Ever since the outbreak of the pandemic, the global shipping industry has been under a fix, struggling to meet the demand with a severe shortage of shipping containers in hand. Furthermore, the recent blockage of the Suez Canal has further put the industry under a microscope.
Chairman & MD of Container Corporation of India (CONCOR), V Kalyana Rama reflected on the Indian shipping industry’s woes during a recent interview with Bloomberg.
He said, “Due to the shortage of shipping containers, the volume growth in Indian export which would have been much more, is getting affected.
“Although there is a lot of empty repositioning that is happening at the Indian shores, still the demand is more which is affecting the exporters in India and the freight rates,” he added.
The shortage of shipping containers is posing as a big bump in the industry’s recovery journey and is also maintaining an upsurge in freight rates. One of the major reasons for the same is the Indian shipping Industry’s dependency on China for the manufacturing of the containers. However, now the industry is taking steps to on reducing this dependency.
“We have given orders to two of the public sector units for developing container manufacturing in India for 1000 containers each. Also, we are developing 6 more vendors/container manufacturers, giving them an order of making 1000 containers each,” informed Mr Kalyana Rama.
“This is our requirement for the domestic movement of goods. Once we began this, the container manufacturing will pick up in India and we will able to make India the hub of container manufacturing,” he added.
The Suez Fiasco
The CONCOR MD also reflected on the impact of the Suez Canal blockage which caused major disruption to the global shipping industry with delayed shipments and increasing freight cost.
Mr Kalyana Rama however feels that the situation in India seems to be in control.
He said, “There is a drop in imports at Indian ports but we did not see much of an impact for a week. Yes, there was a little shortage of imports. So, some trains were running empty backward. Otherwise, things are under control here in India.”
While the Ever Given was refloated last week, its residue remains, amid warnings of soaring freight costs that could affect supplies of key goods or consumer prices. Although the industry is grinding to make a quicker and better recovery, another lockdown caused due to the rising second wave of COVID awaits the shipping industry, adding to the stress.
However, Kalyana Rama feels that the industry is ready for the second wave. He said, “The industry is exempted from the lockdown. And, with the experience that we went through in the last year, we are ready for another lockdown. We know how to go by it.”