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Diversification and innovation are essentials

Diversification and innovation are essentials

PSUs now believe in diversification a railside warehousing PSU is now expanding into cold chains, SEZs and FTZs. Vinod Asthana, MD, CRWC, tells Garima P and Shashidhar Nanjundaiah why this is a natural progression in the competitive world of logistics.

You have to depend a lot on private sector and you do have some very major private players as your clients, that means you must operate as a corporation.
Yes. That is why we do not want people and we do not want to convert into a government company. [Our parent corporation] CWC is already one.

What are the challenges in operating private corporations while retaining the systemic strengths of a public entity?
In the government sector, procedures are very long. And decision making is time consuming. Our priority is decision making at the top of my table. Our staff strength is lean, for example we don´t want to exceed 100.

How do you manage your warehouses locally?
Locally. We provide 100 per cent insurance cover, while all transportation facilities, loading and unloading is outsourced. All our systems are computerized. We have CCTVs and modern applications have been put in place and try to try to reduce original HR cost and try to outsource more and more and see to it that accountability is in place. The whole concept is innovative logistics. We arrange for storage and local logistics of goods at our various stations, so that the client saves on goods´ wear and tear, transportation costs, leakages, etc. We also provide support in unloading and loading. We provide office space to clients. So we are trying to resolve that dreaded last-mile connectivity problem.

How do you monitor the activity?
We do not have to monitor. Within six months, we will link all our warehouses under the Warehouse Management System (WMS), which is in the testing phase.

Then what happens is that you are dealing in an industry which is largely unorganised. But the opportunity you have is to build modern warehouses in our country. Are you addressing the challenge?
Presently we are dealing completely with train movement which means a commodity which moves full train loads. Industrial warehousing is very fragmented but do not need so much capacity, and still lacks a linkage to railway network. That time is still far away. We are now setting up warehouses which are non-railways based in SEZs. Dahej (an upcoming port in Gujarat) is the first, where we have acquired land and the licence. Kochi, Visakhapatnam and Chennai are next in line. We are trying to capitalise on port traffic.

A form of diversification?
Yes. Diversification is required: We have received requisite land from the Railways for Dankuni (near Kolkata) and Ghaziabad (UP), where we are setting up the cold chain warehouses in multi-chamber temperature controlled warehouses. There is a big demand for these.

Marketing must be quite an effort for a PSU. How do you attract your clients?
Warehousing does not require too much marketing because there is such great shortage. Making high end warehouses they found it is not viable, but investment in WMS is a requirement as it brings transparency.

What is your biggest challenge?
Trained manpower. Logistics has somehow not seen the right manpower for this job, whether it is warehousing or logistic or transportation or trying to integrate the financial network.

How have you taken advantage of the Dedicated Freight Corridor (DFC)?
We have tied up with DFC at Marwar on the Western Corridor and Mirzapur on the Eastern Corridor to build logistic parks. We have gone ahead with Marwar with IL&FS as our consultant. Land is already tied up along the Delhi-Mumbai Industrial Corridor (DMIC).

Free Trade Zones in India haven´t taken off. Do you see that as an opportunity?
Absolutely. We are examining how can we enter Free Trade Warehousing Zones (FTWZs) in a big way. GST and land availability are big issues in warehousing.

Marketing must be quite an effort for a PSU. How do you attract your clients?
Warehousing does not require too much marketing because there is such great shortage. Making high end warehouses they found it is not viable, but investment in WMS is a requirement as it brings transparency to the system.

What is your biggest challenge?
Trained manpower. Logistics has somehow not seen the right manpower for this job, whether it is warehousing or logistic or transportation or trying to integrate the financial network.

How have you taken advantage of the Dedicated Freight Corridor (DFC)?
We have tied up with DFC at Marwar on the Western Corridor and Mirzapur on the Eastern Corridor to build logistic parks. We have gone ahead with Marwar with IL&FS as our consultant. Land is already tied up along the Delhi-Mumbai Industrial Corridor (DMIC).

Free Trade Zones in India haven´t taken off. Do you see that as an opportunity?
Absolutely. We are examining how can we enter Free Trade Warehousing Zones (FTWZs) in a big way. GST and land availability are big issues in warehousing.

Central Railside Warehousing Company (CRWC) came into existence in 2009 when Central Warehousing Corporation, to whom CRWC owes its genesis, decided to have more terminals on commercial basis, with coordination between Indian Railways and CWC, in a way to avoid loss in transit and in storage facilities. Reporting to the food ministry, with 20 operational terminals, a turnover of Rs 110 crore and PAT of Rs 45 crore, CRWC provides logistical support and is a logistics company that plans to expand beyond rail into Free Trade Zones and SEZs.

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