Bonded Trucking: Charting a new offering to the top

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With the globalisation of markets and swiftly growing Indian E-commerce industry, transport or trucking industry professionals need to be ready to acclimatise to the ever-changing landscape and deliver excellent services to the potential customers. Custom bonded trucking, though considered as relatively new concept in India, has been benefitting the Indian logistics industry, since last two decades, in many ways. Bonded trucks carry cargo in remote areas– tier III and tier IV cities wherein airlines cannot operate. Variety of cargo, viz. pharmaceutical products, perishables, machinery, apparel, dangerous goods, etc. are transported via bonded trucks from Air freight Stations (AFS) to the final destination (warehouses/customers).

Indian trucking industry majors- Shreeji Transport, TT Aviation, TVS Logistics and Om Logistics, etc. has successfully ventured into custom bonded trucking and operating in the sphere, ensuring safe, fast and timely delivery of cargo to the nook and corners of the country. Today, the concept of bonded trucking is being well adopted by the players as it has improved cargo operations at the airports.

Acknowledging the same, Dileepa BM, CEO– BondedTrucking, Shreeji Translogistics says, “Bonded trucking has been in India from the last 21 years. Most of the airlines are utilising bonded trucking facilities in one or the other aspect for export or import cargo.”

Bonded Trucking: smooth road ahead?

Though the industry has a sufficient number of bonded trucks with huge capacities to carry the cargo as swiftly as possible, there are a few hindrances which need to be addressed for smoother and faster cargo transportation. Experts aver that due to higher dwell times, cargo lies at the AFS for many days; it leads to delays and somehow affects the relationship and rapport between end-users and customers. Also, the experts seek simplified procedures for security compliance at the AFS so that the cargo is moved efficiently and competently.

Commenting on the same, Dileepa says, “Bonded trucking operations are high risk operations. In case of export cargo, we need to connect the cargo at the destination. Hence, we need to make all necessary arrangements at destinations to offload the cargo immediately on arrival; failing connection of cargo will end up with penalty from airlines. In case of import cargo, we have to do the loading only on customs working day. We can’t take permissions from customs on holidays. If there are continuous holidays, we have to wait for the next working day only which leads to delays in deliveries. We have well-trained drivers to carry out the operations. Drivers are thoroughly educated about the importance of cargo and its time-bound delivery to the destination.”

Along the same lines, J Govindarajan, Director, TT Aviation Handling Services informs, “The government/customs authorities are expected to take adequate measures to ease the procedures and quicken the process time and also permit the bonded truckers in India for cross-border movements, similar to what is currently permitted and performed in Europe and the US. Bonded trucking activity is an extension of airline which facilitates the carrier to use the space from the terminal point to regional levels including remote areas. This kind of trucking mainly facilitates the freight forwarders to transport the cargo from one offline origin city to the online city. This allows the international carriers to move the cargo to various destinations in India through bonded trucking from a particular termination point. The carriers/ freight forwarders/exporters use bonded trucking to optimise their logistics cost.”

Further Govindarajan informs, “The gvernment will facilitate development of a data platform for monitoring the bonded trucking performance/growth/revenue/yield centrally (like WorldACD: Air Cargo Market Data to monitor air cargo export market) which will be a tool to assess the market potential, performance and growth. The government will come forward to reduce the threshold for Bank guarantee waiver quantum (i.e. to/from an airport – from 2500 MT to 500 MT per annum) to make the bonded trucking services in India cost-effective, creating a competitive environment.”

Despite the emerging prospects, there are challenges such as congestion of vehicle/cargo at loading/unloading areas, customs delays due to non-availability of officers at times and  customs server (IceGate) issues and non uniformity in the processes/procedures followed by different custom officers with respect to permission/bond/bank guarantee waivers, etc. and the ones faced by the bonded truckers such as lack of manpower and shortage of handling equipment in the loading/unloading points (airport operators/custodians).

Recently, Celebi Delhi Cargo Terminal Management India has collaborated with Shreeji Translogistics to start bonded trucking service from Kolkata, Indore Airport, Vizag and Goa to Celebi Terminal Delhi IGI Airport in order to provide their customers with the possibility to move air cargo in an efficient, safe, process-driven and cost-effective manner. Arvind Aggarwal, Senior Manager, Business Development, Çelebi Delhi Cargo Terminal Management India, highlights some of the salient features of its bonded service from Ludhiana:

  1. Time-bound deliveries.
  2. No volume constraints- A small shipment can also be planned with the same proportionate cost and time.
  3. Assured daily departures for express products.
  4. Minimal handling to avoid damage to shipments.
  5. Dedicated arrival to truck dock at Çelebi warehouse.
  6. GPS-enabled app on mobile devices for live tracking of cargo. Transparent shipment status at all levels of value chain.
  7. Assured same day connection on the booked flights.
  8. Celebi’s booking App for truck bookings.
  9. Consolidated product offering at competitive rates.

