Customs clearances of China consignments begin but industry objects to demurrage charges

Customs officials across the country have started releasing China originated consignments, giving relief to the pharma industry in India. However, the industry is not accepting the fact to pay the demurrage charges asked by the customs officials.

The industry is planning to compile a nationwide data of imposed demurrage charges on each pharma company, and present it to the government authorities.

Dr Dinesh Dua, Chairman, Pharmexcil, commented, “Yesterday, customs authorities of Mumbai and New Delhi International Airport started clearing pharma industry’s consignments. However, Nhava Sheva and other seaports, as well as Inland Container Depot (ICD) Cargo, are yet to start clearance. Since the industry’s 60-70 per cent pharma related import activities take place from both these ports, it must be started immediately to give relief to the stakeholders.

He added, “For per kg, the sea freight is nearly $5 cheaper than air cargo charges and we are optimistic that this will get resolved in the next few days.”

However, a source from Mumbai Air Cargo informed, “The problem still persists, it is far from over. However, lifesaving and medicines are allowed on case to case basis after proper screening and 100 per cent examination. Non-essential imports still face problems and OOC is still not given.  Proper guidelines as to whether these products to be released or not are awaited. The industry expects the problem to be solved in a week’s time. It may be noted that industry is incurring heavy demurrage charges and custodian of the goods i.e. MIAL and CFSs are in no mood to waive any such charges.”

M Madan Mohan Reddy, Director, Aurobindo Pharma, said, “Since last evening, our eight consignments have got released from Chennai customs, which gave us relief. Although, these clearances happened because they were processed and cleared before the delay of consignments started. And today, customs officials at Hyderabad, Chennai and Vizag have intimated us that it will take a minimum of two or more days for new consignments to clear the process.”

He further informed, “Besides this, we have realised that the customs officials have imposed demurrage charges on our consignments, despite no fault of ours. Hence, through Pharmexcil, we will make a request to the government to consider waiving off the charges.”

SV Veeramani, CMD, Fourrts India Labs and Former National President-IDMA informed, “Chennai customs has resumed consignment clearance process of China originated products with a 100 per cent check. But, irrespective of this delay, demurrages need to be paid by individual companies, which is a cost to them and needs immediate attention from the government. We will be approaching Pharmexcil to find a solution.”

Nipun Jain, Chairman, Small and Medium Pharma Manufacturers Association, informed, “The Director-General of Shipping had advised port users, including ICDs, CFS, Shipping lines etc., to not to charge, levy or recover any demurrage, ground rent beyond allowed free period etc., for non-containerised cargo in case of delay in evacuation of cargo caused by reasons attributable to lockdown measures. Despite government’s instructions, Delhi Airport authorities had asked us to pay the demurrage charges to release the consignment. So, we urge government authorities to make a viable solution to this issue.”

The industry is hopeful that the situation will be resolved soon.