International shipping lines like the Singapore-based APL, K Line, Wan Hai Lines (India), OOCL, Pacific International Lines and Regional Container Lines are levying this surcharge to recover the additional expenses they incur as a result of congestion at the port.
Congestion at the port has aggravated owing to berthing restrictions caused by the installation of new cranes at the terminal. Berth delays of up to eight days, and restrictions on the volume of container loading and unloading, have increased operating costs for carriers calling at Nhava Sheva. Because of this, a number of carriers have implemented surcharges to recover some of the additional expense, said Michael Zampa, a spokesperson from Neptune Orient Lines.
Three out of the eight cranes in operation at the terminal are being replaced with newer ones to boost productivity. The installation was scheduled for 40 days starting June 20, leading to berthing restrictions for vessels above 260 metres in length.
The installation affected around 30% of the functioning of the port. The cranes have been installed now, but it will take another week or so for the terminal to function normally, said a senior JNPT official.
A ship is berthed after 8-10 days of its arrival at the JNPT container terminal. Once a ship is delayed here, it has to skip at least one or two ports to be back on its schedule. Maybe these three new cranes will speed up the operations at this terminal, said Dinesh Gautama, vice chairman, Container Shipping Lines Association.
Due to congestion at the terminal, some shipping lines have been calling at the Mundra Port in Gujarat for berthing. Feeder vessels are then used to pick up cargo from Mundra and bring them to JNPT, causing an additional expenditure.
There are three container terminals at JNPT the state-owned JNPT terminal, the DP World-managed NSICT terminal and the APM Terminal operated by GTI.
SCI, MSC, Hamburg-Sud and Wan Hai lines are just a few who are imposing surcharges under various heads like equipment imbalance charge, container imbalance charge and Nhava Sheva service charge, besides a whole lot of other heads. It would be very difficult to pin the full number carriers since the charges have such surreptitious names that it is difficult to completely identify them. We are hopeful that the new cranes will greatly improve the productivity at JNPT. While that is the hope, we remain sceptical whether benefits from there will get passed to the trade, said R Venkatesh, VP, Western India Shippers Association.
Meanwhile, the Federation of Indian Export Organisation has expressed its concern on the congestion at JNPT and has asked for immediate intervention of authorities to stall a full-blown crisis.