Lack Of Containers, High Rates Hurting Indian Business As Demand Picks Up

12:34am 9th October 2020

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A lack of container availability in India is hurting the export sector and posing a “serious concern” over meeting delivery commitments to foreign buyers, the Federation of Indian Export Organisations (FIEO) said Oct. 7.

The statement comes amid a acute container shortage in Asia as shipping liners remain more inclined towards deploying higher capacity on lucrative long-haul routes. The situation is further aggravated by supply chain disruptions caused by COVID-19.

“From the last couple of months, in spite of offering space for three to four weeks ahead, shipping lines are shutting out the containers abruptly, [saying] the vessels are full,” FIEO president Sharad Kumar Saraf said.

“Some of the booked containers are not being loaded as per the schedule and there is a roll-over happening when it comes to loading them on vessels,” a freight forwarder based in Rajasthan said.

If the issue of container availability is not resolved, Indian exporters will be unable to avail the benefits of a pick-up in export demand, Saraf said.

India’s merchandise exports in September stood at $27.4 billion, up from $26.0 billion a year ago, according to the commerce ministry data.

Freight rates have also gone up by 20-40% since July, depending upon destination, and the government should set up a regulatory body to protect shipping sector from such abrupt changes, Saraf said.

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