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Indian exporters have slammed shipping lines over the country’s continuing container shortage and soaring freight rates – but carriers say the worsening trade imbalance is to blame.

Last week, the Engineering Export Promotion Council of India called on the government to set up a regulator to rein-in what it claimed were “monopolistic” practices of shipping lines. Meanwhile, the Federation of Indian Export Organizations (FIEO) said the lack of available export containers was jeopardizing delivery commitments to foreign buyers. However, shipping lines claim the widening imbalance between exports and imports is the cause of the equipment imbalance and increasing costs.

For example, between April and August, India’s exports fell 26% but imports plunged 43%, and they claim souring relations with China and the Covid-lockdowns, accounted for the big drop in import cargo.

The market is facing a shortage of containers in some pockets, and with exports from different parts of the country rising, there is a need to position empty containers accordingly, thus adding to the overall cost of logistics. According to Sunil Vaswani, executive director of the Container Shipping Lines Association (India), carriers incur some of the highest port charges in the world when calling at Indian terminals.

“The unit cost per move works out double, or almost triple in some cases, those at neighbouring ports like Singapore, Klang, Colombo and Jebel Ali,” he told The Loadstar.

The country’s cargo mix is also to blame, as India’s imports are mostly 40ft container-driven, whereas exports are largely catered for by 20ft boxes – an imbalance with operational and financial consequences.

Source: The Loadstar