, reminded, “The its cascading impact on Indian operations threat is significant, and has been severe for have led to an unprecedented accumulation several years. At CyberKeel we have warned of import laden containers. Such incidents about such attacks, but the general state are industry agnostic and impact all spectrums of the of affairs with the maritime sector is a low economy and not restricted to the maritime industry in level of cyber security.” In fact the Mari- particular. In all such cases, there are back-up support of all time Safety Committee (MSC) of International Maritime data, which is a universal practice and hence we believe that Organization (IMO) was very much aware of vulnerability all relevant data can be restored once issue is resolved and of maritime sector. IMO said, “The 98th session of MSC overcome. Coming to the June cyber ransomeware attack adopted a resolution on maritime cyber risk management. on Maersk, the systems by now should have limped back to In essence the resolution adopted at the MSC said that cy- normal by the time this is published.” ber risk should be included in International Safety Manage- But the fact remains that port and shipping industry are ment (ISM) documentation by the year 2021…. The main prone to cyber threat as hundreds of shipper data is con- point of the resolution is to clarify the situation and provide stantly uploaded onto their system, and any weak link can a deadline so that for port state control purposes, the cyber compromise others as well. Rainer Horn, Press Spokes- threat should be included by a certain date.” man, Hapag-Lloyd AG, clarified, “In general cyber attacks What went wrong! are a permanent challenge in our industry. We have sophis- Petya cyber attack on APM Terminals gathered much ticated and progressive systems in place and believe that our more attention and quick response from the government set up is pretty good. Furthermore, we have action plans in thanks to the widespread coverage that its predecessor, place including a Business Continuity Management. We WannaCry ransomware had attained. Industry experts have have had already cyber-attacks against our systems, but of been critical of the situation and stressed that port and ship- course our IT security experts do everything to keep mali- ping sector have been late entrants in coming cious software out of our systems.” onboard IT platforms. Dr. Sandeep K. Shuk- Contingency, Risk Assessment & Damage Control la, Head, Department of Computer Science The attack on APM Terminals Mumbai should be and Engineering, Poonam and Prabhu Goel treated as a wakeup call by the industry and the government Chair Professor, IIT, Kanpur putting his to build robust system to stay immune in the future or to perspective, said, “The attack was on the Eu- minimize loss. Dr. Sandeep K. Shukla of IIT Kanpur em- ropean system but then due to connectivity it phasized on regular data backup, standby servers, software crawled through the system. We need to stop being depen- to enable reinstatement of the system within minutes from dent on the FDI and foreign technology especially in the the backup when such attacks happen – that is a proper

AUGUST 2017 / MARITIME GATEWAY 27 QCOVER & A STORY

recovery plan and technology must be developed. Ukraine power grid recov- ered within an hour in the last attack ANIL DIGGIKAR, CHAIRMAN, JNPT on them – whereas a year before they took many hours. They learnt from Some preventive measures like the firewall with Intrusion their mistakes and worked on resil- Prevention System at Internet Gateway Level has been ience and recovery plan thoroughly. installed, with High Availability mode for protection With mounting data, gradually against any cyber attack. We undertake regular updating companies are moving towards cloud- of the security patches for firewall, Windows OD on based platforms. Moreover, many servers, laptops and desktops. Implementation of Data shipping lines due to global nature of Leakage Protection at Gateway level; Anti-virus on all their business have offshore data and servers, laptops and desktops; reviewing domain policy support centers. They also have data for all users; and Revoking Remote server Connectivity privileges have centers on Indian shores to leverage been put in place. We have disabled all USB ports across all systems in from low labor cost and IT capability. laptops and desktops. We have initiated action for conducting Vulnerability But now it is time for a thorough eval- Assessment Penetration Testing for the entire IT infrastructure at JNPT uation of these service centers in India and created Demilitarized Zone for critical servers. We have restricted and elsewhere. For example, Hapag- accessibility for all staff to only official email services and applied Lloyd AG has service centers in India, restricted URL policy for accessing websites through the internet. and when asked about the risk factor of offshore servers, Rainer Horn, Press Spokesman, Hapag-Lloyd AG assured, “We have and training, information security at Bali had adopted a resolution on service centers in India procedures, detection processes and “Planning cyber security program to as well, and the same response and recovery plans. Human reduce cyber risks”, informed Hiro security levels apply as error continues to be a significant fac- Nagai, Under Secretary, IAPH. anywhere else in our tor in breaches, hacks and ransomware Common perceptions amid small organization since they attacks and while technical upgrades business entities are that an anti-virus are an integral part of are necessary, developing an effective software has enough fire power to it. In fact, we had outage at one of our cyber security culture is critical to protect their business. One needs to centers some years ago due to a fire managing cyber risk.” understand that standard tools such in the building. The water by the fire The most vulnerable port systems as firewalls and anti-virus are quite fighters destroyed the electric system include, cargo management systems, ineffective. A very good anti-virus pro- of the whole building. Our contin- automated cargo handling systems, gram will only catch something like gency plan worked very well and no autonomous gantry cranes, automatic 50 per cent of the computer viruses container had to be left on a terminal identification systems (“AIS”) and out there. But, according to a technical worldwide and all ships sailed as global positioning systems (“GPS”), update from Microsoft, a significant scheduled. After two days all affected Belmont emphasized. part of the spread of the newest virus colleagues of the center started work- Meanwhile, taking cognizance could have been prevented if the sys- ing again with new hard-ware in an of the severity, the second edition of tems had the newest updated version alternative office space close-by.” The Guidelines on Cyber Security and had been properly configured for Speaking on risk assessment and Onboard Ships has been released in defense-in-depth. Note that both of preventive measures, Kate B. Bel- early July by a joint industry working these conditions have to be met - it is mont, Associate (Maritime), Blank group, whose members are BIMCO, not enough to have the latest updates, Rome LLP, and President, WISTA, Cruise Lines International Association the network configuration also have New York/New Jersey (CLIA), International Chamber of to be done to prevent internal lateral chapter, said, “One of Shipping (ICS), International As- spread of an intrusion. the most fundamental sociation of Dry Cargo Shipowners Bringing business back to normal things that a port, or (INTERCARGO), International Asso- Cyber experts strongly recommend any company, should ciation of Independent Tanker Own- for effective segregation of networks do to prevent cyber ers (INTERTANKO), International and servers where one stores critical attacks is conduct a Union of Maritime Insurance (IUMI) information. Hence, in case of one cyber security vulner- and Oil Companies International network or server coming under at- ability assessment. In addition, port Marine Forum (OCIMF). The second tack, it could be plugged off thus not operators, shipping companies and all edition includes among others new affecting the entire network or server. businesses reliant on information and practical advice on managing the ship Moreover, procedural control, network communication technology (“ICT”) to shore interface, and how to handle security, data classification and most must continue to implement security cyber security during port calls and importantly data backup remains key controls such as protective technology, when communicating with the shore to bring business back to normal at as well as develop operational proce- side. Similarly, the International As- the earliest. Maersk is in the small dures that include risk assessments sociation of Ports & Harbors (IAPH) group of companies which had at and asset management, awareness in its Annual General Meeting in May least devoted some time and resource

28 MARITIME GATEWAY / AUGUST 2017 economy. Hence, several steps need to CYBER ATTACK ANALYSIS BY VERIZON- 2016 be in place - also known as defense-in- WHO'S BEHIND THE BREACHES? depth to secure business. All systems must constantly be updated with the Perpetrated by outsiders. 75% latest upgrades and patches, and this should be a standard routing per- Involved internal actors. formed very quickly after each release 25% of patches. Elaborating the need to Conducted by state-affiliated actors. 18% give importance to IT infrastruc- ture, Lars Jensen, CEO, CyberKeel explained, “We made a study a week Featured multiple parties. 03% ago on a sample of ports showing that 20 per cent had not applied a Involved partners. 02% patch which is 2½ years old and protects against significant threats Involved organized criminal groups. identified 2½ years ago. The system 51% needs to have a high level of external cyber security, making it as difficult as WHAT TACTICS DO THEY USE? possible to gain entry into the system. But it must also be realized that the ex- Of breaches featured hacking. 62% ternal defenses will sometimes be pen- etrated. Therefore the internal network Over half of breaches included malware. must be configured in such a way that 51% even if I penetrate a computer in the company, then I cannot easily move Of hacking-related breaches leveraged either stolen and/or weak passwords. 81% further into the network. The third step is monitoring the network activity and being able to realize a cyber attack Were social attacks. 43% takes place, and if it becomes clear that both the external and the internal Errors were causal events in 14% of breaches. The same proportion involved defenses have failed, then quickly be priviledge misuse. 14% able to shut down everything. The final important layer is to have a very Physical actions were present in 8% of 08% solid back-up plan. We have for several breaches. years advised our client to have a con- tingency plan based on the assumption that everything is gone.” WHO ARE THE VICTIMS? Imagine a situation where data files, computers, communication sys- Of breaches affected �nancial organization. 24% tems - everything is gone. And then be able to re-start quickly from that point. Of breaches involved healthcare organization. 15% The situation could be scary for any business. Such an event is a realistic Public sector entities were the third most scenario, and have been seen not only prevalent breach victim at 12%. 12% in other industries before, but also on a smaller scale in the shipping industry. In order to test whether the defense Retail and Accommodation combined to 15% systems are set up correctly there is account for 15% of breaches. a need to perform penetration tests of both the external and the internal WHAT ELSE IS COMMON? defenses by very skilled hackers who in the last few years to improve cyber ogy which increases connectivity will perform such tests, and the results are security,of malw andare w theas installed fact that via maliciousthey can email be provide new opportunities and new used to quickly and efficiently improve so comprehensivelyattachments. shut down further risks in many industries,66% including cyber defenses. Indian port and ship- demonstrates the risk to the entire international shipping. Petya should be ping industry is slowly but surely mov- maritime sector. In much smaller a catalyst for shipping companies and of breaches were �nancially motivated. ing towards a paperless environment scale, there have in the past been ports worldwide to critically review73% but in the backdrop of cyber attack on cases of stolen data - usually used to the resilience of their operations to India’s busiest container terminal, and smuggleof breaches or steal were cargo.related to espionage. ransonware and other similar attacks. some other facilities in India and other Matthew Williams, Senior Ma- Petya 21%is not a unique event.” parts of the world, threat from cyber rine Adviser, International Chamber It is a transition time for Indian attack is getting bigger by the day. It of Shippingof breaches whasere wordsdiscover edof b ycaution third par ties. port and maritime27% sector as the coun- is time to consider investment in IT a for the trade. He said, “New technol- try slowly moves towards a digital core business strategy.

