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Impact of COVID19 On Indian Logistics

The logistics industry is working hard to catch up with demand and supply that’s being affected by COVID-19. But with the spread of this deadly virus, almost every industry, everywhere, is now being affected. Whether it’s raw inbound goods, a manufacturing level, a distribution level, everybody’s experiencing a pain point somewhere in their supply chain.

It is pragmatic that around 65-70% of loaded vehicles are stranded on roads near the Naka / State borders due to imposed lockdown. Transporters are trying their best to de-stuff the critical goods of their clients to their nearest warehouse / godown but facing problem as labours are not available to unload these goods.

The situation is less critical for cargo movement that occur within a given state, while inter-state movements remain more challenging due to a big drop in Imports from other countries. Intra-movement of goods are also limited as drivers are reluctant to operate on roads due to challenges in getting basic needs enroute. Some drivers have taken Holi leave but not yet reinstated due to fear of contagion.

The most affected areas are Seaports. Vessels are quarantined and not allowed to board at near ports Containers are stuck up at ports due to lack of labours, drivers & trailers. CHA/FF activities are hampered due to unavailability of government & port authorities. Inter-plant or short distance transport movement of raw materials is bit limited due to manpower issues. Many plants are shutting their operations due to limited raw materials, scarcity of labours and safety of workers.

Transporters are working diligently on the safety of their employees while working to mitigate any potential impact on the supply chains and operations of their customers. Transporters are currently working from office with only 30-35 % capacity by imposing limited working hours. The front office staff such as loading supervisors, drivers and operations managers have been provided with the face masks, hand sanitizers and are regularly being monitored for cold. Safety measures are already being followed carefully at facilities, truck stops, and on loads that are traveling across the country.

The transportation world will surely find a way once lockdown is called off but there may just be some delays along the road. Freight rates are expected to increase by 5-8% post lockdown due to high demand across different industries. The vehicle scarcity is not expected but many vehicles will not be operational due to delay in driver comeback. The overall logistics industry will take at least 2-3 months to retain to regularization.

Authored by

Debjit Mukherjee

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