CIIL Weekly Logistics Newsletter CII Institute of Logistics â 2nd July ...

CIIL Weekly Logistics Newsletter 

_ 

INSTITUTE OF LOGISTICS 

Logistics Newsletter 

July 2 nd 2008 

HIGHLIGHTS THIS WEEK 

ARTICLE 

Radio Frequency Identification (RFID) 

IS INDIA READY FOR THE BIG LEAP 

NEWS ROUND UP 

ROADWAYS 

• Service tax relief for truck owners 

RAILWAYS 

• Agartala gets rail connectivity 

• KRC, Rail Vikas Nigam eye Dighi, Indapur project 

• Railways up freight rates to offset diesel price hike 

AIRWAYS/AIRPORTS 

• Airfares likely to go up as ATF prices go up 

• Datacraft in talks with 2 airports for IT infrastructure 

SEAPORT/SHIPPING 

• ABG Shipyard bags Rs 5.85 billion order 

• Mainline box vessels calling New Mangalore Port 

• Government okays cruise shipping policy 

• Chennai Port’s turnover soars by 115.3 pc in 5 years 

• CMA CGM to operate higher capacity vessels to India 

CII Institute of Logistics – 2 nd July 2008 1

CIIL Weekly Logistics Newsletter 

WAREHOUSING/DISTRIBUTION 

• Ramco wins Logistics order from Continental Carriers 

INTERNATIONAL NEWS 

• India placed 71st in trade index 

• TNT Express launches time-sensitive heavy shipments 

• Four airlines fined for cargo price-fixing 

• HK may award CT10 contract to lines 

• Trans-Balkan oil pipeline cost rises to 1.5 bln euros 

• FEFC carriers see 11.4% westbound growth in May 

• Tianjin Port handles 26million tonne of iron ore in 5 

months 

• Rising China demand for diesel fuels spot freight rates 

• Swift Global Logistics signs MOA with Topocean Group- 

Singapore 

INDICATIVE FREIGHT RATES 

• Indicative Ocean Freights to various Sea Ports 

• Indicative Trucking Rates in India 

• Air Freight Rates (domestic & international) 


CIIL Weekly Logistics & Freight Newsletter 

ARTICLE 

Radio Frequency Identity (Rfid) 

IS INDIA READY FOR THE BIG LEAP 

Radio Frequency Identification Technology, known widely by its ubiquitous 

abbreviation RFID, with its cutting edge business applications and benefits 

has inspired an endless array of possibilities and applications. The 

technology indeed, existed for decades before but it was on June 10, 2003 

that Linda Dillman, the Chief Information Officer (CIO) of Wal-Mart set the 

ball rolling with an announcement that their top 100 suppliers would be 

henceforth required to utilize Radio Frequency Identification (RFID) tags 

on their cases and pallets by January 2005. 

This announcement truly set the RFID technology into motion as various 

stakeholders in the Wal-Mart supply chain world-wide, including other 

major retailers and logistics and supply chain partners started evaluating 

various strategies and practices to cope with the possibilities and meeting 

challenges of this new technological mandate. The RFID technology 

needed a big push and Wal-Mart initiative gave it a necessary momentum 

and brought it to centre-stage of market. 

The hype and hoopla of RFID promise still stares the potential user 

industry in its face. The hope, disappointment and promise that this 

technology has evoked has now turned one full circle. IT research firm 

Gartner in its recent report - Market Share and Forecast: Radio Frequency 

Identification, Worldwide, 2004-2010 – has estimated that world-wide 

RFID market will grow from $504 million this year to $3 billion in 2010.It 

was earlier reckoned to touch this level by end-2008. The RFID industry, 

says Gartner report is starting to come out of the trough of disillusionment, 

referring to a phase in its famed "Hype Cycle" model that tracks the 

adoption of emerging technologies. It means that after the RFID hype 

over-heated earlier, the industry had slumped as optimism turned to 

skepticism about the technology and its benefits. Now the tide, it says is 

starting to turn in its favour. On a cautionary note the report notes that 

there is still need for demonstration of meaningful results about values 

gained from its existing deployments. 

The promise of this technology notwithstanding, it has from its very 

inception thrown up an avalanche of questions – what is this RFID 

technology really all about; how is it going to be implemented across 

industries and markets; how would it really suit the requirement of 

different stakeholders in a business value chain; what tangible and 

intangible benefits would accrue from adopting this technology and more 

importantly, who would bear the cost of implementing/adopting this 

technology. 



Arguably, there is no ready “fit-one-fit-all” kind of convincing answers to 

any of the basic questions. Yet, as the number of RFID users world-wide, 

including in India, keep multiplying, wide range of RFID-related 

implementation practices are coming into broader view and this should 

certainly help in finding the answers to some of the questions indicated. 

What is RFID 

Radio Frequency Identification (RFID) is an e-tagging technology that 

provides businesses an opportunity to add electronic identities to any 

product, inventory or asset. These RFID tags store data, which can be 

remotely accessed. This allows integration with the information technology 

system and easy operations. Companies, which seek highest standards in 

supply chain management, logistics and transportation security, have 

started using the technology to ensure maximum RoI (Return on 

Investment). 

Successful adoption of this technology, however, largely depends on its 

integration with the existing business applications and enterprise 

solutions. Among likely user industries, large retail outlets, manufacturing 

industries, warehouses, travel/car fleet units and airports are some 

significant adopters of this technology for managing security, access 

control, logistics as well as real time information access and updates. The 

RFID technology is also finding its place in access control systems of 

vehicle parking lots and toll roads, expressways and bridges. It can also 

find its use in high density and high value client-specific transactions of 

banks, judiciary and government to track important document files. 

