Blaze at Cargo Warehouse at Delhi International Airport – Airlines Offices Gutted

Fire Started at Cargo Custodian Celebi’s Office

A major fire swept through the import section of cargo terminal of Indira Gandhi International (IGI) Airport here in the early hours of Thursday, gutting offices of several international airlines. Customs office barely escaped the flames. The import cargo could have come under the spread of the fire but timely action prevented the fire from spreading. Thirty-three fire tenders were rushed to the spot which doused the fire in five hours at around 6.30 a.m.. There was no damage to life since the offices were closed for the day.

The first floor of the cargo building that houses the offices of around 20 airlines and the HR department of Celebi, which manages cargo operations at IGI Airport, was completely gutted.

The blaze erupted between 12.45 a.m. and 1:00 a.m. in the first floor of the cargo terminal, located near the Air Traffic Control (ATC) building, which houses offices of around 20 international airlines, including Air India, Air Sri Lanka and others.

The fire brigade was informed at around 1.15 a.m. only, police and fire brigade officials said. Precious 30 minutes were lost.

“There is no damage to cargo. No cargo has been lost. No one was injured,” a spokesperson for Delhi International Airport Ltd. (DIAL), which operates the IGI Airport, said.

[Editor Comments: The cargo custodian celebi is approved by customs for operations in the customs area. The appointment is initially done by ministry of civil aviation and the Airport Authority after an elaborate tendering process. However, the clout of the custodian is such that little action is taken against it by customs or the ministry or Airport Authority. In the past, many complaints against it for delays in cargo clearance were ignored. Let us hope that this case of negligence causing fire will not escape punishment. In a similar case of fire in CONCOR warehouse in Delhi 20 months ago, the guilty are yet to be named, what to speak of punishment. Exporters get compensation by weight on precious cargo.]

Exporters Lose Rs. 100 crore in Fire at CONCOR ICD

Negligence of Official Custodian Alleged

From Weekly World Trade Scanner Vol. XXVII No. 04 dated 21-27 April 2010

A major fire gutted an export warehouse at the Inland Container Depot (ICD) at Tughlakabad in Delhi in the early hours of Saturday, 10 April. Handicraft, garments, pharma products and engineering goods worth Rs. 200 crores were destroyed.

The fire at the LCL part of Inland Container Depot (ICD) at Tughlakabad Saturday destroyed 24 of the 25 warehouses that store goods meant for exports. The ICD is spread over 60 hectares near the Tughlakabad railway station in south Delhi.

Fire Brigade arrived one hour after the fire breaks out even though there was no traffic at early morning on the road. Nehru Place to Tughlakabad is only 10 km.

Who is to Blame for the ICD Tughlakabad Fire?: Hydraulic pipe system which sprinkles water from underground storage when the fire is young did not work on 10 April, the day of the fire, said Fire Chief R.C. Sharma. The crucial half hour to control the fire in the beginning stage was lost.

CONCOR Statement:

Subject: Intimation under Clause 36 of the Listing Agreement

On 10" April, 2010 there was a fire accident in the Export Warehouse of Container Corporation of India Limited (CONCOR) at its Inland Container depot, Tughlakabad due to fire, goods worth Rs.30 crores (approximately) were damaged, as per initial assessment. There was also partial damage to the warehouse building, assessed as around Rs.5 crores. CONCOR’s liability for goods as well as warehouse facilities is fully covered by insurance. 10^th April, 11^th April being Saturday & Sunday, the operations at ICD/TKD were in any case closed. Normal operations for both Import Export have commenced from 12^th April, 2010. Therefore, there was no disruption of operations at ICD/TKD of CONCOR due to this incident.

The equipment did not work when put to use, Fire Fighters say that water was not sufficient to control the fire over 100,000 sq.ft of space.

After 17 years of operations, Concor has not learnt. Saturday’s fire was the third in the depot, but the last two never matched the magnitude the 11th April carnage.

Delhi Fire Service director R.C. Sharma pointed out the technical glitches and said the most important component in the fire fighting mechanism, the hydraulic pipe system, did not work at the depot on 10 April, the day of the fire.

