E-freight in India - Cargo Talk

Trade Associations
Domestic Air Cargo
DACAAI expresses
concern
on reducing profitability
and increasing airport charges
Speaking to Cargotalk, Amit
Bajaj, Managing Committee
member, Domestic Cargo
Agents Association of India
(DACAAI) explained that
industrial production had lowered to
3 per cent in July and the automobiles
sector was in slump. The domestic air
UNIFORMITY OF TAXES REQUIRED
movement has seen a 10 per cent drop
post June. This has put heavy pressure on
the profitability and revenues of agents
and the airlines.
On the other hand, the private
airports have been improved in terms
of the infrastructure and the handling
charges resulting in additional pressure
on shippers. Previously handling charges
were absorbed by the airlines. Now these
are being passed on to the consumer at
12 CARGOTALK OCTOBER 2011
According to the AAI statistics, in the first 3 months
of the current financial year domestic cargo traffic
has shown a slowdown (4 per cent) as compared to
the same period in 2010-11. Freight forwarders are
in tremendous pressure due to the decline in
profits and increasing costs. Ratan Kr Paul
very high rates. This has resulted in the
reduction in tonnage for cargo being sent
by air for short haul sectors.
In addition, in most of the cases the
cargo acceptance godowns of the airlines
are outside the airport (towards the city),
resulting in early cut-off for outbound
According to DACAAI, the service tax charged on movement of cargo on
airport to airport basis should be the same, as in case of road transportation.
This will reduce cost thus increase tonnage.
TDS is another area of displeasure. The TDS deduction on the agents’
earnings happens in two folds. At the time of the receiving the payments,
which is two per cent of the gross collections and on commissions that
agents get from airlines (10 per sent of the amount received). This creates
heavy shortage of working capital. “For air cargo agents community the
government should remove the condition of TDS deduction on commissions,”
appealed Bajaj.
cargo due to unnecessary transportation
of cargo from the point of acceptance to
the airport. Furthermore, incoming cargo
is delivered at the parking lots as airlines
have not been allocated adequate space at
airport, making cargo prone to pilferage
and shortage.
In Bajaj’s opinion, for smooth, time and
cost effective operations airlines should be
allocated space inside the airport and the
sanitized area should have an entry to the
tarmac. This would help in delayed cut-off
for outbound consignments and faster and
secure delivery of inbound consignments.
“The airlines should be allocated
spaces to handle cargo themselves and an
option for common user terminal should
be given. This will reduce the exorbitant
Amit Bajaj
charges, being charged by the terminal
operators who have monopoly at
some stations. Bajaj emphasised on the
long standing demand of cargo villages
near the metro airports, like the Delhi
Airport. “There has to be a legally
dedicated area where godowns and
offices of cargo agents can be located,” he
said. At present the office and godowns
are scattered around the airport on
unauthorised locations causing security
risk and traffic congestions.
WWW.CARGOTALK.IN