In the logistics industry, the RFID can deliver many advantages, including 

traceability of assets within the supply chain, optimum order management 

and improved product availability. In the future, the RFID logistic solutions 

would use the RFID technology throughout the complete supply chain to 

achieve seamless integration of operations. Logistic RFID systems can be 

used for numerous applications in production, inventory warehousing 

logistics and distribution. - RFID tagged containers, boxes and carriers, 

work piece carriers and tools in assembly lines, airports and automobile 

production, and for access control to company property and parking 

facilities. 

Products can also be tracked whilst in the possession of consumers and 

habits and trends identified. A benefit of RFID in logistics is that it can also 

reduce costs and wastage within the supply chain. Costs are lowered as 

the increased visibility of products through the supply chain helps reduce 

shrinkage and errors. Savings can be achieved from the removal of 



manual processes due to automated scanning of assets, rather than the 

manual scanning of bar codes. 

How does it work 

The main component of RFID technology is the transponder/tag1, which in 

most cases comprises of a chip and antenna mounted onto a substrate or 

an enclosure. The chip consists of a processor, memory and radio 

transmitter. These transponders communicate via radio frequency to a 

reader, which has its own antennas. The readers can interface through 

wired or wireless medium to a main computer. Transponders are also 

known as smart or radio tags. The memory will vary, depending on the 

manufacturer, from just a few characters to kilobytes. 

Transponders can either be Read Only (R/O) which are pre-programmed 

with a unique identification or they can be Read Write (R/W) for 

applications that require data to be stored in the transponder and can be 

updated dynamically. Another form of transponder is Write Once Read 

Many times (WORM). This will allow for an identification number to be 

written to the transponder once. The information is stored in the memory, 

it cannot be changed but the transponder can be read many times. 

The two most common types of RFID technologies are Active and 

Passive. Active RFID transponders are self-powered and tend to be more 

expensive than Passive one. Having power on board allows the active tag 

to have greater communication distance and usually larger memory 

capacity. 

As for Passive RFID transponders, which are available with chips and 

without chips, they have no internal power source therefore, require 

external power to operate. The transponder is powered by an 

electromagnetic signal that is transmitted from a reader. The signal 

received will charge an internal capacitor on the transponder, which in turn 

will then supply the power required to communicate with the reader. 

RFID logistic Electronic tags contain memory and readers extract the data 

stored on the tag. If you attach the tag to a product, and store on it an 

Electronic Product Code (EPC), which is a unique product identifier For 

example, a can of soup would have a tag on it that contained information 

such as who manufactured it and its unique number and transport and 

disposal history. A RFID tag on a container of multiple products such as a 

pallet, the asset can then be tracked giving visibility and reduced 

shrinkage / loss. 



BENEFITS OF RFID IN LOGISTICS & SCM 

Benefit 

Increased 

Accuracy 

Faster 

Throughput 

Lower 

Inventory 

Description 

Sensors can automatically detected missing or misdirected 

shipments and raise an alert. Because scanning 

requires no human intervention, it can be done more 

often, thus increasing the granularity of supply chain 

visibility. 

Thanks to RFID’s ability to scan multiple tags 

simultaneously—up to 400 per second with most 

advanced UHF systems—the case-level contents of 

entire pallets can be scanned at key locations like 

warehouse dock doors, all without human intervention. 

Increased accuracy and visibility allows manufacturers, 

distributors, and retailers to maintain lower inventory 

levels, thus freeing capital. An RFID-enabled supplychain 

essentially allows for lower inertia, making the 

whole system more responsive. 

RFID Users in India 

RFID usage in India is still limited to few users and industries, though by 

no means this is to be construed as any indication either its relevance or 

potential benefits. The promise of RFID technology are indeed, many and 

are similarly placed as computers, which were seen ,only some two 



decades back, as though it were some distant dream. By all reckoning, the 

adoption of RFID technology may indeed, prove to be far quicker than 

could ever be anticipated in the past. 

A significant entry barrier that is holding back this technology from 

becoming widespread in India is the relatively high unit cost of RFID chips 

but with the cost of manufacturing these chips going down exponentially, it 

is now becoming more acceptable. 

Reliance Retail, one of India's largest retailers, has been testing RFID 

technology and is preparing applications for use at a large number of its 

hypermarkets and supermarkets, as well as its electronics and 

convenience stores. The company has already equipped these stores with 

data ports and wireless computer networks able to support RFID systems. 

Reliance Retail has drawn up plans for using RFID to support its 

operations. The company has developed five RFID-deployment scenarios, 

including the tracking of reusable crates of fresh food; item- and case-level 

tracking of high-value goods; and pallet and case tagging of various 

goods. 

Reliance has performed proof-of-concept tests using passive EPC Gen 2 

UHF RFID tags to track crates of fresh foods and cases of high-value 

goods. The company managed to achieve above 90 percent read rates 

and found that RFID helped it reduce shipping and receiving errors while 

increasing productivity. For the test to track individual items and cases of 

high-value goods, Reliance Retail has recently conducted a pilot between 

one distribution center and one Reliance Digital store. This pilot is still 

under evaluation. Reliance is now working with various RFID hardware 

and tag suppliers to obtain improved read rates for the tracking of freshfood 

crates, as well as planning a permanent rollout of other scenarios 

upon successful completion of the pilots. 

Case Study 

SCORE deploys RFID in Textile Industry 

First major deployment of Contactless Smart Cards and RF ID for quality 

assurance and production flow automation in the textile industry has been 

successfully completed by Score Information Technologies Limited at 

AMFL, Kolkata. 