An exporter says that the hydraulic pipes were in the main building which did not catch fire. The sheds in the fire did not have hydraulic pipes but were equipped with small fire extinguishers which were inadequate.

The real work in dousing the fire started only after the big fire engines from far off Connaught place and Prasad Nagar arrived. The local fire stations did not have the resources to handle the fire. The Concor warehouses had inadequate human and infrastructure resources to handle a fire spread over 100,000 sq feet.

CONCOR reacts late: CONCOR officials, however, denied these claims and said they were informed about the fire late. (It is strange that CONCOR should react so late, specially when it comprises of railway officers who are specially trained to handle emergencies 24 hours a day.)

Export Chief Says Rs. 50 per kg for Compensation for Lost Goods is Scrap Price

Fix responsibility on CONCOR says ABS

President of Delhi Exporters Association Mr SP Agarwal says that Concor is asking exporters to file a claim for the lost goods and their website mentioned that the compensation will be a maximum of Rs. 50 per kg. The Export Promotion Council for Handicrafts has circulated a proforma in which the exporters have been asked to make their claims.

Agarwal says that the amount offered is too little. It is a slap on the face of exporters. We are very angry at the mockery of exporters. This is not KABARI BAZAR-RADDI, he says. The lost export goods were valuable quality goods, we want full compensation.

Mr. Lalit Thukral, member of AEPC lost an entire container worth Rs. 65 lakhs in the fire, each dress in the container was priced at $12.5 or Rs. 550. Concor offers him Rs. 25 for each dress which is less than the Rs. 40 worth of cotton going into the dress. A pharma exporter has lost a container worth Rs. 2.5 crore in the fire. Another container containing both handicrafts and garments was destroyed. In all 200 containers are gone, it is said.

Inadequate Response from Government: To protest against this that Delhi Exporters Association delegation met all three secretaries in Commerce, Textiles and MSME. All it got was an assurance of full help and co-operation to exporters. The Secretaries promised to write to Concor for proper compensation as early as pos

What should the exporters get? According to estimates by Academy of Business Studies the compensation to exporters under the law of torts to cover negligence of exporters should cover:

(a) Replacement cost of goods lost at current prices

(b) Loss of margin and incentives

This is the modern day practice. Mere passing on the amount to exporters as and when recovered from the insurance agency by CONCOR will not do. ABS estimates that exporters must get minimum Rs. 1000 per kg for handicrafts and Rs. 1200 per kg for garments. The responsibility for loss due to negligence transit rests with the official custodian of the goods. CONCOR has been duly appointed by the Central Government as the sole official custodian of the customs bonded warehouse. The exporters are paying CONCOR monopoly service charges for use of the facility hence the full liability rests with CONCOR.

Questions for CBEC/DGFT and Railways: CONCOR pays 140% dividend to shareholders but exporters are offered Rs. 50 per kg. for fire damage in CONCOR Premises.

Importers pay huge demurrage and container rent to CONCOR for delays in customs clearances but no redressal by CBEC, DGFT or Railways is in sight. The share of demurrage in the Rs. 3160 crore CONCOR income in 2008-09 balance sheet should consist of demurrage charges recovered from poor importers. This is on account of the monopoly on imports given to the agency by CBEC. It is time to enquire as to why the CONCOR monopoly should not be diluted on account of negligence to maintain the facilities and unreasonable level of service fees.

No accountability for officials or grievance redressed for public in sight. CONCOR invests surplus case of Rs. 1600 crores in fixed deposit with banks. No investment for helping new exporters, importers, small value consignments is in sight. Are the public sector savings meant for investments in fixed deposit or should they not go investment in infrastructure in new, untapped and risky areas. Time for CONCOR appraisal by impartial public enquiry under pressure from DGFT/CBEC/Railways.

Questions for RBI: Reserve Bank lays down guidelines for packing credit limits for pre shipment finance to exporters. Exporters are bound to take risk cover by fire insurance and other acts of God, to safeguard bank funds. Why is transit insurance cover at full value not compulsory till the point of handing over the cargo to the shipping line?