Marine ISO Containers: The Ultimate Packaging without Which Exports Can't Happen
Marine containers, also known as ISO containers, have a long history going back centuries; but they really came into their own in the years of the Korean War (1950-1953) and then the Vietnam War (1955-1975), when the Americans needed to move everything from candy to coke to cannons efficiently, quickly and safely over the oceans. Legend has it that the interior dimensions of the 20' container emerged from the need to not waste any space when transporting the maximum number of cartons with 24 cans of soda pop in them.
Whatever be the reason, generations of manufactured goods after that were designed to fit inside the basic 20' ISO marine container—including variants like liquid cargo in bullet tanks fitted inside the shell of an open container and all sorts of other variants. The basic design remains the same for the last 50+ years now, standardised to a point where it can be moved in a totally untouched-by-hand concept from factory to warehouse thousands of kilometres away. Every stage of movement—forklift, crane, train, truck, ship, terminal, warehouse and more—has been automated around this basic 20' ISO container, also known as TEU or Twenty-Foot Equivalent Unit.
Across the world, this is one standard that cannot and has not gone metric; global cargo will not happen to your country if your logistics chain is not designed around this 20' ISO container, as simple as that. Incidentally, India is the only country in the world that can carry ISO containers 'double stack' on railway trains under electric wires. Everywhere else, double-stack operates non-electric. In addition, Indian sea-ports can now accept container ships bigger than the Panama Canal or East Coast US maximum sizes.
Just as an indication of where we have come in about 35 years, even as we started off about 15 years behind the rest of the world in the mid-1980s. One big reason was the television tube industry, the other was Maruti Udyog, both in the mid-1980s or so.
Around the time Maruti Udyog Ltd arrived in Gurgaon, an interesting new business in used packaging material emerged from what arrived in containers or even as general cargo - everything from marine quality plywood, strong pallets, sponge and rubber pieces as packing material, screws and nails - even the straps used to hold everything together. The Japanese engineers were very happy with the way everything was re-used, and would hold impromptu training sessions for the transporters and labour, on how to dismantle packing material carefully with the correct tools, down to the last nails and screws, so that they could be used again.
I know, because I attended one of those sessions, learnt afresh the Japanese way of re-using everything including packaging aimed at efficiency and minimal wastage, and came away with a small belt-pack of tools as a gift - hammers with prongs on the other end to pry out nails, multi option screwdrivers, smart cutters, chisels and electrical testers. For the Japanese, this was their contribution in reducing wastage and introducing quality as well as lean manufacturing methods, and they were keen teachers. For the Indians, the quality of marine plywood, for example, was better than anything seen in the domestic market then, and it went into making beds and sofa-sets on a large scale.
The sea-containers that everything arrived in, however, often went back empty all the way to Taiwan, Japan or even the US. China had not yet emerged as a strong manufacturing base in those years. Export sea-freight rates from India were therefore as a direct result, very low and competitive. But inland haulage costs and time as well as the delay due to a variety of clearances lined up before a loaded sea-container could get on board a ship from India, often meant that an empty container required elsewhere was re-positioned as empty.
In trade terms it was known as 'MT RePo' or 'empty repositioning' and the thumb rule was that if a container added 7-10 days of its life hanging around in India waiting for export clearances, then it was better to simply send it back as MT RePo. This time period would reduce if more empty containers were required elsewhere or if fuel prices went up—loaded containers consume more fuel and if the freight is low, then that also doesn't make sense.
I recall operating multiple full sets of trains (90-100 teu) from Delhi to Bombay and Madras so that the MT RePo containers could connect to specific shipping time-tables. We needed to send them in absolutely clean condition inside, because turnaround at the other end was measured in hours, after which they started earning a livelihood again as loaded containers. The biggest and most important packaging material of them all was, what else, the marine container itself.
Over the years, seasonal fluctuations aside, whilst the movement of sea-containers in and out of India moved from thousands per annum to millions per annum, the import loaded export MT RePo situation remained a fact of life in India; but for many different reasons.
1) A lot of junk, by way of low-value imports as well as pure garbage like used plastic packaging, metal scrap, radioactive waste and dead batteries, started finding its way into India. Incidentally, in the context of telecom, radioactive emissions are still not considered pollutants by our authorities, as I am finding out lately, in the context of mobile phone towers. So a whole lot of radioactive waste also seeped in. This was all put down to 'liberalisation of the economy', incidentally, amongst other things.
2) A complete economy built around brand new sea-containers being manufactured in China headed towards India for use also as domestic containers (the specs are the same), and what better way to save money than to send them fully loaded at low freight rates, with duty paid on both the goods and the containers, once they arrived in India. Co-terminus with the abject failure of our government in supporting a domestic container manufacturing business is the real big elephant in the container.
3) A specific trade emerged from the oil countries, consisting of container loads of transfer of residence (TR) containers reaching India, packed with everything under the sun, belonging to some Indian abroad returning to India for good. The person is then entitled to bring in personal effects including a motor vehicle per head at low or no import duties. This in turn is linked with the automobile theft business in the world. An expensive car / bike / boat / luxury item stolen from some country is moved to another country, and then from there via one of the trans-shipment countries to the destination country. The "crime" of theft in the origin country is wiped out by the time the stolen car etc reaches destination. Unless very expensive, it is not worth the effort for the insurance companies to follow up.
4)Until a few years ago we were importing container loads of lentils and other agri-produce, with the same containers being used for the export of rice, in this case heavy-duty 20' containers capable of carrying more than their designated permitted weights. A huge turnaround in lentils being grown in India has reduced the incoming loaded containers in this important trade too. The games played behind the export of rice from India need a separate book some day.
The export-import marine container mismatch in India has been creeping up from a lag of a week a couple of months ago, to 15-21 days now at most Indian seaports. And it's not about import-export imbalance only.
The biggest reason is that India simply did not build up capacity in manufacturing marine ISO containers for both domestic and international trade. Even the public sector units, like Container Corporation, which had all the opportunity and resources of the Indian Railways available to them, opted to import new containers from China. It is a well-documented fact that countries, which are into manufacturing, make and use their own packaging material and we have failed miserably in putting up container manufacturing capacities in India. If you look at a marine container—it is the simplest product to make for the steel industry. If a country makes its own marine containers, then the exports have a head-start right from the first shipment onwards.
Remember, I mentioned how we would clean empty containers before sending them on MT RePo?
Well, especially in the agri-produce business, but all other trades too—nothing is cleaner and more beloved for exporters than a new container—and shippers pay a premium based on age and condition.
We missed the container, not just the truck or the train or the ship, and now our exports wait it out for 2-3 weeks or even more at Indian seaports. In that much time, a container goes from China to the US by sea and to Europe by rail and often makes it more than halfway back too.
What we need is a container manufacturing industry in India.
(Veeresh Malik is an activist from Delhi, who continues to explore several things in life.)