Through this integrated solution various problems of Textile Industry, in 

particular Quality Assurance, Work Flow Automation, stocks, Machine 

maintenance, have been successfully addressed. Problems of false 

reporting, employee favours have been adequately addressed while 

substantial improvement in efficiency and improved production quality 



have motivated the customer to invest further and deploy the solution for 

other production sites as well. Total of 1,700 looms employing about 9,000 

people have now started using RFID solution for their work flow 

automation. Integration with EFFECT, an ERP solution from Score, has 

made it a complete solution. The environment was Oracle 8i, Visual Basic 

on Windows XP. 

Infenion's RF ID chips popularly known as 'my-d' were used for the 

purpose. The RFID inlays have Intelligent 10 kbit EEPROM with 

contactless interface complying to ISO/IEC 15693 and security logic. my-d 

supports the "Chip Sharing Approach" (CSA). Secure memory sectors on 

my-d ICs enable different stakeholders in a (secure) supply chain to 

handle data. Defined access rules enable the authorized users to work 

with the relevant data. Score has adopted a smart way to exploit the 

economic potential of RFID technology. 

Rajasthan State Road Transport Corporation (RSTC) is another user of 

RFID with its passenger buses moving between Delhi and Jaipur fitted 

with RFID transponders, enabling their movement to be tracked. RFID is 

can be used together with VSAT to track road vehicles. A registered user 

can log on to the system through the Internet and can view the current 

status of the vehicle. Many companies in developed countries take 

advantage of this tracking technology in their fleet operations. An 

estimated daily 2.5-3 million trucks move cross the country, logging about 

300 km a day, against 800 km in developed countries. A 10 per cent 

increase data in real time. This data is transmitted to the Internet, and then 

to the company's computers, for viewing the productivity of trucks would 

yield an annual saving of some Rs 20,000 crore. Truck transporters use 

mobile phones that have GPS tracking. Identification via RFID tags also 

helps reduce warehousing costs and error rates in the supply chain. 

The Centre for Railway Information Systems (CRIS) of Indian Railways 

similarly too uses Radio Frequency Identification (RFID) technology to 

improve the wagon management system of the Railways. CRIS proposes 

to have a RFID tag or chip embedded in all the wagons and provides 

sheds with handheld devices that would read these chips and thus register 

the data. Following this, the details can be fed into the Indian Railways 

system to help track wagons accurately. A pilot project will be run in the 

East Coast Railways. 



WEEKLY NEWS ROUND UP 

ROADWAYS 

Service tax relief for truck owners 

Supply of transport vehicles to goods transport agency (GTA) for transport 

of goods by road will not attract service tax, the Finance Ministry has 

stated. Budget 2008-09 had said that services provided in relation to 

supply of tangible goods for use, without transfer of possession and 

effective control would attract service tax from May 16. The field 

formations in the revenue department had taken a stance that goods 

carriage (transport vehicles) would be covered under this provision and 

hence service tax would be applicable on supply of goods carriage to 

GTA. Based on the representation of the All India Confederation of Goods 

Vehicles Owners Association (ACGVOA) and also from the All India Motor 

Transport Congress, the Finance Ministry has exempted fully the levy of 

service tax on supply of goods carriage to GTA for use in transportation of 

goods by road. 

AIRLINES/AIRPORTS 

Airfares likely to go up as ATF prices go up 

Airfares are likely to go up further with the state owned oil firms deciding to 

increase aviation turbine fuel (ATF) prices by another Rs2,500-3,000 per 

kilolitre with effect from July 1. Any increase in ATF prices is set to be 

passed on to consumers as airlines have refused to absorb any further 

losses. Oil price has gone up from $121 per barrel, when ATF prices were 

last revised on June 5 to an all-time high of $142 per barrel now, reflecting 

a 15% increase in less than a month. Consequently, oil companies are left 

with no option but to increase the ATF prices. It would be in the range of 

Rs 2,500 per kilo litre to Rs 3,000 per kilo litre. The price hike will be 

announced on Monday and be effective from Tuesday, said the executive 

director of a leading oil PSU. The airlines will evaluate the impact of ATF 

price hike after it is announced on Monday. ATF prices account for over 

45% of the operational cost of airlines. ATF is sold in a range of Rs 66,226 

to Rs 73,473 per kilo litres in different cities, over 80% higher than the 

prices globally. According to Capa estimates, India’s airlines are likely to 

lose a combined $1.5 billion this fiscal, more than double a year earlier, 

because of the surge in jet fuel prices. 

Datacraft in talks with 2 airports for IT infrastructure 

Datacraft Asia, a $580-million Singapore-based provider of IT 

infrastructure and related solutions, is in talks with the New Delhi and 

Bangalore airport authorities to set up IP telephony-based infrastructure. 



The company recently completed work as a consultant with one of the 

airports and helped design its security and overall design layout. Datacraft 

has put in place IP telephony-based IT infrastructure for the Hong Kong 

and Bangkok airports with the basic infrastructure cost alone amounting to 

about $10 million (about Rs 40 crore).. With the entry of private players in 

the airports space, the Government is striving for the best infrastructure. 

Internet Protocol (IP) telephony enables voice communication over the 

Internet. Here, voice and data exist on one network and can be centrally 

maintained. Instead of separate, multi-line phones, beside a PC at each 

desk, IP telephony allows software on the PC to serve as a soft phone. 

Unlike telephone hardware, this can be easily upgraded and enhanced, 

without work disruption, extra equipment cost or even visiting each desk 

for manual installation. All end points in a particular place can be made IPenabled 

and connected on to one system. For an airport, these include 

security cameras and their network, flight details and announcements, 

baggage check-in, free WiFi ports and telephone services for passengers 

and ground service functions of airlines. The company plans to add about 

250 employees this year to its existing 800 in India and 5-6 local business 

partners. Current partners in India include Cicso and Microsoft. It expects 

to total revenues to cross $650 million thereby registering a compounded 

annual growth rate of over 20 per cent. 

