Air freight corridor between India and Afghan brings in cheer for trade

It was jubilant faces that we could see on 19 June in Delhi airport when the first air freight from Kabul landed. More than the success of the first flight touching down, it may be looked as India’s first victory over Pakistan’s muscles stretching to block India’s trade by road with Afghanistan. Pakistan was in an advantageous position as all by surface routes from India to Afghanistan passes through Pakistan.

The much talked about India-Afghanistan air freight corridor took shape during the meeting between Prime Minister Narendra Modi and Afghan President Ashraf Ghani in September 2016. And the detailed plans were worked out when both the country heads met at Amritsar for the regional summit. The following six months were crucial for both the countries to make it a reality. It is understood that necessary over-flight permissions were taken as it flies over Pakistan sky.

It was earlier reported that the first flight from Kabul would take off on June 15. But the first flight took off from Kabul on June 19 marking an imprint in the history of air freight between the two countries. With the air cargo corridor in operations, it is now estimated that the trade between India and Afghanistan would touch the $1 billion in the next three years from the current levels of $800 million.

While President Ashraf Ghani inaugurated the air corridor from Kabul, India’s Foreign Minister Sushma Swaraj and her deputy MJ Akbar was at the Delhi Airport along with Ashok Gajapathi Raju, India’s Minister for Civil Aviation, to receive the maiden flight. 60 tonnes of asafoetida or commonly known as hing worth $6 million dollars was the first set of cargo. The Indian Prime Minister welcomed the first flight by tweeting, “Direct connectivity between India and Afghanistan will usher prosperity. I thank President Ashraf Ghani for the initiative.”

t is now believed that the trade between the two countries is set to improve tremendously and also give Afghanistan a greater access to Indian markets. Currently, Afghanistan uses the Karachi Port for its exports. And export via road service to India is through Pakistan. Though the movement of cargo from Afghanistan to India via road is allowed, however, import from India on the same route is prohibited by Pakistan.

Recalling here the much talked about TAPI gas line (Turkmenistan-Afghanistan-Pakistan-India). For energy-starved countries like India and Pakistan, TAPI would be the best solution. The pipeline which was conceived in early 90’s had hit many roadblocks in the past. After much delay, it is now believed that the line would be a reality in 2020. Some section of the industry is still sceptical about the line coming online, owing to the resistance from Pakistan, rising security threat because of ISIS penetration in the region, etc. However, the project geared momentum when Prime Minister Narendra Modi visited Turkmenistan in 2015 July.

So if everything goes as planned, India will have a boost in a trade to Afghanistan in the near future and attain energy security once TAPI becomes alive.

Shipbuilding industry to get a boost

Shipbuilding industry to get a boost with ship design & model testing center coming up, says Shipping Minister

The shipbuilding industry in the country will get a great boost with a ship design and model testing centre coming up, as a memorandum of understanding (MoU) has been signed with IIT-Kharagpur. The facility will be the first-of-its-kind in the country, said Union Minister of State for Shipping (Independent charge),  Mr Mansukh Mandaviya, while speaking as a Chief Guest at the inaugural of the two-day conclave of ports of the Bay of Bengal Initiative for Multi-sectoral Technical and Economic Cooperation (BIMSTEC) last week, said a report.

The proposed centre would be of great use to the other six member nations in BIMSTEC—Bangladesh, Nepal, Bhutan, Myanmar, Sri Lanka and Nepal. The Minister said there was great potential for improving maritime cooperation, and trade and commerce among the seven nations. All of them were registering 6-7 per cent growth in spite of the global slowdown and there was a great deal of synergy in their interests, he added, as per the report.

Government invests in integrated air cargo industry IT platform

The Ministry of Civil Aviation of government of India is preparing to launch a common information technology platform to streamline country’s air cargo industry. The common IT platform, according to India’s civil aviation secretary Rajeev Nayan Choubey, is “not an idea but a work in progress”.

“It is unfortunate that the air cargo industry is far behind the shipping industry when it comes to IT adoption and innovation. We intend to complete the common IT platform for the air cargo industry within next two years, and we are talking to every stakeholder to ensure that the common platform is the most efficient tool to enhance the air cargo value chain,” said Choubey recently.

The common IT platform, according to Choubey, will be a project under the Ministry of Civil Aviation. Today, each stakeholder in the air cargo supply chain works in silos and operates legacy systems resulting in cumbersome processes and undue delays in cargo movements. The new IT platform will bring efficiency in handling air freight.

“The platform that we are creating will ensure cargo is tracked and traced and shippers will be able to identify the most cost-effective routes to move their cargo in real time,” said Choubey. Talking about how the industry participants are responding to this initiative, the civil aviation secretary stated that everyone is waiting for something like this and “this is something that should have happened yesterday”.

Globally the air cargo industry may have reached a crucial point where a fast-track approach to digitalisation is required to keep pace with competitive modes of transport. Outdated and complicated processes and the continued use of legacy systems by air cargo industry stakeholders pose serious challenges to future of the industry.

It is undergoing a technology transformation – expanding from heavy use of legacy mainframe systems to more customised interfaces used for networking planning, flight operations, revenue accounting, and other processes.

The industry has, to varying degrees, been slow in adopting the best practices and technological innovations that will modernise air cargo. Despite the benefits, many airlines and airports are yet to tackle the upgrade of their legacy systems.

According to the ministry, India’s air cargo industry is expected to grow 9 percent in the next few years. The new national civil aviation policy targets to increase cargo capacity to 10 million tonnes and it expects to increase air freight volume four times by 2027.

The ministry of civil aviation is also identifying niche products that demand air as a mode of transport. Choubey said that when the country’s air cargo infrastructure is enhanced and streamlined, the potential is huge for time sensitive cargo. He identified perishables, including pharma, and express cargo as two segments that will offer huge volumes to air cargo. “Pharma is a big money spinner, and we intend to capture a big share of the pharma market,” he said.