What are the types of transit methods? Advantages and disadvantages of air, rail and road transit
What is transit and how goods transit take place? These questions can be asked by many newcomers to the world of international trade. There are some similarities and differences between transit and exports and imports. There are different ways for goods transit including rail, land and air; also goods transit has some rules. This article of Sindbad is about the meaning of transit and different ways of it.
What does transit mean?
In today's world, many countries produce lots of their domestic needs, but to meet some of their needs they still need using goods of other countries. Therefore, any country, no matter how self-sufficient, will still need to import and export some goods.
So, according to the above explanations, the exchange of goods between different countries with each other is called transit. In these exchanges between countries, the exporting country exports the goods in which it is capable and can export the desired goods to the countries in need of those goods. The exporting country can receive international currency for the goods it exports or use the export goods of that countries if necessary and import those goods.
Above concept is known as thorough transit. Inward transit is also important. In other words, transit is not limited to importing and exporting goods to other countries but exchanges of goods between different cities in a country is called inward transit.
There are more information about Inward and thorough transit in our other article called “What is Transit and what the types of Transit are? The differences between Inward Transit and International Transit”
What is the importance of transit?
In a country like Iran, transit a lot of foreign exchange earnings. International transit is very competitive. All countries in this competitive market are trying to regulate the rules that give them a competitive advantage over other countries. Traders always do their best efforts to choose the most low cost way of goods transit.
Different methods of transit
There are different methods of transit. Choosing between these methods depends on the distance between origin and destination, goods type, and geographical and political condition. Generally, goods transit is done through the following three methods.
- Air transit
- Rail transit
- Land transit
What is goods air transit?
Air transit is one of the most important methods of exchanging large-scale and high-speed goods between the two countries. In air transit, goods are transported by cargo planes.
Different goods are exchanged between two countries. Some of these goods don’t have expire date but lots of them including food and agricultural products, are limited to one expiration date, so the transit process must be done in less time. That is why air transit is the best option for these categories of goods.
Advantages of Air Transit
- High speed goods transit
- Large quantities goods transit
Disadvantages of Air Transit
- High cost compared to rail and road methods
What is road transit?
Road transit is one of the most widely used methods in the transit of goods, especially in the country. Comparing with the other methods of transit, road transit is slower and because of its less costs, it is more popular.
Road transit can include the transportation of a variety of goods such as agricultural, industrial, retail, clothing, food, home appliances, office supplies and raw materials.
In this kind of transit, more attention should be paid to the type of goods that are going to be send; so it does not cause damage to the goods over long distances. For instance in road transit, the trucks for transport foodstuffs should be proper for foodstuffs or for transporting industrial parts, powerful trucks, special packages and safety equipment should be used.
Advantages of road transit
- One of the main limitations of air and rail transit is that it cannot be used in all cities of a country. Sometimes the distance from the place of unloading to the delivery of goods is several hundred kilometers, which itself requires a lot of money and time. But road transit by truck is possible in almost all cities and towns in a country.
- Truck traffic in road transit allows door-to-door cargo delivery.
- The timing of the truck movement and loading is in accordance with the conditions of the sender of the goods.
- Suitable for commercial goods and shipments that do not have special storage conditions.
- Comparing with rail and water transit, road transit is faster.
Disadvantages of road transit
- Its speed is much slower compared to air transit.
- Each truck is able to transport a very limited volume of goods and therefore a large number of trucks must be used to transit a large volume of goods. Therefore, the necessary coordination will be more difficult.
- The risk of road transit is higher due to some problems such as accidents.
What is rail transit?
Transit of goods through the rail system with passenger and freight trains is also a very efficient method. Comparing with other methods of transportations, rail transit is safer and has fewer rail accidents.
Goods are transported by rail and freight trains. Special rail infrastructure must be available to move goods between the two countries. In the following part there are some of advantages and disadvantages of rail transit.
Advantages of rail transit
- Less risk compared to road transits
- Less cost compared to air and water transit
- Faster compared to water transit
Disadvantages of rail transit
- It is limited to rail system; therefore, like air transit, sometimes the distance between the place of unloading and the delivery of goods reaches several hundred kilometers.
- It is slower than air and road transit
What is water transit?
In this method, loading is done by special cargo ships and mostly by countries that both have border ports and is not done in our country. This method is only related to the export and import of goods into the country and is often used for super heavy loads.
Advantages of water transit
- High security and low risk.
- Large volumes of goods can be transited at any one time.
Disadvantages of water transit
- Much slower speed compared to other transit methods.
- It is not possible to deliver at the door. Therefore, like air transit, sometimes the distance between the place of unloading and the delivery of goods reaches several hundred kilometers.
Does goods transit require license?
Transit takes place between countries and on a large scale. Therefore, all countries are constantly trying to simplify the steps transition. Countries in a transit process try to reduce waste of time and administrative costs by concluding contracts and agreements. This is why the law stipulates that the foreign transit of goods entering the country does not require any license within the limits of the agreements concluded between the governments of the two parties.
There are some exceptions too. Each country has its own rules. For example it is prohibited to import some goods to Islamic countries. Security agencies provide the government with a list of goods banned in the country. On the other hand, some goods at certain times and depending on the conditions of society may require the necessary license and coordination.
What is the duty of customs in goods transit?
Generally, special supervision should be done on the transit process. The main responsibility of supervising and handling goods transit is the duty of the Customs Organization. Accordingly, the customs and related organizations have a duty to provide adequate warehouses and areas for the unloading and storage of foreign goods.
To provide these services, customs receives a certain amount of fee in accordance with the law. Changes in the packaging or completion of transit goods are possible under the supervision of customs authorities and are not prohibited by law.
Furthermore, in cases where the obligation is to transport the transit goods by container to the points of entry, the customs and relevant organizations are obliged to provide the necessary facilities for unloading the goods at the customs premises or transferring the goods from the container to the truck, wagon or plane.
The last word
The meaning of goods transit and its process are among the topics that were discussed in this article along with various transit methods such as air, road and rail. Each method of transit of goods has its own advantages and disadvantages.
Which method of goods transit have you used?