AUGUST 2017 / MARITIME GATEWAY 29 QCOVER & A STORY Dummy Dummy “PETYA IS A WIPER, NOT A RANSOMWARE” ASHISH THAPAR MANAGING PRINCIPAL - INVESTIGATIVE RESPONSE APJ AT VERIZON ENTERPRISE SOLUTIONS

Q Govt and organizations don’t take cyber threat seriously. How you look at it? Indian government sometime back initiated national cyber security strategy under the aegis of Dr. Gulshan Rai. But it requires lot related threat and on the other hand more in terms of strong outline, there are issues related to operational standards, and procedures to deal with technologies such as industrial control The worm originated in adversaries. Transportation is a critical system, radar, supervisory control sector, especially maritime industry system, etc, apart from many IoT Ukraine, and spread to where more than 90 per cent of world solutions that have been implemented various countries and trade is moved. If it is not consider as to optimize operation and business. reached India which critical infrastructure, then the focus is From regulatory standpoint the means may be Maersk missing in building a robust national industry was completely unregulated cyber security strategy. This industry and except laws of the land, there is no doesn’t has robust is not like banking sector where one protection or mandatory compliance network protection has regulators like RBI who make it requirement for this industry. mechanism. mandatory to have certain policies to Q The Maersk attack emanated keep check on ill practices. Few days from Ukraine and through the ago Singapore government came up company’s global network it reached with its new Cyber Security Law, India.In case of Maersk, it is blamed which has lot of focus on critical that the origin of the worm was a a ransomware but it was meant to infrastructure, and logistics industry patch of an accounting software be a wiper, so that the data is never was one of them. It is time the MeDoc which was used by one the recoverable. It is now being called Indian government should come subsidiary companies of Maersk more as nation-state cyber attack with up with clear guidelines and policy in Ukraine and through network it an intension to badly impact Ukraine. for some baseline control of critical affected the parent company. Being If a cyber attack of this scale is infrastructure such as logistics and prepared with disaster recovery unleashed against India, the maritime maritime sector. plan, robust back-up, preventive and and shipping industry will be severely Verizon's Data Breach Digest detective controls, and detailed instant affected. Indian shipping and port Report 2016, highlights the maritime response manual can help companies industry need to do a lot to sharpen industry involving CMS vulnerabilities to bring operation back to normal themselves to counter such cyber where Content Management Server in quick succession. Tight network warfare. In case of a cyber attack one was compromised which had B/L policies on firewall, and segregation should not pay any ransom as the of a shipping company. There were of networks to contain spread of virus word spreads very fast among the unauthorized download to identify to other parts of networks is needed. hacking community, and at the end containers carrying high value items. Since the infection spread to various one is inviting more attacks. Still in Q How do you look at countries and reached India which some cases companies end up paying preparedness towards cyber security means may be Maersk doesn’t has ransom but Bitcoins are expensive threat? robust network protection mechanism. and due to such incidents currently Current state of cyber security is It was not a targeted attack on it trades at US$2,600 per Bitcoin as very dynamic and complex. In one Indian shipping industry. In fact compared to few hundred dollars hand there are IT and cyber security if we go into the details, it is not some months ago.

30 MARITIME GATEWAY / AUGUST 2017 “REGULARLY UPDATE”

ALTAF HALDE MD (SOUTH ASIA), KASPERSKY LAB

Q How serious are future threats from Ransomware and other similar cyber attacks? How organizations can be better prepared? Victims often try to keep successful hacks a secret. The reason for this is or a document (like hot-chics.avi. that the maritime companies value exe or doc.scr). Regularly update their reputation more than the money your operating system, browser, With cargo operations they actually lose. In many cases antivirus, and other programs. Use a relying more on companies are unaware they have robust antivirus program to protect been hacked. Another problem is that your system from ransomware. If automation, cyber in cases of an onboard device hack, one discovers a rogue or unknown threat always looms many sailors are not ready to manage process on your machine, cut off the large. Certain procedural it. For instance, a GPS break can Internet connection immediately. If send a ship off-course while making the ransomware did not manage to practises always needs her appear to be on-course. This can erase the encryption key from your to be followed to secure lead to collision and delay in freight computer, there’s still a chance you business and minimise delivery. can restore the files. However, the loss. In a connected world, One should back up important new strains of this type of malware files regularly and check that back use a predefined key, so this tip, it is inevitable that there up copy is in good condition. unfortunately, would not work in will be security breach Cybercriminal often distribute fake that case. If you are unlucky to have email messages mimicking email your files encrypted, don’t pay the notifications from an online store ransom, unless the instant access to or a bank, luring a user to click on a some of your files is critical. In fact, malicious link and distribute malware. each payment fuels this unlawful This method is called phishing. Fine- business. If you have been infected, discovered in a software, also known tune your anti-spam settings and you should try to find out the name as zero day vulnerability. It is known never open attachments sent by an of the malware: maybe it’s an older as “zero-day” because zero time has unknown sender. Enable ‘Show file version and it is relatively simple to passed since the bug’s existence was extensions’ option in the Windows restore the files. Moreover, the police disclosed. The fewer the days the bug settings. This will make it much easier and cyber security experts collaborate has been known about, the higher to distinguish potentially malicious to detain the adversaries and provide the chances that it has no mitigation. files. As Trojans are programs, you file restoration tools online. https:// Organizations at risk from such should be warned to stay away from www.nomoreransom.org/ exploits can employ several means file extensions like “exe”, “vbs” and Q Why enterprise cyber security of detection, including using virtual “scr”.You need to keep a vigilant eye solution providers have not been able local area networks (LANs) to protect on this as many familiar file types can to deal effectively with the latest transmitted data, by making use of also be dangerous. Scammers could cyber threat? a firewall and using a secure Wi-Fi use several extensions to masquerade There are cyber attacks that system to protect against wireless a malicious file as a video, photo, occur on the same day a weakness is malware attacks.

AUGUST 2017 / MARITIME GATEWAY 31 QCOVER & A STORY Dummy Dummy “RECENT ATTACKS BY WANNACRY AND PETYA USED A 2 MONTH OLD EXPLOIT” ROHIT CHEMBURKAR CO - FOUNDER & CHIEF TECHNOLOGY OFFICER - VAMASHIP

Q What precautions the industry needs to take while shifting to a Web or cloud-based platform? Businesses that are moving towards Web and cloud based platforms should prioritize security. stolen. Disconnecting the suspicious It’s not just about going live on the machines from the internet and local Web, but one needs to ensure that network should stop the malware from The recent attacks by all best security practices are being spreading. Inform all stakeholders followed. It is difficult to estimate about the attack and to be careful WannaCry and Petya the loss caused due to these attacks, of opening any attachments that used a two month old as they could be direct and indirect could've been auto sent. Get an IT exploit. Microsoft had such as live systems being taken down security expert to check the infected released the security by the attacks and indirect being machines and identify the malware businesses that would want to go live and use an antivirus/antimalware to updates for those two on the Web and scale, but are deterred try and remove it, failing which one months ago. Computers by such attacks. would take a backup and reinstall all that did not update were Q Since cyber threats are here to softwares. stay, how one can minimize risk? Q How hackers have been able to open to the attack A business should always keep dodge cyber safety net? their software updated, mainly their The recent attacks WannaCry and Operating System. The Operating Petya used a 2 month old exploit. System should not be outdated, most Microsoft had released the security got affected, which as in the previous of the machines that got infected updates for those 2 months ago. question is an execution problem. with the WannaCry malware were Computers that did not update were Q What is your assessment of the older Windows Operating Systems. open to the exploit. So this is more of situation about data theft? Have strong Users Rights Policies on an execution problem at the enterprise Cyber criminals and Cyber security machines, so that even if users do cyber security solution providers’ end. experts are always trying to be one up encounter a malware, the malware Q Maersk Line and Hewlett- on the other, Cyber security experts won't be able to infect the machine. Packard Denmark had signed a $150 will create secure systems, cyber There should be a firewall which is million 5-year infrastructure services criminals will eventually crack it and updated to protect the entire network. agreement in 2011 to use HP’s then security updates will be released Regularly change passwords and cloud-enabled data centers. Is this a and this will go on forever. Many big secret keys. Keep strong password question mark on the robustness of firms like facebook and google invite policies. Keep regular backups of the cloud computing solutions? hackers to try and infiltrate their the business data. For websites, The 5-years infrastructure services systems, so that they can plug it before have backup servers, to which agreement would have ended in someone with malicious intent figures visitors can be redirected, incase the 2016. The cloud computing solution it out. There are ways to secure the primary server fails. Always encrypt at Maersk was not affected, it was data in databases, even if it is stolen sensitive data in the databases, the Service Desk function which HP it wouldn't be of any use to them and so that it can't be misused even if had taken over in addition, which this should be followed.

