Problems for development of Logistics Industries in India

Indian economy is one of the fastest growing economy of the world. Now in these days there are a type of revolution in every sector of economy and Industries. Here is also we see the growth and revolution in Transport, Railway, Shipping, Aviation, Warehousing, Supply Chain and Logistics Industries.  logistics Industries is also a fastest growing sector in India. every month we see the launch of new Logistics Company. It is really good for logistics sector and create a competitive market for logistics service provider. It is also good for their consumer to choose the best and suitable service provider for their need.

But there is a big drawback for this sector in India. As we know that lots of youth of India are trained in Logistics Management and Diploma. They know properly how to manage and work in the logistics, many of them are highly skilled but many logistics companies are like to employ unskilled people on very less salary. If you will visited any cargo movers clearing and forwarding office at any place in India you will see that most of them are unskilled and working in very very less salary. If any skilled people will ask for job their the company will also offer very less salary without any staff welfare services. many company will not provide EPF, ESI and any related services to their staff. They are working in very unhygienic condition without any working culture.

Same condition with Logistics, Transport, warehousing and courier service provider company. They only need unskilled and uneducated staff for very less salary. For Management position they have their own family and friends, lots of them are not as skilled as general skilled youth.

It is the proof of profiteering of most of the owner of these logistics service provider company. Actually these profiteering is the biggest problem for the growth of Logistics Industries in India.

But today many multinational companies are entering in India and providing working culture with skilled youth. These companies are really a big support for our skilled youth providing them a good job with good salary and working environment.

Some of Indian Logistics companies are also become multinationals today and also providing good job for skilled youth with very good salary and working environment.

As per my experiences I can Say that DTDC LOGISTICS is one of the best logistics service provider company. From their launching period of Logistics Service,  DTDC has started recruiting skilled people with a good salary and nice working culture which is continue till now. I am really a big big fan of working culture of DTDC Logistics.

Many other Indian Logistics Service provider companies are recruiting skilled people with good salary to improve their results. They are also trying to improve the working culture.

If this improvement will continue then sure Logistics Industries in India will catch a high growth rate with the support of India Logistics Service Provider Companies.

This is based on my personal experiences. I train and educate many logistics professionals and students. I also provide them support and network to start their own logistics service with support of already running network To be the part of that network these skilled people are earning more then any job in logistics company.

CLICK HERE to know more about my Logistics Training and Educational Program. 

Liability Insurance compared with Cargo Insurance

The traditional marine cargo insurance market was stable in the sense that it can provide to the cargo owner or the shipper the exact type and scope of cover they require according to the nature of their goods, the kind of voyage, the nature of risks and the shipper’s individual claim records. This stability can never be stated in the liability insurance market. In such a situation the question arises as to how can the MTO provide the cargo owner with a full property insurance guarantee while he secures his own interest under liability insurance. This can certainly be provided by regulations as under.:

  1. By making a direct link between a fault or omission of the insured and payment of a claim to a third party.
  2. By providing an upper limit of the liability amount. This feature however would affect the risk bearing cost because without ascertaining the corresponding liability amount, the computation of premium payable would be difficult.

Inspite of such possible measures it has been argued often that a system relying mainly on direct recovery from underwriters is a more effective use of settling the claims than one relying on liability because of the extra time and expense involved particularly with legal procedures.

For instance the member countries of G20, European Union, BRICS, ASIAN, BIMSTEC, SHARK and many other economic and business group of nations are trying to establish and some of them are also established the mutual club by pooling resources of all insurer in the region so that dependence on European and USA market for re-insurance too is minimized. The initiative was taken by ASIAN in the month of October 1991 to establish regional co-operation in insurance so as to recognize ASIAN RE incorporated in Singapore as a regional insurance company in each of the member ASIAN country and treat each cessions given to ASIAN RE as local cessions. Similar kind of initiative can be taken by member countries of other regional trade and economic groups. The advantage would be increase the competitiveness of the export in the international market by cutting down the foreign exchange element of cost of insurance.

Importance of Trade volumes for Planning a Dry Port

Dry ports depends essentially on the external trade traffic of the countries in which they are setup.While planning a dry port, therefore the first consideration would be the trade volumes, both inwards and outwards means imports and exports both. once these are decided, detailed break down of import and export volumes in every terms would be most useful parameters to outline the necessary facilities that need to be provide in terms of terminal handling, storage and transport. the next step is that panning team have to determine the commodity and its volume that may move from the dry port. during the course of survey it was found that most governments of land-locked countries bring out annual statistics of external trade in terms of commodities and values. The common problem encounter is the paucity of current data regarding the every aspects of commodities trade which could help establish the requirements of transport, handling and storage at the dry port.

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It was learnt that basic document used for these statistics is the custom declaration failed at the border or at the check point and this contained the information on the weight of consignment. There is no other practical difficulties in compiling the weight of commodities imported and exported.

As in all developing countries, the pattern of trade in the land-locked countries consists predominantly of exports of primary commodities and semi manufactured goods and import of finished products.

The important fact to consider will be the separate requirements of commodities and their volumes both for imports and exports that have to be catered for at the dry port. The facilities and their size would have to be determined accordingly.

