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Family Aid 2020
   Vol. 21 No. 20
Tuesday May 17, 2022

India Superdog Takes A Bite Out Of Cargo

Jyotiraditya Scindia

  India's air cargo received a thumping boost when the Harvard and Stanford Graduate School of Business-educated Jyotiraditya Scindia, the country's minister for Civil Aviation charted out a target: achieve 10 million metric tons of cargo by 2030 from the 3.1 mn metric tons at present.
  At a select gathering of top air cargo stakeholders (the Air Cargo Forum India, an association of various stakeholders of Air Cargo Logistic Supply Chain Trade and Industry), Scindia pointed out that air cargo - once an “underdog” had become a “superdog” during the “tumultuous and painful” Covid times. That was because the industry had been able to adapt and change to the new environment. This new environment, he emphasized, had been created due to the “paradigm shift in the role of the government”. Earlier, the government was a “regulator, controller and a creator of barriers”. Today, it is a facilitator and often a hand-holder that allows air cargo stakeholders to perform to the maximum of their capabilities.
  Referring to himself as a “backroom boy” who does not believe in sitting at a square table but a round one – “I do not believe in heading a table but want to work as an equal partner” -- the Minister said that the air cargo industry was “ripe for explosion”. Witness the figures: air cargo had been seeing a growth rate of 9-10% since 2013-14. And, in the last two years, airlines have seen a 520% increase in cargo revenue. As of today, the Indian cargo revenue stands at INR 2,000 crore (US$307.12 million) with 3.1 million metric tonnage at a CAGR of 13%. Air cargo’s growth could be seen from the number of Indian freighters: from seven to 28 in a short period of three years.
  The major share of air cargo came from the four metro airports -- Delhi, Mumbai, Hyderabad and Bengaluru -- and the time had come to focus and connect Tier-2 and -3 cities to the metros. Scindia said there was need to “strategize” and “grow the market”. He would concentrate on his three-point agenda: Create feeder services to connect Tier-2 and -3 cities to metros; Develop India as a transshipment hub; and, bring in ease of business by making the processes completely paperless.
  He pointed out that “to achieve the target of 10 million metric ton in cargo, industry players need to focus on transportation of smaller cargo loads from Tier-2 and Tier-3 cities to metros with the acquisition of smaller aircrafts”. For that the government was creating 33 new domestic cargo terminals by 2024-2025.
  Over the next four years, the Ministry of Civil Aviation will be spending close to INR 98,000 crores (US$1,26,85,668.80) to set up new Greenfield airports and expand existing Brownfield airports. Part of this amount, INR 62,000 crores (US$80,26,563.40) will be invested by private sector. The government, through Airports Authority of India, will expand 42 Brownfield airports and set up 3 new Greenfield airports. The private sector will expand 7 existing Brownfield airports and set up 3 new Greenfield airports including Navi Mumbai, Jewar and Mopa.
   He elaborated on how this has opened opportunities in the country. Infrastructure creation has already started paying off: Jackfruits from the small Northeastern state of Tripura (the eight state in the Northeast has remained neglected basically for want of connectivity) have found a market in UK and Germany while King Chillies and Lemons from Assam, again a Northeastern state, were now being supplied to London. This, said Scindia was, a classic example of A2A i.e. Agriculture to Aviation, a link of “two seemingly unrelated sectors being linked due to air infrastructure being made available to remote areas in the country.”
  Scindia’s words were well received by the air cargo community. Now that cargo has become a “superdog”, our desire of seeing the country as a top air cargo player does not seem far away, as a veteran freight forwarder put it. A clearer picture of the government’s designs have indeed emerged. We will keep you posted.
Tirthankar Ghosh

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