Om Logistics has been a long-term partner with Çelebi for any trucking requirement they wish to offer to their customers anywhere in the country, and are willing to provide customised solution to make it a value proposition for all stakeholders in business. According to Akash Bansal, Executive Director at Om Logistics, “In addition to Celebi’s scheduled trucks operating between city pairs as per scheduled timetable, ad hoc trucks are available upon request.” This service also offers customers enhanced catchment area connectivity. Now cargo from Amritsar, Jalandhar, Phagwara and Ludhiana can be Customs cleared at OWPL ICD facility in Ludhiana, points out Bansal.

Shreeji has been operating custom bonded trucking from the year 2002. At present, the company offers bonded trucking services from 16 airports in India, including Kolkata, Indore, Vizag and Goa. In the month of September this year, Shreeji had an agreement with Celebi to move the latter’s cargo from Kolkata, Indore, Vizag and Goa airport as well. As Celebi is one of the biggest terminal operators with a good customer base, bringing in cargo through these stations, Shreeji can utilise its bonded trucking facilities to increase the volume of cargo from Delhi.

Is bonded trucking cost-effective?

Experts often complain about high dwell time taken by bonded trucks for transporting cargo at the required destinations considering poor road conditions and connectivity, especially in the remote areas, ultimately resulting in higher costs incurred. However, Dileepa feels that it is cost-effective. “At present, we are having very good roads connecting all airports. We have standard timings for each sector and we achieve on-time delivery of cargo,” asserts Dileepa.

Bringing to light the underlying factors, Govindarajan elucidates, “Bonded Trucking is done only from a customs bonded area location to another bonded area location. Route validation/ transit time estimation is done prior to accepting the cargo for movement considering the road conditions along the route to maintain the transit time to connect the cargo to the flight without failing. Local city entry restriction by RTO is the major factor to be considered while calculating the transit time for flight connection. Our company has developed a mobile app called ‘TRUCK WATCH’ as an additional feature to airline/freight forwarders/customers to track and trace the movement of the shipments in real-time online. Generally, the dwell time is around three to four hours if the required documents are kept ready before the arrival of the cargo to the airport. No doubt, bonded trucking is cost-effective as compared to air freight rates.”

Bonded Trucks: Capacity &Availability

Shreeji Translogistics owns around 300 trucks and augurs well to for their bonded trucking operations. “We have different size of trucks like 20ft trucks, 24ft trucks, 30ft trucks, 32ft trucks, multi-axle vehicles, which have different weight carrying capacity,” says Dileepa.

Talking about the capacity of bonded trucks, Govindarajan says, “Closed-body trucks (with customs sealing facility available) of various capacities can only be used for bonded trucking.  Packed bulk cargo (in drums/bags, etc.) are transported mainly through bonded trucks. The capacity depends on the dimensions of the cargo; the maximum capacity will be 20 MT of dense cargo in a bonded truck (i.e. in a 40ft closed trailer).”

Safety & Security

Bonded trucks can be operated to destinations where airlines cannot operate their flights. Therefore, it is the job of the truck driver to take necessary precautions while transporting cargo from the AFS to the warehouse, safely and securely. From apparel, perishables, heavylift products, machinery, to dangerous goods and odd dimension cargo (ODC), custom bonded trucks carry all types of cargo from airports. GDP guidelines/RTO rules and other necessary approval processes relating to road transportation of all types of special cargo are to be cleared and adhered to for safe and secured cargo transportation. Besides, the drivers need to be well-trained and fully briefed about the measures to take care of in-transit while carrying special cargo and the emergency response on occurrence of any incident. Here, Dileepa informs, “Shreeji moves transshipment cargo from customs notified air cargo complex to another within India. We have to take precautions while carrying cargo other than general cargo. Perishable cargo is carried only in refrigerated trucks. DG cargo will be moved only in dedicated trucks, it will be co-loaded with any other cargo. In regard to ODC cargo, further instructions outlined by customers are strictly followed. It will be covered under Special Contingency Insurance Policy.”

Future of Bonded Trucking

Industry players believe for a better future of the bonded trucking industry in India, the need is customer-friendly customs and custodians rules and tariffs. According to Dileepa, “If custodians stop multiple handling charges for the same cargo, surely there will be huge tonnage that can be carried through bonded trucks.”

Meanwhile, Govindarajan says, “Airlines/freight forwarders considers on bonded trucking to remote areas/from hub-terminal point to another destination on account of better road infrastructure and cost-effectiveness. The government’s focus on export growth, infrastructure policy of connecting the country, and the quality and cost-effective services offered by ICDs/CFSs to the customers as compared to the airport terminals will create the road map for efficient bonded trucking services in India.”

Driving ahead

Even though custom bonded trucking has come a long way, it still remains underutilised because of the complex policies framed by the government of India and fewer airlines operating, as compared to other countries. For transporting cargo via bonded trucks, special permissions have to be taken by the gateway customs office, which is time-consuming and expensive. Besides, consolidation of cargo should happen. One truck should be allowed to carry mixed cargo for different locations. If taken seriously, it will help the industry in the coming years.

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