RAILWAYS 

Agartala gets rail connectivity 

It's a dream come true for the people of Tripura, with the entry of the first 

railway engine of the Northeast Frontier Railways to Agartala station 

during a trial run for the 67 km long Agartala-Ambash rail line on 29 th 

June. By the end of September this year, after the clearance of railway 

security board, passenger and goods trains are expected to run. People 

have high hopes with the train as they believe that rail line along with it will 

bring industries with it and thus the available resources of the state shall 

be utilized. It will not only give revenue to the state but also create new 

avenues of employment in this landlocked state. Moreover, with better 

connectivity people can now move to other parts of the state with very 

minimal fare and prices of daily commodity shall also go down. In 

construction of the line that took 15 years to build more that one hundred 

workers had lost their lives mainly due to insurgency and many more in 

malaria. Earlier, Prime Minister Dr. Manmohan Singh had declared the 

railway link in Tripura as a national project and more connections are 

planned. Presently, Indian Railways operate at least 11,000 trains every 

day covering 63,465km (39,435 miles) across the length and breadth of 

the country, making it one of the world's largest rail networks. 



Stone India develops pantograph for double stack container trains 

Stone India Ltd’s in-house R&D setup has designed and developed a 

pantograph (a power collecting trolley) to be used in locomotives deployed 

for experimental run of double stack container trains being planned for the 

proposed dedicated freight corridor, according to company sources. The 

experimental run is to take place shortly in certain sections under the East 

Coast Railway. The new series of pantograph, called Omniversal 

Intelipanto TM, has been tested and cleared by the Research Design & 

Standards Organization (RDSO) of the Indian Railways, say the sources, 

adding that the experts from Japan, the funding country for the proposed 

freight corridor, too, have approved the equipment. The major constraint in 

running high speed locomotives with double stack container trains is the 

increase in what is called centenary height from six metres to 7.5 metres. 

To balance such a high reach pantograph in double stack containers 

moving at a high speed in adverse wind condition has been a big 

challenge for all global suppliers. Kolkata-based Stone India Ltd, which 

has been catering to the requirement of the Indian Railways for more than 

76 years and has introduced many critical systems for the Railways in 

partnerships with foreign companies, hopes to export the new series of 

indigenously-developed pantographs to countries planning to use electric 

traction for running double stack container trains. 

KRC, Rail Vikas Nigam eye Dighi, Indapur project 

Several investors are reportedly queuing up to pick up equity in the Rs 

550-crore Dighi-Indapur railway project. The list includes Konkan Railway 

Corporation (KRCL), Rail Vikas Nigam (RVNL), IL&FS and IDFC. The first 

two have expressed interest in acquiring 26% stake each while the 

financial investors are interested in a smaller share of the pie. However, all 

investors may end up getting something less than what they want as the 

promoter, Balaji Infra Projects (BIPL), intends to keep the majority stake 

with itself. The construction work of the project is expected to start on 

receipt of the Railway board’s approval. The RVNL board last month 

accepted the financial study, and in turn, recommended it to the ministry of 

railways for sanction of the project. The special purpose vehicle (SPV) for 

the project will be formed on receipt of the ministry’s approval. An early 

estimate reveals that the proposed project will cater to all types of bulk, 

break bulk and container cargo as well as liquid and gas cargo. The initial 

cargo-handling capacity is expected to be around 6.95 million tonne per 

annum, which will go up to 13.90 mtpa in two years. BIPL also plans to 

invest around Rs 2,000 crore in the next four years for developing Dighi 

port. The development will include building up to 10 berths in the port and 

a dedicated car terminal, added sources. The 432-km-long Dighi-Indapur 

project needs a lot of tunneling in the Western Ghettos. KRCL will acquire 

land for the project. 



Railways up freight rates to offset diesel price hike 

The Indian Railways as part of their dynamic pricing policy have decided 

to levy supplementary charges on freight rates. The move is expected to 

increase the freight rates for commodities like iron ore and mineral, petrol, 

oil and liquid products, fertilisers, foodgrain, among others, in the range of 

5-7 per cent. The change is effective from July 1 to September-end. The 

decision has come at a time when the economy is reeling under doubledigit 

inflation, which touched 11.42 per cent for the week ended June 14. 

Interestingly, this is the seventh time the railways have either re-classified 

the commodities or levied additional charges since the railway minister 

announced in his Railway Budget that there will be no across-the-board 

increase in freight rates for 2008-09. However, a ministry official said the 

railways often re-classifies commodities and levies supplementary 

charges The decision to impose supplementary charges will help the 

railways partially offset the burden of the diesel price hike," he said. The 

railways' annual fuel expenditure averages Rs 8,000 crore and the recent 

hike in diesel prices has put an additional burden of Rs 560 crore on it. 

Commodity experts say that the move may result in the price of these 

commodities rise in the range of 5-14 per cent, with foodgrain and 

fertilisers being hit the most. 

SHIPPING/SEAPORTS 

ABG Shipyard bags Rs 5.85 billion order 

ABG Shipyard, India’s largest private sector ship builder has stated that it 

has bagged Rs 585 crore order from Singapore-based Toisa Ltd for the 

construction of three sub-sea multi-purpose vessels. The company has 

received an order for construction of three sub-sea multi purpose vessels 

from Sealion Shipping Ltd on behalf of Toisa Ltd having a total order size 

of about Rs 585 crore, ABG Shipyard informed Bombay Stock Exchange 

in a filing. With this order, the total order book of the company now stands 

at around $2.436 billion (about Rs 10,427 crore). Toisa currently operates 

a modern fleet of 23 vessels. Besides, Toisa has a further 12 offshore 

support vessels under construction which will enter its fleet in the near 

future. Sealion Shipping and Toisa are engaged in specialized E&P 

support vessels, consultancy and technical support to the marine industry. 