32 MARITIME GATEWAY / AUGUST 2017 COGO PORT

Offering shipping and allied services on a single platform is not new to India, but Cogo Port makes it frictionless by minimising people interface and sustaining the time and cost saving

by Deepika Amirapu

his clientele enjoy availing shipping services through his portal. The Digital Era of While the platform caters to ocean transport and air freight requests end to end, road transportation requests will be formally encouraged in a few Moving Cargo months from now once its list of 390 suppliers grows in strength. What ometime in the spring of 2017, Much like the aggregators in the road sustains Cogo Port apart from loy- Cogo Port began its journey transportation space, Cogo Port offers alty and quality service are identified Swhen Purender Shekhar decided an array of services for shippers want- sources of revenue streams for the to plant the seeds of this new logistics ing to move their wares from India services rendered. The customer is start-up in Ahmedabad. With Cogo, to other parts of the world. From a levied a convenience fee for using the which means to ‘bring together’ in curated list of suppliers and vendors, portal and the vendors have to cough Latin, he planned to do just that at shipper can choose to have his goods up commission after being chosen as a ports which are points of congregation picked up from his warehouse or service provider. for anyone who wants to move goods. factory and have them dropped to his This model of offering all shipping Today, almost six months later, customer’s preferred location overseas. and related services on one platform the firm’s business is growing at an What makes Cogo Port desirable is not alien to India with quite many astounding 25 per cent every month. by almost 1,600 customers is that the aggregators operating in the trucking Shekhar waved the technology before firm owns the responsibility of ensur- space. But ask Shekhar how he galvan- the shipping industry that was tech de- ing the services are offered efficiently ised his team of techies and shippies, prived in a sector where business was and the transaction process is com- he’ll tell you the names of two US mainly driven by old relationships and pleted. “Our services do not end with based firms – Flexport, a customs bro- dictates from the board rooms. For match-making once the shipper has ker and freight forwarder and Freigh- someone who has been part of the in- found his transporter. In fact, it begins tos, a similar firm from whom he drew dustry for more than two decades with there,” Shekhar says. his inspiration. “I want to make trade AP Moller Maersk and the Panalpina Once the shipper completes his frictionless in India through Cogo Group, he didn’t have to conduct an documentation online, he can view Port,” he says. From freight quoting to intense market research to see what all the processes that are underway on deploying large software systems and was missing. his personalised dashboard on the site. fulfilment technology, Cogo Port has “I wanted to sim- While Cogo’s Central Control Tower created a splash. plify logistics for the in Mumbai monitors all activity to Four months from now, newer shipper and the vendor. ensure the freight forwarders, custom markets in Gujarat will be services in So Cogo Port fits in the house agents and clearing agents com- addition to Ahmedabad. And come international logistics plete their tasks on time, the shipper March 2018, Cogo Port will be thrown chain that makes mov- can track his container real time too. open to all LCL, FCL and air freight ing goods from and to With all the documentation process operators and customers to do busi- destinations a child’s completed online without handling ness. “My vision is to ensure there play through a tech enabled platform,” papers and files, the shipper can focus is no scope for error by minimising Shekhar explains. Through a few on his business. Shekhar lists transpar- people interface and sustain the time clicks, he says booking space on a ship ency and convenience, operational and and cost saving of 48 hours for my has become as easy as booking an air commercial analytics and digitisation customers.” This perhaps is the sum- ticket on one of the online platforms. of documents as the three advantages mation of Cogo Port’s mission.

AUGUST 2017 / MARITIME GATEWAY 33 QQ & & A A

"IoT will drive greater Efficiency" The current trend in shipping is for focused solutions that solve issues like dwell-time management, empties management, integration between inland and ocean movements, and tracking of containers door-to-door.” by Omer Ahmed Siddiqui

Q How was INTTRA short transit times between transaction growth last regional ports. The velocity improve shipment year and in Q1, 2017? of container movement planning Although we have is higher with 2-3 day decisions, seen some improvements journeys between ports, so customer service in freight rates in the first adopting new technology and reduce cost quarter of the year, we will have a more immediate by tracking have witnessed disruption impact. valuable KPI’s, in services due to various Q Who are your active among other reasons, realignment of adopters? Where is most of features. We alliances and shortage of the business coming from? also published equipment in some regions Shippers, freight a white paper - which have dampened the forwarders and carriers are ‘Blueprint 2032: market. adopting new technology How Technology For our business to digitize many of the Transforms growth has been driven shipping processes, such Ocean Container by increasing adoption of as booking and tracking a Shipping.’ technology in the container container on a vessel and INTTRA sees shipping sector. Last year the logistics of working three technology we enjoyed 15 per cent with the land operations. trends converging growth in volumes and Asia is the fastest growing in the near expect it to continue into region. term: Network 2017. Q When new SOLAS integration Q How is the pace of guidelines came on across systems, technology adoption in VGM you came up with applications and shipping? What are the eVGM solution. But partners: Technology such trends in Asia Pacific VGM enforcement seems and it has helped us further as Blockchain will simplify market? to be not very effective. our development of other transaction processes and Carriers and freight Comment? digital solutions that can reduce costs; Real-time forwarders are turning to To spark industry support our growing status of containers and technology to eliminate collaboration, INTTRA customer base. cargo: Tracking devices waste, improve customer launched the eVGM I think when any global connected by the “Internet service, reduce manual Initiative, a non-commercial regulation is introduced of Things driving greater labour and streamline the group consisting of more it takes time for the efficiencies and improving industry. than a dozen leading authorities to put in place shipment planning; Intra-Asia shipping is carriers, freight forwarders, the necessary enforcement Artificial Intelligence: world’s biggest tradelane ports and terminals working network. A.I. will enable companies in terms of volume. The to develop technology and Q What is new at to transition from big complexities of shipping business process standards INTTRA? data to more accessible are many given the to foster industry-wide Earlier this year we business analytics that will multiple borders, customs compliance with SOLAS launched 'INTTRA suggest higher probability procedures and relatively VGM. It was a success dashboards' that helps to outcomes.

34 MARITIME GATEWAY / AUGUST 2017

CRUISE TOURISM

ruise tourism is the driver of growth in the areas touched by Cit. Ocean cruises have impact on ports and the area within 50 kms of the port. River cruises have the poten- tial to foster economic development along the route. “India is an emerging market and with cruise holidays gain- ing popularity the number of passen- gers is on the rise and this is a trend I foresee continue into the coming 3-4 years,” reveals Kunal Sampat, Gen- eral Manager - India, MSC Cruises. In the last one year we have noticed people cruising from Mumbai to Cochin and then to Mali or Colombo. Earlier the ships used to be full with foreigners and NRIs, but now Indians are also boarding the ship from Mumbai, reveals Girish Thomas, Sr. Dy. Traffic Manager, Cochin Port. In 2016-17, cruise vessels made 158 calls at ports in Mumbai, Cochin, Goa, New Mangalore and Chennai. Very few people (about 130,000 to 140,000 annually) opt for cruise tourism in India and the number is less than one per cent of the total market. In 2014-15 a total of 1,04,125 cruise passengers were handled at five major ports which increased to 1,25,838 The Cruise and during 2015-16 achieving a growth of 20.85 per cent over the previous year. In 2016-17, about 1.92 lakh cruise passengers embarked/disembarked at major ports. The country has poten- The Golden Egg tial to grow to 1.5 million by the year 2031-32 and by 4 million by 2042-43. About 300-400 passengers boarded Cruise tourism is an emerging sector in India with a cruise from Cochin Port last year huge potential for contributing to the national and the number of transit passengers was around 60,000 to 75,000. Ac- economy and generating employment. The winds cording to Girish Thomas, “About seem to favour the industry as the government has 45 cruise ships called Cochin port in 2016, compared to 35 calls in 2015. raised the sails to give a major push to the sector Big cruises like Queen Elisabeth call at by framing a favourable policy to make cruise only Cochin Port as they are too big to call at any other port.” tourism attractive and hassle-free Pointing at the merits of his port, Girish says, “Cochin has a full-fledged terminal for cruise wherein all opera- by Omer Ahmed Siddiqui tions like Customs and immigration clearance can be done under a single roof. E-visa facility is available at the port and it offers up to 30 per cent discount to the ships.”

