Located a few kilometers away from the Bharat Nagar Bridge in Hyderabad is an Inland Container Depot (ICD) of CONCOR. Known as ICD Sanathnagar, the depot is relatively unknown to even people in the city, probably because pearls, pharmaceuticals and IT is all that marketing junkies highlight about Hyderabad. So, to give our readers a real picture of what’s really happening at CONCOR’s biggest ICD in the South Central India, we spent a couple of days in and around it. Here’s what we found...

Sisir Pradhan | The Dollar Business

Spread over an area of 1,29,135 square metre, ICD Sanathnagar is the largest container terminal under the south central zone of Container Corporation of India (CONCOR). Initially set up in the premises of a railway goods shed complex in December 1990, increased traffic led to the commissioning of a full-fledged rail linked ICD in June 1998. Today, ICD Sanathnagar is well connected by rail and road network to the hinterlands of Telangana, Andhra Pradesh, Karnataka and Odisha.

Night animal

Despite being located in the heart of a busy city, warehousing facilities at the ICD include 2,100 square meter area for export cargo, 4,200 square meter area for import cargo and 4,000 square meter area for domestic cargo. It also has strong room facilities for high-value items, a paved area of 66,000 square meter, with container stacking capacity of 3,000 twenty-foot equivalent units (TEUs) and one full-length rail siding of 45 wagons, to accommodate a 90 TEU container freight train. During the day, the narrow road that connects the container terminal to the national highway, remains relatively hushed, with only the high concentration of offices of transport companies, hinting at the importance of the depot. But come 10 pm, and the hustle bustle near the ICD grows manifold. This, since container carriers are allowed into and out of the depot only between 10 pm and 4 am, because of it being located in the middle of a metropolis.

One way traffic

Located strategically at the center of India, ICD Sanathnagar is well connected to CONCOR’s pan-India network and plays the role of a key logistics support centre for many traders and industries that want to cater to their clients in South India. One of the sore points of the depot, though, is that almost all of its users use Jawaharlal Nehru Port (JNPT). And since there is a perennial congestion at JNPT, ICD Sanathnagar, often, gets a bad name. Speaking about this, Mayank Mathur, Chief Manager, ICD Sanathnagar, told The Dollar Business, “JNPT servers a large hinterland. Hence, it has congestion issues. In order to avoid this, although we started trains to Chennai Port, there weren’t many takers.”

 

What’s interesting is the fact that despite Chennai and Visakhapatnam ports located closer, most ICD Sanathnagar users prefer JNPT. Explaining the reason(s) for this, Mathur said, “JNPT has more frequent ship callings. Hence, exporters and importers prefer it. Moreover, most of our export cargo destinations are Africa, US, Europe and Middle East. Hence, the western coast is preferred.” It’s worth noting that the terminal runs 35 rakes per month to JNPT, but despite this, due to increased cargo traffic, exporters face delays of 24-48 hours. As a result, Krishnapatnam Port, which is located around 485 km away, is emerging as a bit of an alternative. Being located on the east coast, with proximity to international shipping routes and transshipment ports like Singapore and Colombo, Krishnapatnam Port is also expected to play a bigger role in the future. Similarly, some of the other ports on the east coast like Kamarajar Port (erstwhile Ennore) are also developing container-handling capacities and can ensure smoother traffic at ICD Sanathnagar, if users decide to move away from JNPT. This, particularly since the government is trying to promote the Look East policy. Validating this, Krishnapatnam Port Company Limited CEO Anil Yendluri told The Dollar Business, “EXIM trade has grown on the west coast of India, primarily because the traffic is west-bound, with US, Middle East and Europe being primary trade destinations. However, the Look East policy should help increase traffic at the ports on the east coast.”

 

Missing users

In recent months, one of the biggest question marks on ICD Sanathnagar has been regarding the impact of the bifurcation of Andhra Pradesh. But now that the issue is resolved, the ICD is trying to put the slowdown of the last two years behind it and looking forward to business as usual.