Mainline box vessels calling New Mangalore Port 

The third mainline container vessel during the current calendar year called 

at New Mangalore Port, boosting the growth of container traffic at the port. 

On 25 June, m.v. Sea Navigator, which called at the port with 584 TEUs 

(twenty-foot equivalent units) of raw cashew, sailed out on 27 June with 

export cargo to West Asia and East African countries. CMA CGM’s 

mainline container vessel m.v. Sea Navigator called at New Mangalore 

Port to discharge mainly raw cashews loaded from Colombo for 

Mangalore discharge. It also loaded coffee, cashew kernels, plywood and 



roof tile shipments in containers directly on this vessel for West Asian 

ports. During the current financial year, the port handled 7,225 TEUs of 

container cargo against 3,953 TEUs of containers in the corresponding 

period of the previous year, recording a growth of 82.77 per cent. Export 

cargoes were accepted for Jebel Ali and Khor Faffan in the UAE, 

Mombassa in Kenya, Dar-es-Salaam in Tanzania, Nacala in Mozambique 

and Mahajanga in Madagascar directly from the New Mangalore Port. It 

may be mentioned here that the first mainline container vessel m.v. Kota 

Handal of PIL (Pacific International Line) of Singapore called at the port in 

January. This was followed by the second mainline container vessel CMA 

CGM Okapi in May. 

Government okays cruise shipping policy 

To encourage cruise shipping, the Union Cabinet has given its approval 

for adoption of Cruise Shipping Policy of India that envisages hassle free 

customs clearance, dedicated cruise shipping terminal, among others. 

Cruise Shipping is fast emerging as a new marketable product, growing at 

the rate of 12 per cent a year globally, this sector has witness some 

activity in India as well in recent times. However, it is still in its infancy in 

India, said an official release. This industry annually generates $14 billion 

worldwide and enjoys a passenger base of over 10 million, which is 

expected to almost double by 2009. India’s share is only two per cent. As 

regards number of cruise ships, projections/forecasts are that the number 

will increase from the present 257 to 285 by 2009, said the release. India 

with its vast and beautiful coastline, virgin forests and undisturbed idyllic 

island, rich historical and cultural heritage, can be fabulous tourist 

destination for cruise tourists. 

Chennai port’s turnover soars by 115.3 pc in 5 years 

The Chennai Port has more than doubled its turnover from Rs 413.51 

crore in 2003-04 to Rs 890.40 crore in 2007-08, a record 115.3 per cent of 

increase. This was revealed at a review meeting of performance and 

development projects of Chennai Port Trust (ChPT). The increased 

turnover has enabled ChPT to take up a larger number of capacity 

augmentation projects, including the progress of the proposed mega 

terminal at Chennai, which will have a draught of 22 metres. The Rs 

3,105-crore terminal will be able to handle ultra-large containerships of 

even the Malaccamax 18,000-TEU ship. The project has generated 

considerable interest among the prospective bidders and nearly 40 private 

players have participated in the pre-bid meeting, 

CMA CGM to operate higher capacity vessels to India 

CMA CGM, the world’s number three and France’ number one container 

line, proposes to increase the capacity of its EPIC (Europe Pakistan India 

Consortium) service from 2009 when the 4,200-teu vessels currently 

operating on the route will be replaced by higher capacity 6,500-teu 



vessels. Marc Bourdon, Managing Director of CMA CGM Global (India) 

Pvt Ltd, has said India was one of the key countries, along with China, 

Vietnam and Brazil, receiving a good deal of attention in the French lines 

policy matters. The shipping lines business growth in India had been 

impressive at around 30 to 40 per cent. In 2007, CMA CGM throughput in 

Indian ports was 5,80,000 teus, likely to rise to 8,00,000 teus in the current 

year, he said. CMA CGM, offered as many as 12 direct services to and 

from India including one feeder service from Kolkata/Haldia to Port 

Kelang. This is the largest number of direct services offered by any line 

out of India, he said and pointed out there were plans to invest heavily in 

infrastructure. In 2007, total container throughput in India ports was 7.5 

million teus, likely to rise to nine million teus in the current year. 

WAREHOUSING/DISTRIBUTION 

Ramco wins logistics order from Continental Carriers 

Ramco Systems, has announced a breakthrough order-win from 

Continental Carriers Pvt Ltd (CCPL), one of the India's shipping & 

transportation logistics service providers for Integrated Freight 

Management System (IFMS) and the fully integrated financial 

management accounting package. Ramco will offer its Integrated Freight 

Management System (IFMS) that caters to the requirements of NVOCCs 

(Non Vessel Operating Common Carriers) Freight Forwarders, 

Consolidators & Groupage providers, for both sea and air cargo. The 

solution will help CCPL more efficiently manage the nuances of freight 

forwarding business, such as planning and consolidation, cargo clearance, 

EDI, transportation, documentation, collaboration & finance. With the 

existing conventional and inherited legacy systems, CCPL is looking for 

updation and modernization of its operational and customer support 

systems with a view to augment its capabilities in view of growing 

customer expectations, and requires an integrated, scalable solution that 

would comprehensively support our development plans and enable it 

service the customer needs more efficiently. 

INTERNATIONAL NEWS, 

India placed 71st in trade index 

World Economic Forum’s Global Enabling Trade Report 2008 released 

recently has placed India in 71st position in the global enabling trade 

index, largely due to the tariff barriers adopted by the country. The country 

continues to adopt restrictive market access with tariff barriers 

“representing a more serious impediment than non-tariff barriers”, the 

reports has observed. With regard to market access, the country has been 

placed at 105th position among 118 countries surveyed in the report. 