India’s Growing Conflict between Trade and Transport

Now in today’s world India is a biggest partner of trade. Every company and business tycoon wants to do business in India. Many manufacturers also wants to manufacturing their products in India. Everything depends upon trade policies and practices. India will not be first choice for business and trade for them if it dose not speed up the adaptation of the changing environment in international trade and distribution logistics.

India has to create joint public- private sector task force to establish an agenda for market survey and system analysis to identify system short coming and needs.

Develop and manage efficient subsystems for shipping, railways, road and air transport sectors as well as port and warehouse system.

Lift import duties on vital equipment and spares.

Revise the regulatory and control net that was strangles transport. Above all, simplify customs procedures.

Adapt trade related banking and insurance arrangements.

Promote the national freight forwarding industry by relaxing regulations that govern it.

Encourage the participation of the private sector, particularly through equipment leasing and privatization of such facility operations as container terminal.

Now in these days India has did a lot of work to develop international trade and distribution logistics but some work has to do also. India is trying to accelerate the changing system and I can say that “Yes India is successfully doing every changing and soon become a favorite nation for every businessman and industries”.

Logistics Problems of Indian Industries

Now today India is the biggest market for every types of manufacturing industries. Every manufacturer dreaming to capture market of India. So today India is developed like a marketing hub center. But government of India and manufacturers in India are trying to develop India as a manufacturing hub. In single word we can say that India is developing itself as a trade and manufacturing hub. Logistics and Supply Chain plays a big role to make India’s economical developments.

The government of India is well aware of the volatilities in today’s trade markets and of the colossal restructuring that continuous to take place within in international trade and transport circle. while there is rightful satisfaction over the fact that India’s export to overseas markets have been booming during more recent years, there is at the same time growing concern over India’s ability to effectively adjust to the changing international market environment so that any deterioration in export performance could be timely contained. Effective logistics arrangements by the Indian industry and service sector will play a tremendous role in such endeavor. If India is able to streamline the organizational setup for managing the Logistics of import and export, then the cost of commodities in the competitive international market will be substantially reduced. It is good news for us that India is implementing it.

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This is all the more serious as many of the India’s competitor in world market make swift moves to improve their Trade Logistics Arrangements. It will be studied by checking differences of freight cost and how China’s freight costs are low it is important.

To overcome this issue and makes freight costs low it is important to develop infrastructure, skilled human resources, makes contractual agreement  with other famous logistics providers of worldwide and improve performance indicators etc.

This article is very important and open for discussion. If anyone has any thoughts and ideas please share here in this blog. Your ideas and thoughts will help our students and followers.

Logarithms of Complex Number

If e to the power z is equal to ω,

where z and ω are complex quantities, z is called the logarithm of ω.

If e to the power 2nΠi is equal to 1,

therefore e to the power (z+2nΠi) is equal to

(e to the power of z) multiplied with (e to the power 2nΠi)

= ω×1 ( putting the value of both)

where n= positive and negative 1,2,3,……….

Therefore by definition, z+2nΠi will also be the logarithm of ω.

So the logarithm of ω is a many valued function.

The value of logω=z+2nΠi, when n=0 is called principle value.

The general value of ω is demoted by Logω and the principal value by logω.

If e to the power z=ω, then

Logω=z+2nΠi  and  logω=z

∴ Logω=logω+2nΠi.

But always remember if e to the power x is equal to r,

where x and r are real, then

Logr=x+2nΠi

=logr+2nΠi.

Thus the logarithm of a real quantity consists of single valued real part but many valued imaginary part.

Distinction between Carrier and MTO in MTGA to support Exporters’

In the Act of MTGA, carrier has been defined as a person who is engaged in the business of “transporting” or hiring goods by road, air, rail, inland waterways or sea. While the MTO, on the other hand, has been defined as any person who:-

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a) Concludes a multi-modal transport contract on his own behalf or through any person acting on his behalf.

b) Acts as a principal and not as an agent either of the consignor or of the carrier participating in the multi-modal transportation and who assumes responsibility for the performance of the said contract .

c) Who is registered under subsection 3 of section 4 of the Act.

Thus there are three implied conditions for any agency to work as multi-modal transport operator. Unless these three conditions are specified, no person is authorized to act as MTO. This ensures prevention of mushroom growth of freight forwarders as multi-modal transport operator. The condition laid down for registration as per sub-section 3 of section 4 of the ACT as under:-

  1. The person or company desiring to act should be a shipping company or a company engaged in the business of freight forwarders in worldwide or in certain nation with a respected amount of turnover for last three years, which is revised time to time by each nation as per their priorities and international acceptability.
  2. If the company is not involved in any business of freight forwarding or shipping transport, then the turnover amount should be twice or thrice multiple of fixed respected turn over amount.
  3. The applicant should have offices or agents or representatives in not less then two other countries. obviously the conditions are meant to protect the interest of exporters in the sense that the person assuming the responsibility of MTO should be financially sound with proper infrastructures, in position to act as MTO and look after the interest of exporter from the point of view of documentation, the procedures of custom clearance and the legal aspects in international trade.

