Tushar Jani is a visionary leader; he has been for the majority of his long and successful career. He remains the only person to have launched a successful freighter airline in India- Blue Dart. But what separates Jani from other entrepreneurs is his focus on empowering the people he employs. At present, Jani is the Group Chairman of Cargo Service Centre (CSC) India, the market leader in cargo handling in India, with more than 2,000 employees and airport warehouses in six cities, including Delhi, Mumbai and Chennai, offering a variety of services with an enhanced focus on pharmaceuticals. Listen to him as he speaks to Upamanyu Borah about India’s fast-growing pharmaceutical industry, how is CSC equipped to create value addition to India’s cargo handling business substantially, and his four-decade-long career which is all about leadership and innovation.
In what way has the rising supply chain costs combined with increasing consumption put more pressure on logistics services?
Today, the Indian pharma industry’s export turnover is approximately US$ 15 bn, and the figures are rising. The country ranks 4th in terms of generic drug production, a 20 per cent market share globally, poised to grow to 40 per cent. India is also the largest supplier of vaccines and drugs to the international child welfare wing of the United Nations. As such, the size of the industry is becoming bigger and bigger, which means two things can happen- either cost can rise or get rationalised.
Well, I believe costs will get rationalised, however when you bring standard and quality, costs eventually go up. With pharma exports from India ever-growing, the country will have to adopt more new or existing protocols for the pharma supply chain such as the Center of Excellence for Independent Validators (CEIV) Pharma or Good Distribution Practice (GDP) Guidelines and this will ultimately increase the cost. It is important that we follow the established standards so that our drugs are accepted straight on to the shelf and India comes at par with Europe, the US or the Far East. For instance, standards will always remain as a differentiator for the companies audited by FDA on a surprise check basis.
Further, moving a product from the factory to the terminal and from terminal to the tarmac under the required temperature, or either shipping it on an active container will add to the cost incurred. Additionally, what will be needed, especially in a country like India wherein a tropical wet and dry climate is more common, are cool containers going on from terminal to the aircraft, now this will also add to cost in terms of achieving standards.
However, I presume where cost can get rationalised is, as volumes go up, more and more freighters will enter the market as it will not be feasible to use the belly space of airlines, and that is how cost can get rationalised. We can then achieve cost which is within the pattern or the limit of what a product can afford to offer.
How do you see real-time data automating the temperature-controlled supply chain? Do you fully leverage the opportunities that real-time supply chain insights provide?
There are abundant technologies off the shelf and companies should be capable of transforming those or effectively manage and leverage them.
Additionally, the temperature within the air cargo terminal is available on our website on real-time basis, while cool container temperature is available online when out on the tarmac, and once the shipment is in the cargo hold of the aircraft, we can be assured that temperature controls are being taken care of along with the positioning of the cold storage unit.
Most recently, our mobile app ‘TURANT’ which offers complete tracking of shipments- both export and imports in a real-time manner as it’s being handled within the facility/warehouse, has expanded to offer an enhanced experience of AWB tracking for our trade partners.
Going ahead, to fully leverage the opportunities that real-time supply chain insights provide, CSC is setting up an in-house control tower to monitor all shipments going through our facility. We are going to feed in data and information coming out from the factory till the shipment goes on board in the airplane which will also be made visible to our customers.
What is critical to fostering a strong airport community, in terms of pharmaceutical handling?
Well, I think there are a few things but they all revolve around the word ‘common’. I think we have to have a common vision and goal, and then subsequently, we will have a common way forward. It is critical to bring together the airport community and explain to them the benefits of effectively handling air freight shipments of pharmaceutical goods which will benefit and boost both the airport and the supply chain, and that this is probably the way of the future.
Being clear and elaborating on the strategies in order to get every employee on board to have a common vision, a common goal, and a common way forward for this, I think, CSC has been able to do that and that’s been the reason we’ve been so successful in a relatively short period of time. By getting everybody on the same page with focussed efforts to improve, not only competency but also operational and technical innovation as a benchmark, CSC has been able to improve the business for everybody.
How do you look at transshipment cargo? How much does transshipment cargo currently add to your business volumes?
Transshipment is always a good business option, it adds value and we are always open to it. We already receive, handle and transship general and time-critical cargo from various stations. For instance, we receive bonded cargo from Ahmedabad, although not much in volume, it’s increasing. Besides, it’s all Indian exports being transshipped.
India is investing in large-scale infrastructure projects which could transform the country’s modal-mix from one that is now dominated by moving goods by road, to one that is more balanced and flexible. Looking ahead, what trends you believe will add to the transportation of critical cargo?
In India, 5-7 per cent of the pharma is shipped by air, rest all by road. But are they being transported or stored even in the most general temperature-controlled manner, the answer is probably ‘NO’! I see that the government is working out on a set of guidelines for domestic transportation of cargo which is expected to reveal new standards for the supply chain, be it general or critical shipments that will be secured within the required temperature.
Now once those are established, critical pharma will most supposedly move by air. Then the ratio would be 60:40. Surface transportation will include the bigger share while air or multimodal will constitute the lesser.
Cargo handling companies are expected to have ‘creative’ ideas to gain business. With regard to that, what will be CSC’s ideal strategies for consolidation in the coming years?
With India poised to consolidate its position in the generic drugs segment, the country will need more freighters. A normal average freighter weighs 90-100 tons, which means accomodating roughly about 30-35 ULD positions. Therefore, the cargo has to keep on coming; we build a unit and store them in 15-25 °C. At present, MIAL is the only airport globally that is going to provide that kind of a required best-in-class infrastructure as an origin point; a freighter comes and turns around in four hours’ time.