Hong Kong and Singapore have been ranked at the top as these 

economies are considered most open to international trade and 



investment as part of their economic development strategy. The index 

covers four areas, namely, market access, border administration, transport 

and communications infrastructure and the business environment. 

Sweden and Norway followed, and to complete the top 10, came Canada, 

Denmark, Finland, Germany, Switzerland and New Zealand. The US has 

been ranked 14th, helped by a top-notch transport system, but brought 

down by cumbersome Customs procedures and the UK has been placed 

two notches below the US, largely because of its high costs. China comes 

48th because imports are subject to severe tariff and non-tariff barriers 

despite the country’s accession to WTO. 

TNT Express launches time-sensitive heavy shipments 

TNT Express is launching a range of freight services for time-sensitive 

heavy shipments in Southeast Asia. The three new services-Express 

Freight, Economy Freight and Freight Plus-will offer customers a door-todoor, 

day-definite delivery service based on specified transit time 

schedules, fast- tracked Customs clearance and full track-and-trace 

visibility. The move forms part of the company's US$100 million 

investment over the next five years to build a leadership position in the 

region, a strategy that it announced in April. This launch is also the first in 

a series of initiatives to further expand TNT's network capabilities in Asia, 

leveraging on the seamless connectivity offered by its extensive road and 

air networks. These networks provide customers with the widest range of 

multimodal freight services between Southeast Asia and Europe, China 

and Europe and within Southeast Asia. Based on studies undertaken of 

regional market needs, TNT expects the take-up rate of these services to 

be high. The large demand is mainly driven by customers in the high-tech, 

equipment and machinery and health-care sectors that are increasingly 

moving large volumes of high-value goods between Southeast Asia, China 

and Europe. Through its global customer base in these sectors, TNT has 

developed extensive sector knowledge that can now be leveraged in 

Southeast Asia. Correspondingly, TNT's integrated road and air services 

are set to be a main business driver for the company over the next five 

years 

Four airlines fined for cargo price-fixing 

Four airlines, including Air France-KLM and Hong Kong-based Cathay 

Pacific, are to pay fines in the US totalling $504 million for their roles in a 

criminal conspiracy to fix surcharges on air cargo shipments. Investigators 

from around the world, including the US, the European Union and 

Australia, have uncovered a global conspiracy in the air freight industry in 

one of the world's biggest cartel probes. About 30 airlines are under 

investigation and criminal prosecutions of individuals are also under way. 

To date, including yesterday's moves, the US Department of Justice has 

imposed fines of more than $1.2 billion as a result of its probe into the 

aviation industry, the highest fines yet imposed in a criminal antitrust 



investigation. The US justice department said yesterday that four groups 

had agreed to plead guilty: Air France-KLM, the world's largest airline 

measured by turnover; Cathay Pacific, the de facto Hong Kong flag 

carrier; SAS Scandinavian Airlines; and Martinair, a 50/50 joint venture 

owned by KLM and Maersk, the Danish shipping concern. 

HK may award CT10 contract to lines 

Hong Kong favours shipping companies over port operators when 

awarding the rights for a planned container terminal to help secure traffic 

as competition from cheaper mainland harbours mounts. This idea allows 

us to tie up with shipping lines, which will bring in more containers, 

Permanent Secretary for Transport and Housing Francis Ho Suen-wai 

said. The government might seek traffic guarantees for Container 

Terminal 10 rather than just auctioning off the concession to the highest 

bidder. China Shipping Container Lines might consider bidding for the 

project, said spokesman Ye Yumang. 

Trans-Balkan oil pipeline cost rises to 1.5 bln euros 

The cost of the trans-Balkan oil pipeline being built by Russia, Bulgaria, 

and Greece has increased to 1.5 billion euros ($2.3 billion) from 1 billion 

euros ($1.55 billion), according to RIA Novosti. Russia, Bulgaria, and 

Greece signed a memorandum on the Burgas-Alexandroupolis oil pipeline 

in April 2005. Once completed, the pipeline will pump 35 million metric 

tons of oil a year (257.25 million bbl), a volume that could eventually be 

increased to 50 million metric tons (367.5 million bbl). Nikolai Seryogin, a 

member of the supervisory board of the Trans-Balkan Oil Pipeline project 

company, said the price increase was due to growth in the prices of metal 

and pipe products, adding that a final costing would be made after an 

adjusted feasibility study for the project has been conducted. Construction 

of the pipeline, expected to take from eight to twelve months, would begin 

in 2009. Under an inter-governmental agreement signed in 2007, Russia 

holds 51% in the project company, while Greece and Bulgaria hold 24.5% 

each. 

FEFC carriers see 11.4% westbound growth in May 

Member lines in the Far Eastern Freight Conference (FEFC) in May 

achieved 11.4 per cent year on year container growth in the westbound 

Asia to Europe/Mediterranean trade. The FEFC said its members' 

westbound box volume for May was 865,339 TEUs, up from 777,146 

TEUs in the same month last year. Broken down by region, the monthly 

Far East-to-North Europe volume was up 11.6 percent to 535,126 TEUs, 

while the westbound trade to Mediterranean ports improved 11 percent to 

330,213 TEUs. After five months of 2008, the FEFC members' westbound 

volume was up 10.4 percent to 4.05 million TEUs. Eastbound figures for 

May are not available yet, but the FEFC did report April's backhaul volume 



as being up 4.3 percent at 322,480 TEUs. After four months the 

eastbound volumes were down 1.8 percent at 1.89 million TEUs. 

