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Raja Simhan T.E.

Some of the Indian IT companies are not aware of the opportunities CSI holds. " We are not aware of the CSI, and hence cannot comment on the opportunities for us," admitted an official of a large IT firm. An official at Cognizant Technology Solutions said the opportunity from CSI was " huge'' and the company was working on it.

CHENNAI, April 13

THE Container Security Initiative (CSI), part of the United States' homeland security moves, is likely to create a huge opportunity for IT companies to provide customised solutions to retailers, manufacturers and distributors.

CSI could herald sweeping changes in supply chain management around the world and IT would enable companies to meet the challenge, Ms Michelle Jones, Vice President, Marketing, Covansys Corporation, told Business Line.

"The potential for the IT industry from CSI could be as big as the Y2K phenomenon and could run into billions of dollars around the world," she said. It was too early to provide any data and no formal study had been done by any of the research agencies, she added.

Announced in February 2002, in response to the September 11 terrorist attacks, the initiative aims to tighten reporting requirements for cargo going into the US. Under the CSI, the US Customs announced a 24-hour Advance Cargo Manifest Declaration Rule from February, which had a ripple effect on the ocean-going cargo— approximately 90 per cent of the world's cargo moves by container.

The 24-hour rule required exporters to electronically file detailed information about the cargo with the agency prior to loading ships headed for the US.

The trade can use a service provider or port authorities to transmit data on behalf of the trade or a direct interface could be established between the company and the US Customs.

The CSI is to ensure that about six million sea containers entering the US are free from external attacks including from terrorists. The CSI would have far-reaching effects on the supply chain, and the retailers, manufacturers and distributors need to rely on technology to effectively manage their supply chains, she said.

The "Sunrise Date'' was another big opportunity for IT firms. On January 1, 2005, The Sunrise Date, the Uniform Code Council (UCC), the governing body that issues barcodes, would no longer support the current 12-digit UPC (Universal Product Code) barcode.

Databases and processes that rely on the 12-digit standard will need to be altered to manage the new standards. Companies unable to meet the new standards would face costs associated with re-labelling goods, finding new suppliers, or being shut out of markets, she said.

A secure and effective supply chain relies on Global Trade Item Numbers (GTINs) as a critical tracking and auditing tool. Barcodes, such as the UPC codes used by American companies, are one type of GTIN, said Ms Jones.

The CSI and The Sunrise Date are expected to force fundamental changes in both immediate and long-term supply chain practices around the world. All these could be achieved using customised software, she said.

The US-headquartered IT firm, Covansys, was currently involved in educating customers on the CSI impact on their business, and how they can adapt their business systems to optimise their supply chains, while meeting these new security and trade requirements, she said.

In the second stage, the company would provide customers customised IT solutions, which could be done from its offshore development centres in India, including Chennai cost-effectively.

IT companies would be required to provide secure supply chain solution to help retail and distribution companies develop customised solutions to address the US regulations, and Covansys is rightly placed, being the first mover in the IT sector, she said.

According to shipping sources here, to meet the US requirements, major shipping lines, including APL, have extended the electronic-commerce technologies to include their customers.

APL has also enhanced its HomePort portal, a transactions-based Web site to enable customers to more easily transfer shipping information.

According to Ms Jones, Covansys recently launched a CSI information portal - CSI Institute (www.csiinstitute.com) - and a white paper entitled "Barcode Issues: Sunrise 2005 & The Container Security Initiative". Both resources are intended to help educate retailers, distributors and manufacturers about the short and long-term impact of the rapidly evolving CSI.

Some of the Indian IT companies are not aware of the opportunities CSI offers.

" We are not aware of the CSI, and hence we cannot comment on the opportunities for us," said an official of a large IT firm. An official at Cognizant Technology Solutions here said the opportunity from CSI was " huge'' and the company was working on it.

There is no information found in any of the Web sites of most Indian IT firms.

This showed that they were not aware of the CSI and its potential, said sources.

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