Protection of Exporters’ Interest Through Multi-modal Transportation of Goods Act

Multi-modal Transport Convention of U.N. was drafted as a result of development of maritime legislation and subsidiary regulation of almost 50 years. Hence it has been considered representing massive improvement in the field of international trade, protection of the interest of the developing countries as well as development of new transport. For its ratification the requirement of number of countries was fairly high, and so it could not find favour with the developed countries and could not become international convention.

There are several provisions to protect the interest of exporters through this act.

  1. Distinction between the carrier and MTO in the act.
  2. Provisions for cancellation of registration as per section 5 of this act.
  3. Freedom to exporters to make the multi-modal transport document either negotiable or non-negotiable.
  4. Overcoming the restrictions of “Hague Visby Rule” by inclusion of animals, containers, pallets or smaller articles of transport in the definition of goods.
  5. MTD as document of title.
  6. Presumption about receipt of goods in good condition and quantity.
  7. Basis of liabilities of MTO is on presumed fault or neglect.
  8. Liability of MTO not only for delay but also for any consequential loss or damage arising from such delay.
  9. Presumption of consignment as being lost if delivery not effected within 90 consecutive days following the date of delivery stipulated.
  10. Limits of liability in case of loss or damage as 666.67 SDR per package or unit or 2 SDR per Kg of weight.
  11. Limits of liability in case of loss to consignment by air kept as 8.33 SDR per kg in accordance with “Warsaw Convention”.
  12. Network system of liability applicable in case of non deceleration about the nature and value of the consignment and uncertainty about the stage of transport where loss occurred.
  13. Liability for delay in the delivery of consignment limited to the freight payable for the consignment so delayed.
  14. Valuation of the compensation linked to jurisdiction and the commodity exchange rate.
  15. MTO debarred to limit his liability in certain circumstances.
  16. Notice period kept wide.
  17. Limitation of action against the MTO kept wide.
  18. Jurisdiction for instituting action kept as wide as possible.
  19. Provisions of any MTD necessarily to be in accordance with the MTGA.

Inter modal Competition in Logistics and Transport Business

Containerization and Multi modal Transport came about in 1960’s to cut down the cost of cargo handling, reduce ship’s time in port and achieve economies of scale. While the developed countries had advantage of saving increased cost of labour, the developing countries found them in an unenviable position to follow suit in order to survive in the highly competitive situation of international trade. The competition of minimize the cost of cargo handling is not between developed and developing countries but it is among developed countries also.

Now today Multi modal transport and Containerization is fully occupy the process of cargo movement and become only the way to move the cargo. To do smooth cargo movement like developed countries many developing countries are now turning their attention to development of infrastructure even at the cost of heavy capital outlay. Resources being scarce, these countries are in a fix as to how best to deploy the scanty resources. Different modes of transport are vying with each other to take a bite at the cake. The million dollar question is how much to invest for which sector – for roadways, railways or inland waterways. The inter modal competition has thus set in. While the need for investment for shipping and port activities can not be over emphasized, the investment decision for other transport sectors has become crucial in view of balance and logical development of multi modal transport.

The combination of two factors

a) Cost of service

b) quality of service

are important to decide which mode of transport will be preferred by the shippers for transportation.

Each mode of transport are trying to provide best cargo movement solution but there is a limit for every mode of transport. there is some advantages and disadvantages of different mode of transport. It depends upon the cargo which has to move from one part to other part . So, nature of cargo and business is also very important to invest any mode of transport. if nature of cargo and business need any mode of transport specially for itself then sure that mode of transport need more investment.

So nature of business and cargo makes and important role to develop any mode of transport in any nation or place.

n th Root of Complex Number x+iy

In order to find the n th roots of x+iy, at first we change it in the polar form r(cosθ+i sinθ) by putting x=r cosθ and y=r sinθ.

Now, r(cosθ+i sinθ)=r{cos(θ+2kΠ)+i sin(θ+2kΠ)}

because we know that, cos(θ+2kΠ)=cosθ and sin(θ+2kΠ)=sinθ. where “k” is an integer.

there fore, 1/n power of (x+iy)­ is equal to 1/n power of  r(cosθ+i sinθ).  that is equal to 1/n power of r{cos(θ+2kΠ)+i sin(θ+2kΠ)}. That is equal to 1/n power of r multiplied with cos{(θ+2kΠ)/n}+i sin{(θ+2kΠ)/n}.  [as per De Moiver’s theorem].

Putting k=0,1,2,…..(n-1) successively, we get n th distinct roots of n th power of (x+iy).

For example, 1/n power of r multiplied with cosθ/n+i sinθ/n,  when k=0.

1/n power of r multiplied with cos{(θ+2Π)/n}+i sin{(θ+2Π)/n}, where k=1. etc. we can find roots by putting k=(n-1) also .

Again if we give to k other admissible values like k=n, n+1, ………. or -1, -2, -3,……… then we get the same series of values, in same order, as obtained above. Thus we see that there are not more than n different values of 1/n power of (x+iy) are given by.

1/n power of r multiplied with cos{(θ+2kΠ)/n}+i sin{(θ+2kΠ)/n}, where k=0,1,2,3……….,(n-1).