36 MARITIME GATEWAY / AUGUST 2017 CRUISE VESSELS HANDLED AT MUMBAI, MORMUGAO, COCHIN, NEW MANGALORE AND CHENNAI PORTS

2013-14 2014-15 2015-16 2016-17

103 139 128 158

New travellers: A lot of new trav- wide. Of those, more than 100,000 ellers, when they go to Europe or any flew to Singapore and cruised to pri- place new, covering many destinations. marily Southeast Asia. As indicated, The process of figuring out transfers, Singapore remains the top cruising immigration can be a bit daunting. The destination followed by Western ship to some extent holds your hand in Europe (Italy, Spain) and then Alaska bringing you to your destinations thus and Miami/Orlando. Dubai is a new avoiding too many transfers, while al- destination gaining popularity. lowing the traveller to see many places Cruise season on one holiday. Cruise season extend from October Corporates: A cruise ship is an to April-May. Not surprisingly, the easy venue to balance holiday and peak rush tends to be around holi- work for corporate events. There is days/wedding season, so the main easy access to meeting rooms, confer- periods are around Mid-April, May, Demography ence centres, auditoriums, cocktail mid-June), Diwali (October, Novem- At present, Indian cruise market venues and entertainment. ber) and Christmas/NY (December, is significantly dominated by Inter- Elder persons: You only have to January). national passengers. However, with manage getting on and off the ship Measures taken by govt Costa Neoclassica partial coastal even when visiting different locations SoPs for handling cruise vessels (Indian ports) deployment, has seen you don’t have to catch different flights and passengers have been implement- exponential rise in Indian passengers. or check in different hotels. ed. Foreign flag vessels are allowed to The dominant age group is generally Cruises calling Indian ports call at Indian ports without obtaining in the 30-45 years range. The next Since last season, Costa under Car- license from DG Shipping. Port-level closest bracket being 60-75. The age nival Corporation is the main operator Committees have been constituted to group also depends on the destination. in India. Apart from this, other cruise address manpower, coordination and Alaska and Europe would be on the corporations such as AIDA, Prin- logistics issues. A rebate of 30 per cent older side and Singapore would be on cess, Seabourn, HAL, Cunard (under is given at Major Ports in Port charges. the younger side. Carnival Corp.), Celebrity, Azamara, Additional rebate of 25 per cent is for Why opt for cruise tourism? Tui (under Royal Caribbean Corp Ltd) home port cruise vessels in addition to Hassel-free means of travel and and Reagent Seven Seas (Norwegian 40 per cent rebate for coastal cruise. E- tourism – luxury, adventure, entertain- Cruise Holding) called Indian ports for Visa facility is extended to five major ment, food, medical and all essential few calls. ports. Proposals are made to introduce amenities under one roof is the key The GSAs include Thomas Cook, e-Landing card for cruise passengers. for choosing cruise tourism. Security SOTC (including Kuoni), Cox n Kings The number of days a cruise ship can in terms of time and money, and and DePauls. The consolidators for dock has been increased to three. stress-free adventure are the two main specific cruise liners are Ark/Guide- “None of the Indian ports can reasons. line for Star Cruises (Celebrity), Tirun be currently termed as a full-fledged Families: Cruise ships offer baby- (Royal Caribbean), Lotus Destination cruise terminal. The government sitting and kid’s entertainment, making (Costa), Sharaf travels (MSC). should also cut down the tax structure it a relatively convenient option for Cruise destinations which is quite high,” remarks Kunal. families. So, kids may be left in the Popular destinations for Indian Cruise Tourism Policy kids’ club, while parents are watching travellers are the Mediterranean (east The government is working on a the evening shows and grand-parents & west), North Europe. In 2016, some cruise tourism policy to increase the are lying in. 120,000 plus Indians cruised world- cruise liner traffic to India 10-fold to

AUGUST 2017 / MARITIME GATEWAY 37 CRUISE TOURISM

700 vessels a year. “Cruise tourism can KEY RECOMMENDATIONS BY A GLOBAL CONSULTANT FOR be India’s economic growth engine DEVELOPING CRUISE TOURISM IN INDIA and it has vast untapped potential. In a month, shipping ministry in collabo- STRENGTH OPPORTUNITY ration with tourism ministry is going to bring India’s first cruise tourism • Framing long-term cruise • Strong brand – Incredible policy,” announced Nitin Gadkari, business strategy India Minister for Road Transport, High- • Rich in history, culture and • Focus on delivering ways and Shipping. attractions outstanding passenger To start with, five ports – Mum- • Potential for good revenue experience bai, Goa, Mangalore, Chennai and from shore excursions • Create awareness and Kochi – will be developed as cruise • India is a tech savvy country demand for India as a cruise hubs. World-class berths for cruise / ease to modernize systems destination ships will be developed and security and immigration procedures for tour- • Improve service and attitude ists will be simplified. Modern cruise and create a new awareness WEAKNESS terminals being developed at major at national and international ports will include hospitality, retail, level • Little demand from India as a shopping and restaurants, while about cruise destination • Clearance and immigration 200 minor ports will develop jetties. procedures to meet Currently cruise tourism is not taxed • Visa process is lengthy, international standards and the shipping ministry has asked to complicated and expensive • Assist cruise lines and India exempt cruise tourism from GST. • Clearance and Immigration stakeholders to make more Key recommendations by a global procedures are lengthy, revenue from tours consultant engaged by the ministry of complicated and shipping for promoting cruise tourism: inconsistent from port to • Tourism board to develop a (i) Single window system for all port cruise strategy targeting B2C pre-cruise requirements for • High port fees based on and supporting B2B (together with ports, operators, agents) cruise operators like entry of Gross Tonnage vehicles, personnel and guides • Attractions located far from • Product development electronically, doing away with ports for cruise to be done at checking of registration, license destination level • Ports not adequate for cruise papers of vehicle each time. • Guide training programmes • Cabotage restrictions for (ii) Create a dedicated approach Indians to travel in Indian • Port authorities to assign road and entrance to the cruise itineraries (shorter cruises cruise manager for each port terminals. are most preferred by • Cruise coordinators to be (iii) Uniform and consistent security Indians) assigned for each destination procedures by CISF at all ports. • Passenger experience is • Expand river cruise activities (iv) Adequate security and access to damaged by complicated the port for passengers over- immigration and security • Port infrastructure developed night and while visiting local processes at the pier for cruise operations and venues. future expansion (v) Security checks for embarking THREAT • Develop cooperation with Sri passengers would be done only Lanka, Maldives and Arabian once. Gulf ports • No changes and (vi) Use of technology for clearanc- improvements on • Implement berth allocation es, providing passenger mani- regulations and processes policy fest to CISF and doing away • Excess bureaucracy remains • Develop new ports and with manual time-consuming an obstacle destinations in India process. • No development on port • Improve tender facilities to (vii) Implementation of green lane/ infrastructure access islands and small red lane at existing terminals ports with random Customs check- • Cruise terminals being built ing. are not aligned with the • Regional partnerships to future operational needs of expand market can be made (viii) Declaration of only limited the mega liners (over 4000 with Muscat, Male, Colombo, items of inventory of the cruise pax) Port Blair, Singapore, etc. ships in place of the existing requirement of having the com- • No cooperation between the plete inventory for all the stakeholders stocks.

38 MARITIME GATEWAY / AUGUST 2017 Q & A

"Focus is more on rail and inland water transport" Odisha has climbed 40 per cent points in business compliance. Increasing investment in diversified sectors, diverting more cargo from road to rail and waterways are on the cards. by Sisir Pradhan

Sanjeev Chopra, IAS Principal Secretary, Industries Department, Govt. of Odisha

Q What are the major logistics state government wants to increase business. The state has climbed 40 per challenges raised by the industry? investment in other sectors as well. cent points in business compliance, Major logistic challenges are For which a 10-year plan, named 52 per cent in the year 2015 to 92 per primarily for the movement of bulk as Vision-2025 was started in the cent in 2016. We are leveraging from cargo which is largely by road. The year 2016. The focus is to identify technology, so that there is no physical government is planning to shift road new sectors where investment and touch point between the investor and cargo to rail and inland waterways. industrial growth can be encouraged. government, or rather to reduce to The National Inland Waterways No As a result, around six sectors such as the minimum extent. We have a land 5 is going to connect coal fields to the Ancillary and Downstream Industries bank of 100,000 acres mapped on a ports at Dhamra and Paradip. There in Metal Sector; Chemicals, Plastics GIS platform. The entire inspection have been allegations that freight and Petrochemicals; Electronics system is being monitored through rates for moving bulk cargo by road Manufacturing; Food Processing online portal. For example, inspectors are being cartelized. We have formed including Sea Food; and Textiles and of various departments visit respective a rail company - Mahanadi Coal Apparel, among others have been industries on a pre-determined Railway Ltd for faster evacuation identified for investment promotion. date, and the inspection reports are of coal. The state government has Just before the Make In Odisha uploaded onto a Web portal within been very proactive in using state investors’ summit the state cabinet 48hrs. After allotment of land, if an resources to develop rail network. For passed about nine sector specific investor wants any change, it could a long time major rail networks that policies to facilitate investment. The be done online. Similarly, around 14 Odisha had was Kolkata-Mumbai state also extends various incentives government services have been shifted and Kolkata-Chennai railway lines. and other eco-system at par with to online platform. The focus is to The state is intending to improve rail other states. Moreover, the extension leverage on technology to bring network in the hinterland for freight of Easter Economic Corridor upto down project approval time. For movement. Once the new eastern Kolkata will include Odisha, and the example, any green category industry economic corridor comes up, it will government aims to leverage from which fall under non-polluting make cargo movement easier. this. The spine of the corridor is category can be sanctioned at my level, Q Which are the major industries national highways from Kolkata to and later it may go to Chief Secretary that the state government is focusing Chennai and state is in the process or Chief Minister for ratification if on for investment? of identifying 6 manufacturing and the project involves high investment. The state government looks to economic nodes where manufacturing Projects falling under non-green increase the base of industrial growth infrastructure will take place. category go to Chief Secretary where in the region. Primarily industrial Q How would you rate business it takes maximum 30 days for growth in the state in the last many facilitation and approvals in Odisha clearance, though the state govt is decades has been around metal and as compared to other states? trying to cut down the time in this mineral-based industries, but now the Odisha is stressing on ease of doing category as well.

