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No containing the strike in Chennai port

Raja Simhan T. E.

THE `go slow' by the 400-odd workers at the Chennai container terminal berth (CTB) has not only affected the terminal operations for almost two weeks, but also started to affect industries in and around Chennai.

With over 7,000 TEUs (twenty foot equivalent units) boxes stuck inside the port, and on container vessels waiting outside the Chennai port, the inventory level of raw materials for most of the companies is coming down, causing a lot of worry to them, acc ording to sources. Since most units work on a tight, just-in-time (JIT), schedule, the inventory level is normally three-four weeks. Any problem at the port would affect the production schedules.

Further, due to minimal availability of raw materials (which are stuck either inside the port or on vessels waiting outside the port), industrial units in and around Chennai are slowly cutting down their production. And, if the situation continues for a few more days, some of the units may have to close down temporarily, sources said.

While the stalemate continues at the port, with the protesting workers adamant about their demand, companies in and around Chennai are diverting their cargo through Tuticorin port. For instance, Ford India diverted its export boxes through Tuticorin, tho ugh at a higher cost. Ford exports some 150 forty foot equivalent units (FEUs) of car kits every month through the Chennai port. However, following the `go slow', in the last two weeks the company diverted a few export consignments through Tuticorin port , incurring an additional expense of around Rs 30,000 per box, said a Ford official at a recent CII meeting.

It is learnt that Toyota has also decided to bring its cargo through the Tuticorin port. With frequent labour problems at Chennai port, Toyota officials recently had discussions with the Tuticorin Port Trust officials to study the feasibility of shifting permanently to Tuticorin port, said a TPT official.

Another company, Saint-Gobain Glass India Ltd., which has its float glass plant at Sriperumbudur, some 50 km from the Chennai port, has also been affected. The company imports some crucial raw materials and exports float glass through the Chennai Port. S ince the agitation commenced, the company has been using Tuticorin port for both import and exports, albeit at a higher cost.

With the stand-off continuing at the port, Container Corporation of India (Concor) on Thursday sent the first container special from Chennai to Tuticorin. Concor proposes to send daily such specials to decongest the Chennai port. The Chennai Customs is a lso allowing the port users to move containers to Tuticorin by road, while completing the entire documentation in Chennai.

The problem at the port began on May 2, when CTB workers started taking tea breaks as a protest against the non-implementation of the productivity-based incentive scheme. This was upgraded to a `go slow' from May 7, and the productivity dropped to a thir d, from the regular handling of over 100 moves per gang per shift.

Since such a situation has arisen more than twice in the last four months, the user agencies decided to stop work rather than face losses and uncertainty on a daily basis with no solution in sight. Accordingly, the stevedores stopped indenting for gangs from the second shift on May 8, thus bringing to a halt all container operations.

On May 11, at the request of the ChPT, stevedores indented a gang, on the assurance that productivity would be normal. However, the productivity was only about 40 boxes. The port swiftly suspended all the 11 workers in the shift, which triggered a strike by CTB workers.

While the terminal workers got a revision of the incentive scheme in 1999, the CTB workers did not; it has been pending since 1997. Talks for a productivity-based incentive scheme for CTB workers has been going on for over a year now.

The Government Order stopping major ports from signing new agreements with unions without sanction, and removing retrospective settlements slowed down a decision on the scheme, sources said. In a bid to put pressure on the Chennai Port Trust (ChPT) and t he Ministry of Surface Transport (Shipping), the CTB workers disrupted work at various times by way of `tea breaks,' reducing the productivity to 50-60 moves per shift. After the first time, the workers resorted to a `go slow' in January and the ChPT Cha irman `reportedly' agreed to implement the revised incentive scheme prospectively, provided the Ministry gave its clearance. The workers, however, continued their protest, and insisted that ChPT give a written commitment on the implementation.

The ChPT, however, declined, stating that the matter was beyond its purview, and that only the Ministry could give its concurrence to the scheme. The Ministry, on its part, wanted the workers to first report for duty, and then take up the matter with it. Further, as the privatisation of the container terminal was on the cards, the Ministry felt that giving an incentive scheme now would not be viable.

But the workers feel that as the CTB is anyway to be privatised in a few months, there is nothing wrong in giving the incentive scheme, which was a meagre amount to the port trust.

As per the proposed scheme, the incentive would be given to workers on handling 19,000 moves per month in the terminal, and 80 moves per shift. For 80-90 moves, an incentive of Rs 2 per box per person would be paid; for handling 90-100 boxes the incentiv e would be Rs 3 per box per person, and for handling over 100 boxes, Rs 4. The scheme applies to 100 per cent for direct operational staff and to 80 per cent for all others in the CTB. The scheme is understood to be similar to the one at JNPT, the source s said.

Even as the deadlock continues at the port, the trade seems to be losing heavily. Pointed out one port user, by giving out the incentive, the ChPt would lose only around Rs 12 lakh per month. On the other hand, the loss for trade would be over Rs 5 crore daily.

Following congestion for container vessels at the port, the Chennai Feeder Operators (CFOs) on their part imposed a congestion surcharge of $75 per TEU. The India, Pakistan, Bangladesh, and Sri Lanka Conference followed with a similar surcharge. All the 11 container vessels, operating from and to the Chennai port, are stuck at Chennai without any work. The loss for all the liners put together would be around $100,000 per day, said sources.

One container vessel, Tiger Rhythm, which was to carry 900 TEUs, loaded only 91 TEUs and sailed out on May 8 shutting out almost 800 TEUs. Another container vessel, Penang Glory, which was in the berth from May 5, finding no solution in sight sailed out on Friday with 268 TEUs, shutting out 150.

Boxes are not only piled up at Chennai port, but also in Colombo, Singapore and Port Klang ports. If the backlog is not cleared soon, demurrage for containers at these ports would be too heavy for the consignees to bear, the sources said.

For the exporters, the periodical labour problem at the Chennai port is hampering their commitment to buyers abroad. In the last two years, the reputation of exporters in the overseas market has taken a beating, as the Chennai port has been witnessing a `go slow' or a strike without any prior notice, sources said.

The ChPT termed the `go slow' illegal. A notice was issued to the workers to call off the protest and resume normal working immediately, considering the larger interest of the port and the trade. On May 15, the workers were also informed that in the even t of their not resuming the normal working, disciplinary action would be taken against them. However, the workers did not relent, and continued to protest.

To put psychological pressure on the workers, the ChPT also brought in private workers to clear the import boxes at the stack yard. This, however, had no effect on the port workers, who stuck to their single-point agenda -- a written commitment on pa yment of incentive scheme.

On Friday, the workers directly approached the Ministry officials in Delhi on the incentive scheme. However, the officials apparently refused to entertain the workers' request for giving the incentive now, and asked them to first resume work, sources sai d.

With the matter now in the hands of Shipping Ministry, the user agencies are approaching various export promotional institutions and chambers of commerce, to impress up on the Government and the ChPT the need to resolve the issue immediately.

The users, idling the last few days, are hoping that the ChPT Chairman and the Ministry would have an action plan to restore normalcy at the earliest, or in the event of non-restoration, have alternative arrangements.

Picture: Go slow by workers at the Chennai container terminal has affected movement of containers, leading to loss of Rs 5 crore daily.

Picture by Bijoy Ghosh