I feel proud to assert that CSC is the largest pharmaceutical cargo handling company in India and that we are always ahead of the game in terms of establishing standards, which we will continue to work on. At MIAL, our extended new pharma and perishable cargo facility with an investment of 60 cr will offer a great opportunity to exploit the standards. We will be achieving 14,000 tonnes capacity of cargo handling from the current 5,000 tonnes, we will have 6 docks from the current operational two docks, with setting up 130 ULD positions to be stored under minimal temperature. Besides, we are installing around eight chambers outside in the inspection area so that the product is not deprived of its required temperature, along with a cool container to fulfil almost any temperature requirement up to the tarmac.
I think it’s pretty unique that as a cargo handling company we are trying to intervene in the product when our equity is only up to handling it. However, we are expanding our equity beyond handling into taking accountability and ownership of how to make the product much stronger because CSC believes that India should take a leadership position, and our endeavour is to be present in the 84 airports across India and to tap into the fast-developing global pharma market. Here, not only CSC but India has a great opportunity; I feel the country’s pharma exports will overpass IT exports. With above, it will also open doors for a huge manpower potential, the country will see more people joining the drug manufacturing industry.
Always being an innovative and pragmatic entrepreneur, envisioned, founded and mentored numerous companies with continuing to stay ahead of times in the amazing journey spanning four decades in logistics. Kindly share the evolution of the turning points!
When I entered the industry in 1976, joining the 80-year-old family business of Clearing and Freight Forwarding, air cargo was at its nascent stage. Air cargo imports were received at Ballard Estate since there was no cargo terminal at Mumbai Airport while sea cargo was barely transported in a ship as the concept of containers didn’t exist.
In the early ’80s, with the evolution of containers, I saw great opportunities as a clearing and freight forwarding agent. I remember, as a young man, I went to the commissioner of customs with an application to allow carry containers to textile factories, as they had to first bring the shipment to the port and then load it in the container, and this process drew more than 30 per cent losses. The commissioner understood the issue, agreed to my concern, and then suggested me to devise a robust procedure. Once all of that actually started materialising, losses shrank to only 2 per cent. After that I never looked back, I encouraged shipping more and more factory produce in containers, and that eventually became my forte.
In 1979, DHL entered the Indian market with the aim of oil exploration. They use to have those geo-drawings in hard copy; those drawings come in courier from Singapore and are delivered to the oil exploring companies such as Oil and Natural Gas Corporation (ONGC). I saw it as a great concept; meanwhile, I already stated my air cargo company named Concord International in partnership with one of my colleagues. Those days the garment industry was booming, although, they had a unique requirement to send their samples to the buyer for approval, and there were no courier companies. They either had to post or give it to a forwarding company. We were entrusted with that responsibility, we carried out the task to clear those samples as air freight and then ship it across to their destinations in partnership with Swiss Air. This turned out to be a huge success.
Coming back, DHL was only concentrating on documents and there was no courier service for shipping samples and such. That’s how Blue Dart came to inception in November, 1983. The same year, the American parcel company Gelco Express had set up a store in India. In 1984, the company was acquired by Federal Express (FedEx) and then the entire scenario changed. We started sending onboard courier with samples to London. Sometime we would ship one tonne courier. As such, we were the first to buy onboard courier on international flights for sample shipping. All of that worked well and we prospered.
However, people would often tell us that though you deliver samples from places like Tirupur to London in 48 hours or to the US in 72 hours, from Tirupur to Mumbai there were no delivery options or deliveries happening. So we finally bought in the domestic division of Blue Dart and launches time-definite services for our customers, the first in India by any courier company. Targeted at time-critical business-to-business needs, this guaranteed door-to-door time-definite delivery service by air ensured that documents and small shipments were delivered the next possible business day by 10:30 am.
In the 1990s, the NVOCC business in India began to take roots. One of my then partnered companies called Swift Freight was the first to issue the Bill of Lading; we were the first one to bring in containers on our own, we were recognised almost like a shipping line. I was lucky to be part of such a revolution.
Until 1995-96, Blue Dart had expanded; however, no airline could carry our load as there was no such that existed. Besides, due to some regulations laid by the government on air shipments such as liquids and circuits, Blue Dart had to start its surface transport wing. We started running 12 trucks at the same time from Chennai. The demand started growing and then we felt the need for an aircraft. We soon bought in three Boeing 737 aircraft from Indian Airlines and India’s first cargo airline was set-up. It has been the most profitable airline amongst all, from the time it started operations until today. It runs on 99 per cent bio-diesel and carries around 400 tonnes of cargo every night. Today Blue Dart has six Boeing 757.
Going ahead, in 1986, when internet was still to be implemented in India, Blue Dart was the first company to offer trace and track services, through relay switches with the use of submarine cables which goes underneath the sea to Hong Kong and from there, the information and data was transferred across the world to the carriers and companies. FedEx who was our partner, always believed 50 per cent of the job should solely constitute enhanced transportation methods and 50 per cent should be to give accurate and worthy information to the customers. They wanted information out of India, so Blue Dart had to set up the track and trace mechanism, which later consolidated to indigenously develop in-house software Cosmat II that gives track and trace for all consignments going out across the world since 1986.
So, to summarise, I have been part of a journey that witnessed the buying of first-ever aviation system, track and trace mechanism, NVOCC, and the first to set sail containers, facilitate multimodal transport and set up pharma facility in the country.
I believe God has really been kind to me. I had the best of colleagues and partners, and I heartfully thank them all because it is they who made it, I just played my little role.