AUGUST 2017 / MARITIME GATEWAY 39 REGULATIONSQ & A

to immediately implement the agreement, on the other hand the developing countries and under- developed countries have been given some relaxation in the form extended time. India being a party to the agreement is abiding by the norms. As a EXIM stakeholder if you are curious about the heightened activities launched by the government in the name of trade facilitation such as use of electronic payment, authorized operators’ schemes, procedures for expedite shipments, and reduced documents, etc it is nothing but streamlining of processes inline with TFA. Hence, to stay relevant in the changing dynamics of global trade it is mandatory for all partners in the EXIM trade to accustom themselves with the processes of TFA and be ready to embrace the change or Ease of trade become irrelevant to the trade. One of the major thrust areas under the TFA is to harmonize Customs laws between countries forcing the department to through TFA stress on effective cooperation between customs and other authorities on trade The TFA entered into force on 22 February 2017 after facilitation and customs compliance two-third of the WTO membership completed their issues thus expediting cargo movement, release and clearance of domestic ratification process. It offers greater trade goods, including goods in transit. The TFA after complete opportunity to those who are ready to undergo implementation by all parties is estimated to reduce trade costs by an change to stay in compliance with the TFA norms. It average of 14.3 per cent. Simplification will force all stakeholders, including the government of procedures will also impact the entry barrier in a positive manner thus agencies, to go through great change attracting newer entrants in EXIM by Sisir Pradhan trade. WTO expects that after full implementation, export of newer products from developing countries will ne of the primary principles internationally accepted processes set rise by 20 per cent, and underdeveloped of the trading system under under the TFA. In developing countries countries by 35 per cent, and global OWTO is to provide a level where bureaucrats have a multi-layered trade may increase by up to $1 trillion playing field to all member countries. strangling hold on cargo movement each year. India on July 20 announced Its aim is to eliminate all sorts of processes will be abide by the norms National Trade Facilitation Action discriminations and remove tariff and of TFA. Plan putting emphasis on reducing non-tariff barriers. Meanwhile, other After years of meticulous cargo release time. There couldn’t be than the protectionism, the second negotiations, finally TFA got a a better time to expand the ambit of biggest hurdle in global trade scene is physical form in December 2013 at trade for both existing and new entrants red tapism where cargo clearance and Bali meet. But it took some years as countries all over the world have release are at the mercy of bureaucrats. to streamline commonly accepted agreed to facilitate trade and give a It sowed the seed of harmonizing processes, and finally TFA entered level-playing ground to all participants. rules and regulations for cross border into force on 22 February 2017. As the However, it will also increase movement of cargo, thus the concept name suggest, TFA aims to facilitate competition in the international market of floating a uniform law came trade through simplification of and those who adapt to the change into picture clearing path for Trade regulation, contemporary approach to in the shortest time frame will only Facilitation Agreement (TFA). Goods cargo movement and harmonization succeed. It is time for all stakeholders clearance will no more rely on whims of export and import processes, of EXIM trade to take stock of the and fancy of government officials including Customs regulations. situation and streamline processes rather it will be as per the norms of Developed countries have committed inline with the TFA.

40 MARITIME GATEWAY / AUGUST 2017 Q & A

“PRO-ACTIVELY COMPLY TO TFA REGIME” A major milestone for the global trading system was reached on 22 February 2017. While Trade Facilitation Agreement (TFA) aims to facilitate trade between countries and ease non-tariff barrier, it is going to impact all stakeholders in EXIM trade and everyone should prepare themselves to

Samir J. Shah embrace the change Chairman, Federation of Freight Forwarders Association in India by Sisir Pradhan

Q How Trade facilitation The deferred payment of duty has its used to undertake earlier will come Agreement will impact EXIM and roots in the TFA. TFA for the first time down significantly, hence affecting service sector? has made provisions to separate release his earning. Even the number of The WTO-Trade Facilitation of goods from clearance of goods. It is consignment being processed earlier Agreement (TFA) has come into a positive development that Customs through them will come down. Due to force on 22nd February 2017 in for the first time incorporating terms which Customs Brokers have to think member countries, including India, like ‘release’ and ‘clearance’ in its about strategy to realign their existing but India has 1 year time to complete clause. It is important for importers work force as the job done at their all processes. Some countries and exporters to keep all paperwork end will come down. There will be depending on their status have about ready in advance involving all requirement for better qualified staff. In 1-5 years time period to streamline participating government agencies. case of custodians, the number of cargo all processes and compliance. The Q How will it impact service they used to handle will come down effect of TFA varies depending on providers like Customs Broker? due to introduction of concepts like the sector. Exporters and importers In case of service providers like DPD and RMS. Hence, custodians also have to plan meticulously with regard Customs Brokers, they have to accept have to reinvest their business model. to all documentation in compliance a new role in working which will be a Now, even the cargo carriers with TFA. There have been some depart from the past. Previously, the (shipping lines and airlines) also have changes in the process post-TFA, for practice was that relation management to realign their business. They have to example, for import consignment for a Customs Broker with Customs practice a lot of discipline and bring in Customs has introduced a new section official was very important whereas clarity in IGM and EGM that comes where if importer doesn’t file Bill post-TFA there will be lot of stress from their end, including adherence of Entry within 24-hours of arrival on technology and filing. Hence, to strict timeline and penalty involved of goods, it will attract late filing compliance of norms will have greater in it. In the past, consolidator had charges. In a bid to make amendments role, and if there is a mistake in filed never took Customs clearance very transparent, government has notified document, it can only be corrected by seriously, but they will be forced to rates in terms of penalties to be paid paying a fee. Due to which correction change with the introduction of a for amendments in shipping bill. in documents will be an expensive number of penalties for amendments Hence, amendments are going to be affair. Moreover, with RMS, Deferred and late filing. Hence, all 18-19 stake expensive in the Post-TFA era. The Payment of Duty and Direct Port holders who are typically involved in positive development is that shipper Delivery coming into the picture the the movement of EXIM cargo have to gets an assurance of hassle-free cargo number of processes involving import undergo change to stay in compliance clearance if all paper work is in place. and export that a Custom Broker with the TFA regime.

AUGUST 2017 / MARITIME GATEWAY 41 TERMINALS

urrently India has 20+ opera- tional container terminals and Cis annually handling about 12 million teus. At present none of these terminals is fully automated. Also, amongst the upcoming 3 new con- Do we need tainer terminals 2 are on conventional design and the 3rd which is first of its kind transshipment container terminal at Vizhinjam is being conceptualized to be a fully automated Terminal. The automated strategic decision to opt for a “fully au- tomated container terminal is not only a visionary business call but also takes into consideration key business facets viz. technical requirement, volumes to terminals? be handled etc. The fully automated container India needs fully automated container terminals terminal is established considering: to meet the growing exim cargo requirements • 24 hrs/day operation philosophy with set climatic condition param- to speed up movement at terminal and at the eters • High reliability of operations gate. This article explains what kind of model • Either to reduce or eliminate human interface for the terminal we should adopt. operation including operations of B T Shah the container handling equipment. • To attain the highest level of safety VP - Equipment Engineering Division, (Retd.) of the operation and Howe Engineering Projects India Pvt Ltd. • Enhance competitiveness by using the information technology The container terminal operations (conventional/automated) are divided in three zones: • Sea side (quay side) operation. • Storage-yard operation. • Land side operation (gate operation) Sea side operations The sea side operation shall be car- ried out by rail mounted quay cranes or ship to shore (STS) crane. The terminals install the STS cranes based on the ship sizes. The size of the crane has an impact on the wharf design and terminal lay out as well. There is a thumb rule that crane outreach is twice the length of the crane rail gauge for better stability (however this is not mandatory). That means 30 m rail gauge can have 60 m outreach; 35 m rail gauge can have 70 m outreach. The back reach of the crane shall be decided by the operation requirement. If operation is carried out between the legs of the crane, back reach opera- tion is only for handling hatch covers. That means back reach of 15m to 20 m is sufficient. Apron size is thus minimized. All conventional container terminals are operated between the legs. As operation is carried out with in the legs, crane hoist trolley also moves

