COMMUNITY PLATFORM FOR PORTS SHIPPING Mumbai 28 th

“COMMUNITY PLATFORM FOR PORTS & SHIPPING” Mumbai, 28 th Oct 2015

COMMUNITY PLATFORM IN PORTS & SHIPPING Thanks to AMTOI for opportunity to present our experience in industry EDI Profile of our established community platform Suggestions for approach for ports, ocean freight and multi-modal transport

ACAAI: LONG HISTORY IN EDI “UPLIFT” ACAAI explored EDI since 1980 s, with Trade, Airlines, Customs, Mo. C. ACAAI set up CSI (“Community Systems India”) for ACAAI Member air cargo agents to connect with Airlines – early version of what we have today – UPLIFT. This preceded IATA’s e-Freight; Customs’ Icegate; DIAL’s gateway system / MIAL’s GMAX, etc ACAAI pioneered Govt initiatives (Mo. C, Mo. F / CBEC) for EDI development. In 2009, ACAAI appointed Kale Consultants as EDI partner for UPLIFT – “Universal Platform for Logistics and Integrated Freight Transport” UPLIFT is a digital platform facilitating interactions between exporters, importers, CHA, forwarders, carriers, airports,

“UPLIFT” PARAMETERS Must connect all segments of the trade, as also concerned departments / organizations of the government / regulators; Must cover all organisations within each segment; Must maximise coverage of all functionalities and applications; Must interface with systems of all players in the trade (Customs, Carriers, Ground Handlers, Terminal Operators, other Regulators, Banks, Insurance); Must aim to rationalise and optimise processes, yielding cost- and time-efficiencies; Must have guaranteed uptime: tight parameters for (planned) downtime; Must provide maximum security and confidentiality of data; Must be sustainable, with development & enhancements to

“UPLIFT” FEATURES Currently UPLIFT has digitized following interactions: Stakeholders Digitized Transactions / Documents Exporters/Importers – Forwarders / CHB Freight booking, Invoice, Packing List, SLI, pre -alerts Forwarder – CHB Job information, job status, Consol DO Forwarder – Airline E-booking, e-AWB, e-House Manifest, tracking CHB-Customs Shpg Bill, Bill of Entry, Acknowledgements, Status Airline – Customs EGM, IGM, Acknowledgements Forwarder – Customs Consol General Manifest, Acknowledgements CHB-Airport Carting Order, TSP, Vehicle Token, Deliver Order Airline –Airport Segregation Reports, Delivery Status, Carting Approvals Forwarder/CHB/Exporter – Certificate of Origin

UPLIFT for Shipper FEATURES Send shipment data to forwarder online; Upload shipment data from excel or other file formats on to UPLIFT; e-Docket feature: etransmission of shipment documents and archival; Check & validate shipment booking; Receive SMS/e-mail status updates; Door-to-door visibility of shipment transit to destination. BENEFITS Single point data entry: documents & image files Multiple RFQ’s at a single click Single window view Online HAWB for approval Pre-defined formats to integrate with shipper’s internal system. Online chat facility Select milestones to schedule automatic updates Shipping documents online

UPLIFT for Forwarder / Consolidator RFQ’s floated by shippers Airline schedules & space availablity Interact with Customs, custodians, banks and airlines Access profiles of multiple service providers Pre-alerts HS codes Past shipment records from shipper Float RFQs; avail booking online Quote online to multiple shippers Quotation revision & receipt, evaluation / re-negotiation of quotes E-Payments of Customs cess, Customs notifications & circulars Transmission & receipt of shipment documents End-to-end shipment visibility Single window to all custodians Interfaces Forwarder’s internal operation system using flat file, csv, xml and xls

UPLIFT for Airlines Electronic receipt of booking requests Electronic receipt of Air Waybill data Customs interface for transfer of IGM / EGM / AMS/ EU customs Alerts from custodian / agent Single window to custodians for carting orders & shipment status Proper validations at data entry point of shpt booking and AWB processing e-dockets to store data Receive RFQ, Quotation floating and negotiation Raise CAN, CSR / Invoice and deliver personalized alerts and messages to trade partners Status updates on cargo movement to and within airport terminal e-meetings and web casts UPLIFT helps community members share & acquire industry best practices Advertisement of spot offers, discounts and rates

