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Handling charges: Terminal operators at JNPT not on the same page

A plan to set uniform shifting/handling charges across all container terminals at Jawaharlal Nehru Port Trust (JNPT) to draw more importers to a so-called direct port delivery (DPD) programme, which was rolled out last year to speed up imports through India’s busiest container port, has failed to take off.

With private firms running three of the four terminals resisting the move, the rate regulator was forced to notify the rate only for the facility run by the port trust.

Approved rates
The Tariff Authority for Major Ports (TAMP) has approved a rate of ₹1,688 for a 20-feet container (TEU) and ₹2,532 for a 40-feet container (FEU) for the JNPT-run terminal on an application filed by the port authority seeking identical rates for all terminals for the shifting of DPD containers at the yard .

The rates, notified by TAMP, are subject to delivery within three hours of “gate in” of the truck for taking delivery (of the container).

However, Dubai’s DP Worldcollects ₹2,212 for TEU and ₹3,318 for FEU for handling DPD containers at its facilities in NSICT and NSIGT.

GTIPL, the facility run by Danish giant APM Terminals, charges ₹1,800 for a TEU and ₹2,700 for a FEU.

“The representatives of the [private] terminals have said that a uniform rate may not be possible to implement,” said a government official overseeing customs processes at JNPT. “There should be parity in pricing, otherwise, it is going to impact the DPD, as the saving of the importers will further be reduced,” he said.

Currently, 1,157 clients have been given DPD status, accounting for some 57 per cent of the total imports handled at JNPT. The number of containers cleared under DPD is only about 33 per cent of the overall containers handled. The share of NSICT and NSIGT is only 20-25 per cent of the containers cleared under DPD. They charge a higher rate, which is impacting the DPD, the Customs official said.

DPD essentially means import containers are delivered directly to pre-approved clients at the port itself instead of waiting in a CFS located outside for clearance, which reduces cargo dwell times and cost for shippers.

The Shipping Ministry, at the behest of NITI Aayog, instructed JNPT to set uniform rates for all the four terminals for making the DPD scheme attractive to consignees, in a bid to raise the DPD levels to 40 per cent from the 3 per cent in 2016.

As DPD involved multiple shifting (average of 2-4) of containers (stacked one on top of the other in the yard to facilitate delivery to importers from a mixed stack), this entailed extra costs. Individual private terminals exercised their discretion to levy different shifting charges from importers.

Previously, there was no rate as DPD charges in the TAMP tariff guidelines. “The private terminals are linking and charging rates on single shifting /double shifting basis. This has led to a situation wherein the benefits under DPD is denied and there is no certainty of cost to the trade. To have a uniform rate for all DPD clients, JNPT had approached TAMP to notify a new tariff for DPD,” says JNPT.

In its application filed before TAMP, JNPT said that a uniform rate for handling DPD containers “will help the importer by way of lesser cost”. Besides, being a “pre-determined rate”, it would enable the importer to plan his cost in advance.
Source: The Hindu Business Line

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