Air cargo industry seeks domestic capacity

Development of domestic air cargo capacity should be given top priority, as shippers are heavily dependent on foreign carriers for movement of cargo. This should be one of the main focus areas to be incorporated in the Civil Aviation Policy, say sources in the air cargo industry. The Ministry of Civil Aviation had last month released a draft policy to get comments from the trade on various issues. During the late 1990s, when there was a demand and supply mismatch, foreign carriers providing freight capacity out of India demanded premium airfreight rates (express rates below 100 kg rate) to accept and move the cargoes. The Centre, under the Open Skies Policy and de-regulated tariffs, was helpless to intervene and help the exporters. Nor was Air India equipped to charter cargo aircraft and provide capacity. Similarly, when supply exceeded demand, Lufthansa was the first to offer ‚??zero‚?? freight from Delhi, to ensure it successfully raided the market share of Air India, and from a long-term perspective, inhibit any attempt by an Indian operator to consider dedicated freighter operations, he said. Unless a nation creates a sustainable and robust home grown international logistics player, the threat of economic security remains constant. With a national player, our exports can move to a CIF (Cost, Insurance and Freight) terms from the current FoB (Free on Board) term, which indirectly supports the foreign interest. China has a formidable shipping capacity and a airline network. Cargolux is tied-up with Chinese carriers to ensure regular feed, he said. However, some in the industry feel such a system is only a dream. Any effort to start such a domestic air cargo capacity will be with an intention to sell off to a multinational company later, and hence may not work out. Courtesy: The Hindu Business Line

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