There are certain issues crippling it though. For example, ICD Sanathnagar officials are not very happy with the user response to its reefer containers train. “We made huge investments to launch reefer trains from the ICD. CONCOR, in association with South Central Railway, launched train services to carry reefers, primarily loaded with pharmaceutical products meant for export. The first service of container trains, carrying seven refrigerated containers to JNPT was flagged off in November 2012. For the convenience of exporters, we invested a large sum to create the necessary infrastructure like power plug-in points to run the cooling motor of reefer containers. We also loaded the trains with high capacity diesel generator sets to ensure uninterrupted power supply on board. However, we are not getting the required cargo volume. Due to lack of traffic, we have also restricted train services to Chennai,” an ICD official told The Dollar Business.

Citing one of the reasons for such lackluster response from exporters, another ICD official said, “We are facing competition from private transporters. In a government set up, there is a specific mode of operation. Reefer containers are always in high demand, which means shipping lines don’t want to bring them in advance. Unlike a private logistics company, which can bring in reefer containers from Mumbai to Hyderabad within a short notice of just a day or two, CONCOR, being a government agency, has to follow certain guidelines. Our rules require exporters to book containers well in advance. So, many exporters are moving away from us to private logistics companies.”

 

Hot competition

The container terminal is also facing competition from a Central Warehousing Corporation operated Container Freight Station (CFS), located at Kukatpally, just a stone’s throw away from ICD Sanathnagar. Private players too are also upping the ante. For example, BATCO Integrated Logistics has set up a 1,500 TEUs per month capacity CFS in the city. On its part, ICD Sanathnagar is also not leaving any stone unturned to improve efficiency. In a bid to reduce congestion, it has developed a terminal at nearby Nagalapalle, which is dedicated to handling domestic container traffic. Since 2012, all outward domestic traffic has been shifted to Nagalapalle.

The Nagalapalle container depot has worked as a supplement to ICD Sanathnagar, since the latter is located inside city limits, has limited space to expand, and has restricted traffic movement. Speaking about the Nagalapalle depot,  V. Kalyana Rama, Executive Director (South Central) of CONCOR told The Dollar Business, “Ever since the Nagalapalle depot started operations, it has eased domestic cargo traffic-load on ICD Sanathnagar. As Sanathnagar has limited land to expand, we want to develop Nagalapalle, which is located just 55 km away, as a multi-modal logistics park (MMLP), which will fulfil the existing and future demands of both domestic and international container traffic. However, the state government is delaying allocation of land for the second phase of expansion of the container depot.”

Explaining the growth potential of container traffic in the region, he said, “Hyderabad and its neighbouring region has power scarcity. Hence, the import of solar panels will keep growing in the future. Moreover, P&G and Johnson & Johnson have proposed to set up manufacturing and warehousing facilities in the region. Hence, container traffic will register an upward trend.” It’s worth noting that currently, export cargo handled at the terminal include ceramic tiles, paper, granite and slabs, drugs and electrical goods, while import goods include wooden furniture, asbestos products and household goods.

For the future

To cater to the future demands of container traffic, ICD Sanathnagar has now started electronic clearance of export-import documents. The ICD also provides value-added services like stuffing and de-stuffing of cargo onto containers right inside the factory site of users. Its container handling infrastructure includes four reach stackers, one sling crane telescopic boom, four mobile sling cranes, eight forklifts, one battery operated fork lift, one magnetic crane and 23 trailers. It has a 10-feet-high concrete wall around it for the safety and security of cargo. The terminal also houses a dedicated bank and provides air cargo facilities on demand. It has two railway sidings – one for domestic and other for EXIM cargo. The terminal operates 24x7 and for fast clearance of goods, has a dedicated customs team, headed by a Deputy Commissioner of Customs.

The ICD’s proximity to Hyderabad international airport also gives it an added advantage, allowing it to deal in international air cargo. Looking at all these factors and being a first-hand witness to the dedication of its officials, one has no doubt that ICD Sanathnagar, minor issues notwithstanding, will play a decisive role in the growth of international and domestic trade in the newly formed state of Telangana. [Fingers crossed.]