Indian Air Cargo Industry Must Grow at 12.9% To Achieve NCAP 2016 Vision: ASSOCHAM-Auctus Advisors | CORPORATE ETHOS

Indian Air Cargo Industry Must Grow at 12.9% To Achieve NCAP 2016 Vision: ASSOCHAM-Auctus Advisors

By: | October 25, 2018
Indian Air Cargo Industry

Oct 25: The Indian cargo industry needs to grow at a rate of about 12.9 per cent every year from 2018 to 2027 to achieve National Civil Aviation Policy (NCAP 2016) vision of reaching cargo volumes of 10 million tonnes (MT) by 2027, noted a recent ASSOCHAM-Auctus Advisors joint study.

“There is an urgent need to uplift Indian cargo market to achieve the overall vision of the aviation ministry,” suggested the knowledge report on Civil Aviation and Cargo, conducted by The Associated Chambers of Commerce and Industry of India (ASSOCHAM) jointly with consultancy firm Auctus Advisors.

The report noted that international and domestic air freight is projected to grow at an overall compounded annual growth rate (CAGR) of 8.2 per cent. “Considering this trend to continue till 2027, projected international and domestic air cargo will be 3.6 MT and 2.1 MT respectively resulting in total air cargo traffic of 6.8 MT.”

The study also highlighted various issues confronting aviation logistics sector in India – lack of enabling infrastructure, lack of automated material handling systems, high manual intervention in the processes and inadequate skilled manpower are some of the key areas where Indian air cargo industry lags global peers.

“There is an urgent need for creating adequate freight carrying capacity within Indian air network through creation of new cargo terminals and expansion of existing ones.”

The ASSOCHAM-Auctus study suggested implementing a rating system for cargo terminals in-line with ASQ (Airport Service Quality) ratings at passenger terminal to motivate operators to improve infrastructure and provide superior quality of services.

It also suggested undertaking pro-active measures to indentify tier-2 and tier-3 cities for setting up common user domestic cargo terminal (CUDCT).

On development of air freight station (AFS), the study said there is an urgent need for a clear cut, well-defined policy to initiate AFS ecosystem which would help in stimulating export-import trade.

Promoting concept of cargo villages and linking them with international airports is an ideal way to boost air freight traffic, improve delivery and create many job opportunities. Besides, cargo villages may also be linked to free trade zones to foster goods’ manufacturing for international markets which would give a boost to ‘Make in India,’ scheme of the government.

Considering Indian industry is suffering from high dwell time during inbound and outbound cargo custom clearance procedures, it is essential to capitalize on technological advances to promote hurdle free air cargo movement.

Further, there is a need to get away with human interface between officials and agents, as such single window system should be fully integrated with electronic data interchange (EDI) system, this also calls for urgently improving information technology (IT) infrastructure of air cargo process.

The ASSOCHAM-Auctus study also suggested introducing a separate comprehensive air cargo policy to reduce bottlenecks in freight movement.

Besides, according industry status to Indian air cargo logistics sector would go a long way in bringing down the current logistics costs and improving efficiency.