Kandla Timber Association (KTA) has recently flagged the concern of prolonged Vessel waiting periods and high upfront IGST burden on imported timber at Deendayl Port, Kandlawhich is reportedly causing crores of demurrage cost burden on the importers. In a letter to Union Commerce and Industry Minister Piyush Goyal, KTA led by Navnit Gajjar, President, representing approximately 1,800 members across the timber trade, sawmill, plywood, veneer and allied manufacturing submitted that pre-berthing delays of vessels can be traced as much as upto 15–20 days or more at Deendayal Port, significantly increasing logistics and demurrage expenses.
According to industry estimates cited by KTA, the timber sector alone has incurred around US$25 million (nearly Rs 225 crore) in vessel-related waiting and demurrage charges over the past 18 months. It further estimates that the annual outflow associated with vessel waiting across cargo operations at the port could exceed Rs 750 crore.
To curb this loss, KTA has called for additional berths and jetties, mechanisation of cargo-handling facilities, better utilisation of existing infrastructure and improved coordination among port authorities, terminal operators and shipping lines. It has also sought an independent review of vessel-wise and cargo-wise data to identify operational bottlenecks and establish measurable efficiency targets.
It has also proposed establishing a dedicated Furniture and Wood-Processing Hub in Kutch, leveraging the region's existing timber, plywood and door manufacturing ecosystem and its proximity to Kandla and Mundra ports.
Apart from demmurage charge burden, KTA also raised concerns over the high upfront IGST burden on imported timber at Kandla port. One of the association's key demands is the rationalisation of GST/IGST on imported timber from the prevailing 18% to 5%. It pointed out that although importers may subsequently claim Input Tax Credit (ITC).
The Kandla-Gandhidham region has an established industrial ecosystem comprising around 3,500 sawmills and timber-processing units, 125 plywood manufacturers and nearly 100 door manufacturers. The sector generates annual economic activity exceeding ₹10,000 crore and contributes approximately ₹2,500 crore in government revenue.