Tianjin Port handles 26million tonne of iron ore in 5 months 

It is reported that Tianjin port completed iron ore throughput of 25.99 

million tonnes in the first five months of 2008 up by 20% YoY. The port 

authority has taken many measures to address the recent excessive 

stocks due to a forecast on higher international iron ore prices, intensive 

imports and speculative holdings by domestic players and a lack of 

transportation capacity across the country since early this year. As per 

report, these measures included well arranged shipment schedule, using 

rails to disperse excessive ore, raising warehouse charges, further 

expanding warehouses capacity and building new docks at Nanjiang. As a 

result, iron ore stocks at Tianjin port stood at normally 6.21 million tonnes 

as of June 15th 2008 

Rising China demand for diesel fuels spot freight rates 

Spot freight rates in the tanker segment are set to go up in the next few 

months as a result of rising diesel imports from China. The country has 

been stocking up on diesel following the recent earthquake, even as stateowned 

oil companies are importing the fuel in large quantity ahead of the 

forthcoming Olympics. Despite recent fuel price hikes in several Asian 

countries, there is a surging demand for fuel, triggering a rush for imports 

and leading to a spurt in shipping freights. Indian shipping companies 

such as GE Shipping and Shipping Corporation of India have a majority of 

their fleet capacity in the tanker segment and this increased demand is 

expected to help them get better returns. International media reports 

highlight that China is importing 175,000 barrels a day of diesel in June 

this year, a jump of 33 per cent from the level imported in the previous 

month. The demand is mainly to meet the gas supply in major cities, which 

had been disrupted during the recent earthquake. Moreover, a strong 

demand from Western refiners to transport crude oil from West Asia 

ahead of the peak summer driving season in North America is also driving 

up the demand for tankers. As a result, spot freight rates for VLCCs (very 

large crude carriers that are used to transport oil from West Asia to North 

America and East Asia) are currently ruling at $114,313 a day compared 

with the average spot freight rate of $57,393 a day in the March 2008 

quarter. In the other tanker segments like the Suezmax, the current spot 

freight rate is $62,390 a day compared with the average spot freight rate 

of $36,034 a day in the March 2008 quarter. 

Swift Global Logistics signs MOA with Topocean Group-Singapore 

Topocean Group, one of the top forwarders/ logistics service providers in 

Singapore, recently signed a Memorandum of Agreement (MOA) with 

Swift Global Logistics to become an authorized Sales Agent of SAM (Sea 

Air Model) - Swift's multimodal combined transport service. The MoA was 



signed by both parties, led by Behram Baluch for Swift, Far East Regional 

Director; and Thomas Sim for Topocean Group-Singapore, CEO. Sim, a 

well-known personality and one of the industry movers in Singapore, 

believes that SAM is the wave of the future. 'With inflation rates hitting alltime 

high, businesses are required to look for an efficient multimodal 

combined transport that offers a cost-effective way to move cargo - and 

SAM answers this concern. We look forward to a mutually beneficial 

collaboration with Swift Global Logistics,' related Sim. Swift Global 

Logistics is a subsidiary of Swift Freight International, a Dubai-based 

freight logistics solutions provider that initiated SAM. SAM moves goods 

from the Far East into various destinations into Africa via transshipment in 

Dubai. What makes SAM unique is its multimodal combined transport 

capability with fixed departure and 6-month advance schedules, enabling 

industry players to plan their business cycles better. 'Now that Topocean 

Group-Singapore is part of the roster that is authorized to sell SAM, we 

are confident that a wider coverage of significant clientele is ensured. We 

are hoping that this would be the catalyst to encourage more to become 

an authorized SAM Sales Agent,' said Baluch. 



FREIGHT RATES 

(Prices listed below are Indicative Ocean freight rates for a Container 

and negotiable with respective Shipping/Liner Agents). 

Indicative Ocean Freights to various Sea Ports 

REGION/COUNTRY 

OCEAN 

I. Europe 

PORTS 

FREIGHT 

COST 

(US$) 