UPLIFT for Airport Custodians Online receipt of validated shipment data Proactive milestone alerts Terminal Charges (TSP) Online TSP payments Shipment data populated online in Custodian’s system Online intimation of e-payments made for TSP and Demurrage Reduced congestion at airport within given infrastructural constraints Proactive alerts for preventing service failures Higher Customer Satisfaction with improved visibility

PREVAILING INDUSTRY ENVIRONMENT TECHNOLOGY PLATFORM: CONNECTIVITY ISSUES & EDI Various hindrances to implementation of EDI in Indian context. Compartmentalised approach to development, esp. EDI: � Need for industry overview, integrated approach, common platform. New EDI Systems are not fully effective against the human factor in operations; Flow of goods and information is not seamless – there are too many stages between the shipper’s door and export uplift, or vice versa from arrival of flight till the delivery to final consignee. Same commercial, customs and transport data entered multiple times during the logistics flow high administration costs and scope for manual errors.

PREVAILING INDUSTRY ENVIRONMENT Processes vary at different (air)ports – no standardization. Governmental agencies not interconnected e. g. Octroi, Customs, DGFT Frequently changing compliance standards create difficulties. No integrated Cargo Community System (CCS) through which all players and regulators can be connected through a single platform, and which provides door-to-door shipment visibility and process functionality.

RECOMMENDATIONS Universal Platform (Cargo Community System) through which Customs, Custodians, Carriers, Terminal Operators, Forwarders, CHBs, other regulators / authorities are connected, for door-to-door shipment visibility and completion of all transactions and processes at and beyond ports. Custodians and Lines may offer incentives for automation in rationalised processes and reduction (& eventual elimination) of paper. Legal / Regulatory framework to allow electronic data as substitute for documents Definition of data exchange standards for processes specific to India Harmonization of data interchange standards Simplification of taxation structures

PRE-REQUISITES Effective implementation needs mandating: � � � EDI Standards Standardized processes Digital Signatures Linking Regulatory Agencies and Acceptance of multimodal EDI.

UPLIFT MILESTONES India’s first multi-modal CCS platform – crossed 3. 5 million transactions; and is the fastest growing CCS globally. Large Airports like Mumbai already adopted the platform. Has delivered 100% electronic messages for 2 large European Carriers in Mumbai – a first in the world. Platform has helped India get catapulted to No 6 Rank globally in efreight from the earlier rank of much below 100. Platform is most comprehensive in the world with participation / connectivity to airlines, forwarders / CHBs, major airports, customs, chambers of commerce, custodians, transporters, ground handling agents, banks. Platform is globally recognized with accolades from KPMG and Kellogg’s Business School

PORTS & SHIPPING SECTOR

Background India’s ranking in “Doing Business” report of world bank is extremely low We require twice the number of documents, about thrice the time to complete EXIM procedures and our costs per unit for EXIM are almost thrice that of Singapore © Copyright. 2015. Kale Logistics Solutions Private Limited

INDIAN ECONOMICS India’s logistics costs are amongst the highest in the world at around 13% of GDP. An average 1% reduction in transaction costs increases GDP by 2. 9% (Source: World Bank) Our rank in Doing Business report of World Bank is very poor at 142. Facilitating trade is a critical factor in determination of the rank. At least 30 types of documents and around 120 copies get generated in the Exports process. most of which has common data. There is a significant opportunity to simplify the documentation procedures and improve efficiencies to reduce logistics costs!

