India is on lockdown until 3rd May 2020, with Peter Deubet, Head of the Hamburg Representative Office Mumbai, and his colleague Lea Miram, Hamburg Business Manager in Mumbai, reporting that logistics costs for the transport of goods are expected to rise.
In India all international and domestic flights are still on hold and many airlines need financial support from the Indian government in order to continue their operations after the pandemic.
Logistics costs for the transport of goods are expected to rise. Some transport providers have already increased their prices by more than 80%. The reason given for the surcharges for the transport of goods is a huge drop in offered capacity because of regulatory challenges and a drastic labour shortage.
The movement of ships in Indian ports is also being greatly restricted due to the closure and quarantine measures taken by the government to combat the coronavirus pandemic. Namely, there are ships waiting for days in Mumbai, Gujarat and the west coast as ports are experiencing labour shortages and serious logistical problems.
When the ships get the slot on the berth, loading and unloading become a challenge, as there is less than 20% of the workforce in the ports and there are hardly any trucks to transport the goods to the hinterland.
In addition, the shipping lines are already cancelling their calls. The containers are stuck in important ports partly because of global trade restrictions and the increase in “blank sailings” by shipping lines often leads to a shortage of empty containers.
India now wants to ensure efficient, preferably contactless customs clearance and to reduce transaction costs. For this reason, it has already been decided to allow fully electronic clearance by transmitting a PDF-based eOoC copy (electronic Out of Charge) for BoE and eGate Pass. Certificates of origin can now also be generated online.
The Indian Ministry of Shipping could use the COVID-19 pandemic as a reason for declaring force majeure. Adani Ports and Special Economic Zone (APSEZ), India’s largest private port company, has already announced force majeure at its facilities in Mundra, Tuna and Dhamra. In the meantime, the Ministry of Shipping has instructed all major ports to suspend penalties for delays caused by the lockdown.
The world’s largest lockdown so far has cost the Indian economy around 7-8 billion rupees ($ 98 billion) during the 21-day period.