42 MARITIME GATEWAY / AUGUST 2017 with in the legs. The pinning operation throughput performance of the STS If we assume that the container is also under the nominated line side cranes. The operative cost will also re- terminal capacity is about 2 million between the legs. main same as benefit of reduced man- teus having 9 STS cranes. About 6 to The automated container terminal power is offset by increase of qualified 7 such automatic vehicles are required calls for back reach operation. This is maintenance crew as it becomes more per STS depending upon the yard because, automated container terminal complex. layout and distance to be travelled has horizontal transport system. The The conventional operation has for each vehicle. That means termi- automated vehicle requires flawless drawback of terminal efficiency. nal requires about 58 such vehicles. instrumentation and communication Manual entry of container operation If terminal capacity increases in the system. Under the crane umbrella data can be verified online real-time future; number of the equipment both (between leg operations), the com- by installing OCR on the crane. The cranes and automatic vehicles are pro- munication system is not flawless and cost of OCR may be in the range of portionally increased. But marginally chances are more to break or delay the $75,000 to $100,000 per crane. The cost increase on navigational system. communications. The trolley path is capital investment increment is about The fuel cost is also lower than the also increased, means more cycle time, 1.5% but it pays back as operational conventional chassis system as chassis less productivity. efficiency is at par with automated is operated on diesel oil system. Therefore, STS cranes for au- terminal. The conventional Terminal is us- tomated Container Terminals are Therefore my opinion is for STS ing tractor chassis for the horizontal modified for productivity and safety crane operation between the crane transportation. As a thumb rule each aspect. The STS crane has bigger legs and equipped with OCR for STS crane requires about 7 chassis back reach and rail gauge is about 30 automatic registration and verification for matching output. That means for m. The STS crane is equipped with of container for terminal size up to 2 9 STS cranes requires 63 chassis. As double trolley system and pinning million teu. chassis is operated by operator, operat- station on the crane. The main trolley Horizontal transport system: ing in 3shifts requires 35 per cent more operates either with operator on-board The conventional container operators to cater weekly offs and or remotely. The main trolley lifts the terminal uses the tractor chassis for compensate the leaves. That means container from the ship and delivers the container movement to and fro 255 to 260 operators are required. on the pinning platform. The total from yard. The automated container Any increment in capacity, this figure travel cycle is automated only release terminal calls for automated Guided is also revised. Though Terminal is or start has human interface. The 2nd vehicle (AGV) or Lift-AGV (LAGV); enforcing all safety measures; there trolley lifts the container from pin- Auto Shuttle Carrier (SC), or auto- are chances of the accident to occur. ning station and delivers to horizontal mated truck-carrier (under invention). The probability of occurring accident transport vehicle. This operation is All these type of the vehicles are is depending upon the psychological fully automated. Same way it takes equipped with high-end technology state of the operator mind which is delivery from Vehicle and delivers on and terminal need to have very good hard to predict and taking corrective pinning station for export container. infrastructure for communications and measures. The vehicle system is also This automated function is carried out navigational system. The success of not eco-friendly and Terminal has by TOS (Terminal Operating System) these is only possible if planning and to work on reducing the carbon foot carefully integrated with crane operat- scheduling is carried out efficiently prints. The reliability of the chassis ing system. The updated TOS shall with TOS system. Therefore a hand system is based on the operator func- give command to crane PLC for the on knowledge and experience of TOS tions and it gets changed with turnover execution of said operation. The Au- system is prerequisite. of operators. Many Terminals are tomated operation calls for the other The capital cost of AGV/LAGV offering incentive schemes to operators system like OCR (Optical Character in tune of $0.7 million (the auto for achieve set reliability. reader) system, Laser sensors and shuttle cost is also about $0.75 to 0.80) The AGV/LAGV or auto SC calls camera system mandatory require- whereas the chassis with tractor head for STS back reach operations and ment on the crane. costing not more than $80,000. The yard operation as end serving. These These extra features of STS crane price difference is very high. are the main impact on the terminal increase its cost by at least $2 to 2.5 Operation comparison of automated lay out and operation philosophy. million (the base crane cost suitable & conventional horizontal transpor- The conventional Chassis operation for 23 across container ship). The STS tation system calls for between leg operations and crane performance shall not change The automatic vehicle as name suitable also for back reach operation. much compared to conventional termi- suggested operated without any However the drawback is of Labor nal STS crane. However the terminal operator. The onboard navigational intensive. efficiency may be increased due to system navigates the vehicle to target What shall be the forward path? correct data entry as it takes automati- and target assigned by TOS. Being If Terminal is designed for maxi- cally and checks/verifies online real operated automatically with set norms mum 2 million teus handling per an- time basis. and conditions; there is absolutely no num, I prefer to select chassis system Is it worth spending? chance of any accident. The Terminal with certain modifications. The GNSS The capital expenditure is nearly has to be operated as a whole with systems (GPS based system) is incor- increasing by 30 per cent and there laid down SOP (Standard Operative porate with each chassis so that one shall be no visual benefit of sea side Philosophy). can monitor effectively each and every

AUGUST 2017 / MARITIME GATEWAY 43 TERMINALS

chassis. So tailor made navigational ERTGC & chassis operation is about monitoring system, shall control the AUTOMATION USING STS CRANES US $ 9/box. Whereas CRMGC & over speeding and under speed; thus STS cranes for automated Chassis operation put together may accidents and delays. Also it helps to Container Terminals are modified be considered as $9.5/box. The ASC find out gray vehicles in the opera- for productivity and safety aspect. + AGV combination operating cost tions. One has to explore the feasibil- The STS crane has bigger back considered as $8/box. ity of the gas based engine fuel system reach and rail gauge is about 30 The Terminal yard layout planning to replace the diesel fuel. m. The STS crane is equipped shall confirm the total numbers of The selection of horizontal trans- with double trolley system and the equipment requirement. The E- portation system is playing a major pinning station on the crane. The RTGC layout requires more land and role for finalizing the terminal yard main trolley operates either with more number of units than ASC and layout. At later stage it becomes too operator on-board or remotely. CRMGC. One such analysis is show- costly or may be unviable to change The main trolley lifts the container ing that about 25 per cent more units the layout of the yard (operational dif- from the ship and delivers on the are required than that of ASC and ficulties). Therefor if we are planning pinning platform. The total travel C-RMGC for same Terminal capacity. 2-5 million teus Terminal, one should cycle is automated only release Therefore virtual E-RTGC costing is go for fully automated Terminal. This or start has human interface. The $1.875 million/unit while comparing is mainly due to safety and reliability 2nd trolley lifts the container from cost of ASC and C-RMGC. of operation with set productivity pinning station and delivers to To make the yard automated with norms. One cannot keep reliability horizontal transport vehicle. This E-RTGC option using Tractor chassis of performance with conventional operation is automated. Same way system as suggested above. The E- operation with large labor force and it picks from vehicle and delivers RTGC shall be automatically operated manually data entry. For less than or on pinning station for export and only remote operation is with up to 2 million teus above mentioned container. This automated function interface of the tractor chassis. By this modified chassis should be used as is carried out by TOS integrated we can optimized about 65 per cent of horizontal transport system. with crane operating system. the E-RTGC operators. Operational If terminal having growth plan in Reliability and operational efficiency near future above 2 million teus, then is also increased as manually data one should consider the Auto Shuttle entry is eliminated. The capital cost Carrier for future consideration. This of E-RTGC may be increased to $1.9 shall not much alter the yard layout. system as truck chassis or shuttle car- million/unit and virtually cost $2.35 After sacrificing some ground slots; rier. million/unit. the block can be converted into end The third option is with RTGC. Gate operations: serving system if required. The STS Most of the conventional container Automated gate operation ensures operation remains between the legs terminal is operated with RTGC. The high security and access control with customized instrumentation. RTGC is now available up to 7 rows along with high speed processing of What about yard equipment? + truck lane. The only drawback is container. There are established solu- Automated yard prefers ASC (Au- the gantry speed cannot match with tion providers available in the market tomated Stack Crane). The ASCs PLC CRMGC and ASC. Earlier RTGC was and system reliability as good as 98 gets the task from TOS and ASC also powered by onboard diesel engine but per cent. Most of the OCR portals acknowledges the completion of task now days RTGC is available with lots can satisfactory work up to maximum to TOS. The advantage of ASC is that of option for Yard power system (such speed of chassis as 10 m/s which is we can have dense stack yard (say 10 as Low or High BUS BAR system, equivalent to 36 km/hr. Most of the to 12 rows of containers and 1 over 5). cable reel system, energy chain system Terminal has chassis speed restriction Worldwide ASC are operated as “end etc). There are also options available 30 to 40 km/hr. inside the gate. The serving” lay out. Due to end serving, it for auto steering system. As there Gate automation increases the process prefers to have AGV/LAGV or shuttle is dedicated truck lane for RTGC, efficiency with fewer system operators. carrier as horizontal transporter. Automatic operation is just like same Terminal has to invest for gate auto- The other option is CRMGC as CRMGC. The only difference is mation system. (Cantilever type Rail Mounted Gantry communication system. The CRMGC Conclusion Crane). This CRMGC is not designed is generally designed with fiber optic India needs a customized automat- for end serving. The vehicle lane is cable for control and communication ed container terminal system. Sea side planned in yard layout and CRMGC purposes whereas RTGC is designed requires up-gradation of conventional shall pick/drop the container from/to with high speed wireless system. operation. Horizontal transportation the vehicle. The CRMGC is operated The ASC is costing about $2.6 mil- based on the terminal size shall use automatically but has human interface lion/unit; The CRMGC costs about tractor chassis with option to have operation with pick up/ drop opera- $2.9 million/unit whereas E-RTGC LNG/CNG fuel and incorporated tion at vehicle interface. This opera- cost $1.5 million/unit. The civil cost with GNSS system. Terminal size up tion shall be carried out remotely. One of ASC and CRMGC is also more due to 2 million teus per annum; RTGC operator can control 3 to 4 CRMGC to rail system. Therefore lower capital with yard power system, automatic at a time. This option facilitates the cost is with E-RTGC system. yard is to be right choice. The gate operation with horizontal transport The operative cost, considering system must be automatic.