SHIPPING INDUSTRY PAIN AREAS Original shipment documents (Commercial Invoice / Packing List) have most of the data to create subsequent documents, but is exchanged manually. Forwarder / CHB has to access multiple stakeholder systems (shipping line portals, custodian portals, customs portal, bank portal etc) and re-enter shipment data multiple times – time/resource costs. Many paper documents in multiple copies required by multiple parties (e. g. around 120 copies of paper needed to export a shipment etc. ) Automation in the industry is heterogeneous and at most ports there is no single window EDI for the trade to address “Land” side issues. No single point visibility of shipment. Multiple regulatory authorities need information already on other

PORT USER COMMUNITY SYSTEM Stakeholders Transactions / documents Exporters/Importers – Forwarders / CHA Freight booking, Invoice, Packing List, SLI, pre-alerts Forwarder – CHB Job information, job status, Consol DO Forwarder – Shipping Line E-booking, SI, e-BL, e-House Manifest, Tracking CHB-Customs Shipping Bill, Bill of Entry, Acknowledgements, Status Shipping Line – Customs EGM, IGM, Acknowledgements Forwarder – Customs Consol General Manifest, Acknowledgements CHB-CFS/ICD Carting Order, TSP, Vehicle Token, Gate Pass Forwarder/CHB/Exporter – Chamber of Commerce Certificate of Origin Forwarder – Overseas Agent Pre-Alerts

PORT USER COMMUNITY SYSTEM The Port User Community System should not be purely an EDI messaging switch. Processes should necessarily be re-engineered to maximise efficiencies. The system should enable single data entry for the end user. It should be either “one touch” or “no touch” automation All segments to be connected: � Ports (Major/minor/private) � Shipping Lines, Shipping Agents � Consolidators, MTOs, Forwarders, CHBs � ICDs / CFSs � Road and Rail Container Transport Operators, and eventually � Coastal Shipping, Inland Waterways. . .

AS IS EXPORT PROCESS At CFS / ICD 2 Pass Section @ Port 1 CFS Gate Out Pass Vehicle & Driver Details Recorded Vehicle Pass Issued Vehicle No. , Container No. & EIR is checked CHA Submits EIR Copy Time Taken: 15 Mns. Customs Seal / Line Seal & Container # is verified CHA Submits EIR Copy Time Taken: 20 Mns. Shipping Bill & EIR is Verified Time Taken: 15 Mns. 7 Yard Operator CHA Submits EIR Copy Time Taken: 15 Mns. Port Authority Customs Officer 5 Preventive Officer 6 CISF @ Port 3 CHA Submits EIR & SB Copy EIR is Verified and Copy Time Taken: 20 Mns. 8 Yard Operator Gate In: EIR is Verified & Location Allotted Gate Out: Yard Block I supdated Time Taken: 25 Mns. Time Taken: 10 Mns. 4 CHA Submits EIR Copy

TO BE EXPORT PROCESS At CFS / ICD 2 1 CISF Gate Pass OK | Reject Port EIR OK | Reject CHA Shows Port Pass Gate Out Pass Vehicle Details EIR Details SBill Details PORT USER SYSTEM Custom s S-Bill OK | Reject Preventiv e Officer Seal OK | Reject Total Time Taken: 10 Mns. Port Pass CHA Shows Port Pass 3 Yard Operator Gate In: Location Allotted Gate Out: Location Updated Total Time Taken: 15 Mns. Greatly reduced time to check Documents ~ just Minutes

BENEFITS TO STAKEHOLDERS Exporter / Importer Reduced costs Faster e-freight adoption Better customer satisfaction Better planning Security at reduced costs Reduced paper handling Reduced manpower Reduced revenue leakage Carrier Better shipment visibility Reduced inventory Faster movement of goods Reduced paper management Reduced logistics costs Trade facilitatio n using technolo gy Chamber of Commerce Reduced waiting time Reduced costs Faster trips Better customer satisfaction Transport er Governme Reduced paper handling Reduced Costs Compliance to etrade Reduced overall transaction costs Increased exports competitiveness Better security Efficient trade information

KEY RECOMMENDATIONS Reduce dwell times at Ports Reduce overall transaction costs Implement a policy for mandating single window Community System at all Ports in India for trade facilitation Create an interface between CCS and (planned) Customs Single Window system Adopt and mandate EDI standards for key documents such as Invoice, Packing List, Certificate of Origin, B/L, Manifests Implement digital signatures to replace physical signatures Implement a policy of allowing e-dockets instead of requiring physical papers to be submitted Implement near real time interface between port-wise systems and a National Trade Data Repository for access to real time information for policy making

THANK YOU