U.K. Felixstowe 1500 

Southampton 1800 

Netherlands Rotterdam/Antwerp 1500 

Germany Hamburg 1500 

Italy Genoa 1500 

France Lettavre 1500 

II North America 

Marseilles 1500 

NORMAL 

TRANSIT 

PERIOD 

27-28 

Days 

27-28 

Days 

27-28 

Days 

27-28 

Days 

27-28 

Days 

27-28 

Days 

27-28 

Days 

OCEANS 

SHIPPING 

LINE 

MSC, APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 



USA New York 2500 

New Jersey 2500 

Charleston 2500 

Houston 2500 

Miami 2500 

New Orleans 2500 

Mobile 2200 

Boston 2200 

Baltimore 2200 

Canada Toronto 2500 

40-45 

days 

40-45 

days 

40-45 

days 

40-45 

days 

40-45 

days 

40-45 

days 

40-45 

days 

40-45 

days 

40-45 

days 

33-35 

days 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 

APL, 

Transworld, 

Maersk, 

ContShip 



III. Latin America 

Montreal 2200 

33-35 

days 

Panama Panama 2800 40 Days 

APL, 

Transworld, 

Maersk, 

ContShip 

E. Maersk 

OOL / APL 

Paraguay Parangua 2750 35 Days Samrat 

Chile Valpariso 2750 35 days Samrat 

Argentina Buenos Aires 2200 35 days Samrat 

Santos 2200 35 days Samrat 

Brazil Riogrande 2200 35 days Samrat 

Uruguay Montevideo 2200 35 days Samrat 

Colombia Catagina 2700 35 days Samrat 

IV .Middle East 

UAE Dubai 600 

Oman Muscat 850 

12-14 

days 

12-14 

days 

UASC 

UASC 

Israel Haifa 1300 30 days UASC 

V. Mediterranean Ports 

Turkey Istanbul 1400 30 days 

Italy Genova 1500 

VI. Far East 

Naples 1500 

Valencia 1500 

18-22 

days 

18-22 

days 

18-22 

days 

Lloyd 

Triestino/CMA 

Lloyd 

Triestino 

/Greenways 

Samrat/ 

Greenways 

Samrat/ 

Greenways 

China Hong Kong 550 30 days Hyundai 

Shanghai 850 22 days Hyundai 

Japan Tokyo 1150 22 days Mitsui 



Philippines Manila 900 22 days Mitsui 

Singapore Singapore 400 22 days DBC 

Spain Barcelona 1050 

VII. Australia 

Adelaide 2000 

Sydney 2000 

Brisbane 2000 

18-22 

days 

25-28 

days 

25-28 

days 

25-28 

days 

Samrat 

OCL 

/Wockhard 

OCL 

/Wockhard 

OCL 

/Wockhard 



Indicative Truck Freight Rates Between Metros and Major Cities 

Note (Rupees per ton for nine tones), 

Kolkata Chennai New,Delhi Mumbai 

Kolkata XX 2,888 2,222 3,666 

Chennai 2,806 XX 3,444 2,444 

New Delhi 2,611 3,333 XX 2,666 

Mumbai 2,972 2,000 1,944 XX 

Ahmedabad 2,861 2,350 1,056 1,444 

Bangalore 2,889 777 3,278 1,777 

Bhopal 2,556 2,050 1,056 1,444 

Bhubaneshwar 1,020 2,050 2,667 2,777 

Chandigarh 2,410 3,850 500 3,000 

Coimbatore 3,611 950 4,000 2,333 

Cuttack 1,000 2,050 2,722 2,777 

Guwahati 2,778 5,425 3,889 6,000 

Hyderabad 2,167 1,050 2,444 1,388 

Jaipur 2,444 3,150 611 1,888 

Jalandhar 2,360 3,875 833 3,111 

Jamshedpur 700 3,000 2,000 3,555 

Kanpur 1,975 3,310 833 2,667 

Kochi 3,330 1,410 4,444 2,555 

Lucknow 2,000 3,115 911 2,777 

Madurai 2,955 850 4,000 2,444 

Nagpur 1,694 1,600 1,556 1,222 

Patna 1,556 3,600 1,889 3,666 

Pune 2,889 1,725 2,000 555 

Siliguri 1,389 3,850 2,667 4,666 

Visakhapatnam 1,583 1,445 3,333 2,167 

Vijayawada 1,806 515 3,111 1,777 

Source www.infobanc.com 



Air Freight Rates: Domestic 

Domestic (Non-documents all rates in Rupees) 

10 Kgs 

TO/FROM Chennai, Delhi Mumbai Kolkata Hyderabad Bangalore 

Chennai - 812 519 732 226 226 

Delhi, 826 - 586 626 639 799 

Mumbai 506 533 - 706 373 413 

Kolkata, 706 546 719 - 732 839 

Hyderabad 320 639 373 919 - 453 

Bangalore 226 812 439 852 453 - 

50,kgs 

Location Chennai Delhi Mumbai Kolkata Hyderabad, Bangalore 

Chennai - 3,076 1,904 3,662 1,132 1,132 

Delhi 3,149 - 2,197 2,050 2,197 3,149 

Mumbai 1,861 1,831 - 3,528 1,465 1,538 

Kolkata 2,710 2,048 2,490 - 2,780 2,929 

Hyderabad 1,331 2,197 1,465 2,996 - 1,797 

Bangalore 732 2,710 1,465 4,261 1,797 - 

100,Kgs 

Location Chennai Delhi Mumbai Kolkata, Hyderabad Bangalore 

Chennai, - 6,005 3,515 7,323 2,263 2,263 

Delhi 5,932 - 3,954 3,808 3,954 5,932 

Mumbai, 3,502 3,542 - 5,459 2,929 2,929 

Kolkata 5,139 3,821 4,647 - 3,954 5,566 

Hyderabad 1,598 3,954 2,929 4,926 - 3,595 

Bangalore 1,465 4,833 2,783 8,521 3,595 - 

500 Kgs 

Location Chennai Delhi Mumbai Kolkata Hyderabad Bangalore 

Chennai - 24,898 15,378 36,615 11,317 11,317 

Delhi 19,772 - 15,012 15,978 16,843 23,434 

Mumbai 12,449 15,179 - 27,295 13,182 10,985 

Kolkata 22,036 16,377 19,905 - 19,772 24,166 

Hyderabad 6,657 16,843 13,182 24,632 - 15,978 



Bangalore 7,323 21,237 10,985 42,607 15,978 - 

1000, kgs 

Location Chennai Delhi Mumbai Kolkata Hyderabad Bangalore 

Chennai - 49,797 30,757 73,231 22,635 22,635 

Delhi 38,080 - 26,363 31,955 33,686 38,080 

Mumbai 24,898 30,357 - 54,590 23,434 21,969 

Kolkata 39,545 28,094 39,811 - 39,545 43,938 

Hyderabad 13,315 33,686 23,434 49,264 - 31,955 

Bangalore 14,646 39,545 21,969 85,214 31,955 - 

Source: Bluedart 

Disclaimer: All information contained in this report has been obtained 

from sources believed to be accurate by DVV Media India Pvt Ltd. While 

reasonable care has been taken in its preparation DVV Media and CIIL 

make no representation, warranty, express or implied as to the accuracy, 

timeliness or completeness of any such information. All information should 

be considered solely as statements of opinion and neither DVV Media nor 

CIIL will be liable for any loss incurred by users from use of the contents of 

this report.

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