44 MARITIME GATEWAY / AUGUST 2017 DATELINE SRI LANKA

Connectivity among nations is gray area A gray area in South Asia is connectivity among the nations and to rest of the world, which is far below global standards. Investment in shipping and logistics sector will boost trade, create jobs and improve the economy.

outh Asian nations in the Indian subcontinent along with the Bay of Bengal region account to 2 billion plus people. The region Slies between the Middle East and East Asian mega city states of Dubai and Singapore which are now considered developed and mature economies. Both these two mega cities are now considered among the top 25 of the most expensive cities in the world making South Asia the next best destination for shipping and logistics services. South Asia has been the weakest link in Asia in terms of economic prosperity as many millions are still considered to be in the poverty circle, however things are now gradually changing and the thrust for reforms and investments are evident as pressure on unemployment and inequality are major challenges that the governments of the regions are facing. Given a relatively young population that can be trained with skills and knowledge and the region being one of the low-cost geographies Rohan Masakorala of the world is poised to get the attention of the global capital as all CEO, Shippers' Academy Colombo indicators are towards expansion of industry led growth. The “Make in India” slogan itself speaks of the vision of the major economy in South Asia. Whilst all the signals are positive and South Asia is poised to create more wealth, it needs to embrace the fact that it has to transform into a As the region globally competitive region and must have good connectivity and access for speedy delivery of goods and services to markets. This is a gray area is ranked low in South Asia as connectivity among the nations and the rest of the in logistics and world is far below global standards. Investing in shipping and logistics shipping indices is a massive requirement as pointed out by both the World Bank and Asian Development Bank in their reports. As the region is ranked low and the base of in logistics and shipping indices and the base of performance is low, the performance is gaps remain high and a huge challenge for countries across South Asia low, the gaps is to move forward to create the industrial base it needs where there is abundant labour availability. remain high and a huge If the governments and the policy makers and drivers take the challenge for countries right decisions and invest in the maritime and logistics industry, more across South Asia to move employment can be created to the young generation of the South Asian countries. The maritime and logistics related jobs in the supply chain can forward is to create the be very attractive and would create better jobs to uplifting the standards industrial base it needs of the region’s productivity. The need of the hour is that industry leaders where there is abundant must take the initiative to make the mind set changed among political leaders and make them aware of the befits that proper a shipping labour availability. & logistics industry along with trade facilitation can bring into the development process.

AUGUST 2017 / MARITIME GATEWAY 45 Q & A

“Shorten the time taken to get containers on and off the vessel” India has emerged as a key supplier of generic and affordable medicine. Yet, a few deterrents on the land side hang up smooth flow of operations at ports. Jayant Tagore, President of The Bulk Drugs Manufacturers Association of India outlines the key challenges pharma Jayant Tagore companies face while importing raw materials President of The Bulk Drugs from other countries. Manufacturers Association of India by Deepika Amirapu

Q How would you categorise the challenges faced by importers of active pharmaceutical ingredients and drug intermediaries? The delays we face in clearing both imports and exports at the customs end affects our operations. Most times, the customs interface ICEGATE that oversees filing of documentation fails The challenge is mostly to do with offloaded from the vessel. Any delay and importers are unable to file the throughput time when we import and has repercussions on the cost. Just Bill of Entry and other documents. A export our products. The time taken destuffing a container and loading delay at this juncture has a cascading to get containers on and off the vessel them on to trucks costs us a lakh per effect on other procedures as well. needs to be shortened so we can save box. Q Why do most imports come on our inventory costs. Typically, we Q What changes would have to through Chennai and Nhava Sheva factor in three months from the time be made with GST kicking in from alone? Is it a force of habit or of opening the Letter of Credit to the 01 July? inadequacy of facilities that results in time the material is received at our So far, a lot of our exports have this restricted choice? warehouse. While it takes two weeks been kept in abeyance because we Yes, the trade does need to change to ship our raw material from China, didn’t know in what format to raise its mindset. Despite congestion and it takes a whole week for it to come an invoice. So, up to 10 July we did port side delays at Chennai and JNPT, from Chennai to our warehouse in not export a single consignment. This the trade still prefers JNPT because it Hyderabad. is because we did not know whether is resistant to change. Our importers Q How would you want Indian the valuation is on FOB or CIF need to be sensitised on facilities ports to re-model their functioning? value. We hope these clarifications available at ports like Krishnapatnam We want cheaper, faster will be made by the customs and the and Visakhaptnam where vessel calls alternatives to JNPT and Chennai. government in the next couple of frequently, there is an Assistant Drug The ports and forwarders to bring our weeks and our documentation will Controller stationed and there is imports to our warehouse and deliver not be troublesome. Also, with this customs clearance 24/7. There is no it after having destuffed and cleared unified tax regime, we have to see reason for industries based in Andhra customs at the earliest possible date how the exporters can import raw Pradesh, Telangana and Orissa to go from the time they are off loaded. We material without paying duty. I still to JNPT for their imports. are looking at a time saving of two reckon exporters will have to pay Q What processes can be weeks to expect the least. Currently, duty, manufacture the product and quickened to benefit from time and it takes a week for all the procedures then claim a refund during the time of cost savings? to be completed once the container is exports.

46 MARITIME GATEWAY / AUGUST 2017 Q&A

“Availability of Trucks is a Challenge” Indian Metals & Ferro Alloys Ltd is one of the largest fully integrated ferro chrome producers in India. D K Mohanty, Vice President of the company details on the company’s mining, production and logistics operations D K Mohanty, Vice President Head-Ferro Alloys Business Unit, Indian Metals & Ferro Alloys Ltd

Q Please give a brief outline material degradation. about the initial journey of the IMFA PLANT LOCATIONS Q What are the logistic related company? Which are your markets? challenges before the company? IMFA was established in 1960s For our Choudwar unit, chrome with one 10MVA plant to produce ore is moved by trucks from our Ferro Silicon at Therubali and mines situated at a distance of about subsequently added 2 more furnaces at 120 kms, also with least logistic Therubali and also produced Silicon cost. However, for our Therubali Metal & silicon alloys in different unit, multi-modal transport model is times. Later, IMFA took over Kalinga adapted as the distance from mines Tubes situated at Choudwar in Odisha is more than 500km. India has less where it set up furnaces and power than 1 per cent of world’s chromite plant to produce Ferro chrome. With ore reserve and majority of the allocation of captive chromite mines deposit is found at the Sukinda Valley. in 1999, we started shifting more Considering all major chromite mines towards producing Ferro Chrome in Sukinda Valley, out bound truck as Ferro Silicon was more power requirement is very high, hence, truck intensive. Currently, we have ferro availability becomes an issue at times. alloys production capacity of 187 Q How has been the experience MVA to produce around 2,75,000 dealing with ports? tonnes of Ferro Chrome. around 1,30,000 tonnes of coke and We don’t face much difficulty at While our orientation is always coal is imported through Paradip Paradip as the company has plots towards exports, we sell 20 per cent Port. Our exports move through where cargo is stored and every month in the domestic market. We have a Visakhapatnam, while break bulk one shipment of about 7,000-8,000 joint-venture with Posco of South shipment goes through Paradip. In tonnes is moved out. But when overall Korea. There are also agreements FY-17, we exported around 2,05,000 export volume in general increases with companies in Japan, Taiwan tonnes, out of which about 80,000 from the port, there are delays and China. Low phos low ash coke tonne was in break bulk form, balance related to weighment at times but / coal are only being imported for in containers and sold about 30,000 we manage with weighment at other meeting our export requirement as the tonnes in domestic market. Movement weigh bridges. At Visakhapatnam, same are not available indigenously. to ports is by road. We do not move our containers are moved by freight Currently, to produce around material by rail as it involves multiple forwarders and at times availability of 2,30,000-2,50,000 of ferro chrome, handling which gives scope for containers remains an issue.

