India Port Strike Inches Closer as Union Attempts Last-Ditch Negotiation
India’s ports are set to endure a strike Wednesday morning, but unions are scrounging together one more effort on Tuesday in hope that a new deal can be put in place for dockworkers throughout the country.
The All India Port Workers’ Federation, which comprises the national coordination committees of six major port workers’ unions and federations throughout the country, will meet in New Delhi with the Indian Ports Association (IPA), the state agency that operates the ports.
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To avoid a strike, the association proposed its most recent offer last Wednesday.
As many as 18,000 employees at the 12 major ports would walk off the job if there was no new contract agreement.
The strikes are expected to affect ports including those in Mumbai, Kolkata and Cochin.
The unions have been in negotiations with the government for nearly three years to try and increase the worker’s pay, as well as other areas like pension, benefits and overtime, but have so far failed to come to an agreement. The last contract was signed on Aug. 30, 2018, and expired on Dec. 31, 2021. The collective is calling for the agreements to be retroactive to January 2022, when the next contract should have begun.
Although the Indian shipping ministry’s wage negotiation committee met seven times in the time since, it failed to meet the port workers’ demands every time, according to a Reuters report.
Strike notices were issued on Aug. 12 after several rounds of discussions failed to reach an agreement.
A port strike would come at a difficult time for shippers given that it is in the middle of the peak shipping season, when retailers are bringing in goods to be sold during the holiday season. Apparel would likely feel some level of impact from a strike, given that India is the fifth-largest apparel exporter in the world, after China, Bangladesh, Vietnam and Turkey, according to data from the World Trade Organization (WTO).
The country exported $15.4 billion in apparel in 2023, which represents 3 percent of the world’s clothing.
According to Indian publication The Hindu Business Line, a strike at the major ports could lead to loss of 125 crore rupees ($14.9 million) for exporters daily.
The country’s 12 largest ports handled 818 million tons of cargo in the 12 months to March, a 4.4 percent increase over the prior year, according to India’s Ministry of Ports, Shipping and Waterways. Inbound and outbound cargo, which encompasses 77.1 percent of total containers at the port, drove much of the year-over-year growth at a 5.1 percent boost in cargo handled.
All container terminals are private berths, so delivery will not be affected in the event of a work stoppage. However, berthing and departing of vessels would be put to a halt, as port employees operate tugboats that pull and push vessels in and out of the ports.
The knock-on effects would likely lead to more port congestion elsewhere, which has already been a problem in major hubs across Southeast Asia. The congestion has mainly been a byproduct of the lengthier transit times of ships after ongoing Houthi attacks in the Red Sea began in late 2023, which resulted in more off-schedule vessel arrivals.
The Indian Ports Association emphasized that any wage adjustment must align with the ministry’s directive, which mandates that the labor cost per physical unit of output should not increase. Consequently, the IPA suggested that individual ports could implement a contract in a phased manner to maintain control over labor costs.
India’s labor concerns coincide with a new contract agreement Saturday for workers at western Australia’s largest port, Fremantle, preventing another 48-hour strike that was slated to start Sunday, at 5:30 a.m. local time.
Terms of the newly agreed on contract have not been disclosed, but vessel traffic services officers and pilot boat operators represented by the Australian Maritime Officers Union reportedly sought an 18 percent pay raise, according to the West Australian. The workers had already rejected a 12.5 percent wage hike over three years, the report said.
“This is a positive outcome that will ensure there is no disruption to shipping lines, importers, exporters, and the public,” said Fremantle Ports CEO Jodie Ransom in a statement. “It shows that respectful negotiation can deliver good results for everyone involved.”
Vessel operators and vessel traffic service operators in Fremantle halted vessel movements to and from berths on August 18-20, but cargo operations and yard operations were unaffected.