AUGUST 2017 / MARITIME GATEWAY 47 COMMODITIES AND CARGOES

Pulses and Pharma exports Honda leads in seed imports to to US on the rise two-wheeler decline espite pricing pressure and exports stiff competition, the Indian he government is promoting D onda Motorcycle & Scooter Pharma exports to the USA may the use of better quality seeds India Pvt. Ltd. has become T go up in 2017-18 as $50 billion H and technology to boost pulses and the largest volume contributor to worth of drugs are expected seeds production and cut down the two-wheeler exports industry to become off-patented during on imports. India imports about 5 in the April-June quarter with the current year giving hope to million tonnes of pulses and about almost one-third of the total boost export market. “We expect 14.5 million tonnes of vegetable share. Honda also leads domestic growth rate for CRAMS (Contract oils every year to meet domestic sales, contributing 69 per cent of Research and Manufacturing demand. 2016-17 was a record year overall sales in Q1 of 2017-18. Services) to be higher compared to in terms of yield and production Honda now leads domestic sales average growth rate of the industry. area also increased in the period. for the second quarter in a row. These factors are likely to support The output was 22.40 million With a 44 per cent growth in pharma exports from India,” tonnes in the crop year (July-June) exports, Honda has contributed revealed a report by Care Ratings. against 16.35 mt in the previous almost a third, to be precise 29.5 The Indian pharmaceutical year. Oilseeds output rose by 29 per per cent of the incremental export industry is likely to face cent to 32.52mt. volume in the June quarter, competition from other countries Agriculture Minister Radha or three-times more than the to get ANDA (Abbreviated New Mohan Singh exuded confidence industry volume. Drug Application) approval. Apart that India will become self- In the April-June period, from this, the Indian pharma sufficient in pulses and oilseeds Honda shipped 81,862 units, companies will continue to witness production in the coming 2-3 years. recording a growth of 44 per pricing pressure in the US generics India had a record 274 million cent over year-on-year. Overseas market due to consolidation of tonnes of food grain output in shipments by Honda Motorcycle distribution channels and increase 2016-17 and the country’s food and Scooter India contributed in competition. grain production has increased five 29.5 per cent to the total volumes. The Indian Pharmaceuticals times in the past five decades. Industry earns around 70 per cent of its revenues from sale of generic drugs and generates around 50 per cent of its revenues from exports. Of the total exports of $16.8 billion during the year 2016-17, majority of the exports, accounting for 40.6 per cent were to the American continent followed by 19.7 per cent to Europe, 19.1 per cent to Africa and 18.8 per cent within Asia.

48 MARITIME GATEWAY / AUGUST 2017 SLS HYDERABAD

Shippers and service providers of both air cargo and sea cargo came together to discuss challenges and opportunities to make logistics smart in the landlocked state

C V D Ramprasad, Director,Software Technology Parks of India, Gowra Srinivas, President, FTAPCCI, R K Raman, IRS, Additional Commisioner(P&V),Hyderabad Customs Commissionerate, C N Raghu Prasad, Additional Commisioner(Urban Biodiversity) GHMC, Madan Mohan Reddy, Chairman, PHARMEXCIL, Ramprasad, Editor in Chief and Publisher, Maritime Gateway, M Jayant Tagore, President, BDMAI.

he Hyderabad Chapter of the gathering and took them through the leads in exports and the government Smart Logistics Summit and memory lane with a quick recap of needs to promote hardware as well. TAwards was a runway hit with Maritime Gateway’s achievements Madan Mohan Reddy, Chairman, both the most known names and the in the past decade. He set the direc- PHARMEXCIL, remarked, “Logis- most promising ones walking their tion for the day-long deliberations by tics is given the least importance in talk. From the rush hours in the morn- elaborating on the focus of the event the industry, so the logistics cost are ing to well past sunset time, the Park that was to debate and understand the high, hampering the competitiveness Hyatt was abuzz with talks on how to issues at hand in logistics. As Gowra of the industry.” "SWIFT and AEO make logistics more efficient, at a low Srinivas, President, FTAPCCI, took are some of the initiatives taken by cost. The mood during the morning to the dais, he gave a clarion call to cut Customs to bring down the cost and conference was sombre yet optimistic down the logistics cost to make India time of business, but India is least in as many a speaker from the govern- more competitive on the global plat- the number of AEO users across the ment and private sector spoke of op- form. “Real growth comes from rural globe," informed RK Raman, Addi- portunities and challenges faced while areas and end-to-end supply chain tional Commissioner (P&V), Hyder- moving goods. For a hall packed with should be improved. We should move abad Customs Commissionerate. The more than 200 participants, each had a from conventional to smart logistics,” inaugural session concluded with com- take away from the sessions held. emphasised Gowra. ments by CN Raghuprasad, Addition- In the evening, the serious, Cost and time of delivery is of al Commisioner(Urban Biodiversity) business-like hall with ebony settings the essence for the pharma industry GHMC as he called for resolving transformed itself in to an atmosphere informed Jayant Tagore, President, traffic congestion at ports. of gaiety and celebration. The fresh BDMAI. Growth of the industry both “Logistics will benefit the most buds and the blossomed ones in the volume and value wise needs good from GST,” said Samir J Shah, Chair- logistics space were ready to sweep logistics management which has to be man, FFFAI, as he deciphered GST the rest away with their awards and time and cost effective. “The govern- in the keynote session. Dr Rakesh P tuxedos. About 21 awards were given ment’s focus on digital economy and Singh, Chairman, Institute of Supply away to companies and individuals for smart cities is a massive disruption Chain and Management raised the transforming the logistics landscape. and offers huge opportunity to the IT need for developing a logistics strategy In the inaugural session, Editor- industry,” revealed CVD Ramprasad, based on dynamics of trade. G Ravi in-Chief of Maritime Gateway, Director, Software Technology Parks Kumar, CGM, CONCOR briefed Ramprasad, welcomed the august of India. In the IT sector software on the expansion plans of Concor.

AUGUST 2017 / MARITIME GATEWAY 49 Logistics account for 80 per cent of the commodity cost and this can be brought down if logistics are planned in a smart way. Mahesh Bhalgat, COO, Sanofi India Ltd highlighted the logistics challenges for vaccine manufacturers such as high cost of cold chain and last mile connectivity. Integration of operations can bring down the cost for pharma. P Vinay Kumar, COO, Greenko Group, urged for bringing down the Ravinder Reddy, Director Marketing, Bharathi Cement Corporation, Dr K Satyanarayana, Director - International cost of solar power at par with thermal Logistics, Dr Reddy's Laboratories, N Krishna Kumar, VP- South India, MSC Agency (India) , Satish Lakkaraju, Chief Commercial Officer, Agility Logistics, Vinita Venkatesh, Director, Krishnapatnam Port Container Terminal, Raj Khalid, India power. In solar business time man- Representative, Port of Antwerp, Kamal Jain, MD, Cargomen Logistics agement is critical and trucks getting delayed at ports is a major bottleneck. Somesh Kumar, Principal Secretary (CT & Excise), Govt of Telangana, described the roll out of GST as “Economic Indepen- dence of India.” It will speed up vehicle move- ment and warehousing will get organ- ised. The business session one focused on sea cargo. Vinita Venkatesh, Director, KPCT detailed on the ser- D Tulasi Prasad, Regional Chairman, ACAAI, Kalyanakrishnan Nurani Hariharan, SVP-Supply Chain Management, vices offered by her company, espe- Aurobindo Pharma, Gubba Kiran, CEO, Gubba Cold Storage, G V K Naidu, MD, Sam Agritech, Laurence Jacobi, Cargo Manager - TS & AP, Emirates Sky Cargo, Hemanth DP, Chief Commercial Officer - Aero Commercial, Cargo & Asia Pacific Flying cially the ocean to door service that School, GMR Hyderabad International Airport. offers door-to-door logistics. Ravinder Reddy, Director Marketing, Bharathi SMART LOGISTICS AWARDS Cement Corporation focused on the logistics cost of the industry that stood Smart Port/ Container Terminal: Krishnapatnam Port Container Terminal at 44 per cent of the total product Smart Air Cargo Port: GMR Hyderabad International Airport cost and needs to be brought down. N Krishna Kumar, VP-South India, Smart Liner: Maerskline India Pvt Ltd and MSC Agency (India) MSC Agency India, detailed on the Smart ICD: Container Corporation of India services offered by the shipping line. This is one of the biggest liners to start Smart Pharma Company: Dr Reddy Laboratories and Aurobindo Pharma reefer for pharma. The final session of Smart Importer-Solar: Greenko Group the day had panellists discuss air cargo. “Air port is the hub where all parts of Smart Forwarder: Agility Logistics the supply chain meet,” said Hemanth Smart LCL Consolidator: Allcargo Logistics DP, Chief Commercial Officer - Aero Commercial, Cargo & Asia Pacific Smart Shipping Agent: Seaways Shipping & Logistics Flying School, GMR Hyderabad Smart Cold Storage: Gubba Cold Storage International Airport. He called for plugging all the gaps that risk tem- Smart Emerging Pharma Company: Sri Krishna Pharmaceuticals perature sensitive cargo. GVK Naidu, Smart Exporter - Food Products: Ravi Foods MD, Sam Agritech Ltd, highlighted Smart Emerging CHA: Kriji Marine Logistics the need for a dedicated perishable cargo holding facility in Hyderabad. Smart Emerging Forwarder: Admiral Hitec Logistics (India) Kalyanakrishnan N H, SVP, Sup- Smart CFS: Batco Integrated Logistics ply Chain Management, Aurobindo Pharma, discussed the challenges due Smart Exporter – Glass: AGI Glasspac to temperature deviation during transit Smart Exporter – Granite: Mahi Granites for pharma cargo. Gubba Kiran, CEO, Gubba Cold Storage, discussed the Smart Exporter - Minerals: IMERYS Ceramics nitty-gritty of operating cold storages. Smart Transporter – Rail: Container Corporation of India Laurence Jacobi, Cargo Manager, TS&AP, Emirates Sky Group, hinted Smart Transporter - Road: Nautical Lines at the need for a multimodal hub within the airport.

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