Immense potential of coastal shipping brought to the fore at CII’s conference

Coastal shipping and inland water transport (IWT) in India will get a boost if more attention is focused on the needs of the consumer/shippers and if it is seen as part of an integrated, multimodal transport chain.

This was emphasised by Ms Lakshmi Venkatachalam, Director-General of Shipping, while addressing the Confederation of Indian Industry (CII) Institute of Logistics’ conference on ‘Indian Coastal Shipping - The opportunities towards economical logistics’ here last week. She pointed out that shippers needed to be persuaded about the benefits of coastal shipping, and the reasons why they preferred road ("is it easy documentation?") required to be properly assessed.

An overhaul of the Multimodal Transportation of Goods (MMTG) Act could facilitate coastal shipping becoming part of an integrated transport system, she opined.

Ms Venkatachalam, who was the guest of honour, highlighted that the Directorate-General of Shipping was in constant dialogue with stakeholders on enhancing the profile of coastal shipping and, towards this end in 2008, had formulated specifications and guidelines for a new category of vessels called ‘River-Sea’ vessels which had the potential to give a tremendous impetus to the segment.

Earlier, in his welcome remarks, Mr B. Sridhar, Member, CII National Logistics Council and Director of Bengal Tiger Line, described coastal shipping as being in a "challenged" state and, therefore, it was the right time to look at the opportunities in it. The development of non-major ports would give an impetus to coastal shipping, he felt.

Delivering the theme address, Mr S. K. Shahi, event Chairman, President of All India Barge Owners Association and Managing Director of SKS Logistics, sought infrastructure status for coastal shipping. He also wanted strict implementation of cabotage, tax holiday for the first 10 years, 30 per cent subsidy for shipowners, soft loan financing, reduced duties on bunkers and spares, 10 per cent of window/berth space to coastal vessels at ports, simpler manning scales, diversion of government cargo to coastal shipping up to the level possible, and a separate Indian Coastal Register for coastal shipping vessels.

Mr Ashwani Kumar, CEO of Maharashtra Maritime Board (MMB), highlighted that though MMB ports currently handled only 11 million tonnes of cargo, its future plans envisaged a throughput of 300 million tonnes through the BOOST model with a concession period of 50 years.

Rewas-Aware, Dighi, Sindhudurg, Jaigad and Redi were some of the ports for which the concessions had been signed and the facilities were in different stages of development and operations.

MMB was also focusing on ship repair projects and integrated waterfront development, he said.

Mr Sanjay Shroff, Director, Ernst & Young, also sought infrastructure status for coastal shipping, which he said would open the doors to easy funding and government subsidy. Coastal shipping needed an integrated policy for its development, he added.

An Ernst & Young research paper on ‘Coastal Shipping in India - from Challenges to Opportunities’, was released at the inaugural session.

In the first business session, on policy initiatives and tax aspects, Mr Atul Srivastava, Head-Commercial, Gati Coast to Coast, highlighted that improved coastal shipping would boost transhipment at ports and give them the competitive edge, as well as act as a catalyst for the development of an efficient and integrated transport system.

A tailormade tax system could be formulated specifically for coastal shipping, according to Mr Samir Kanabar, Partner-Tax, Ernst & Young.

Mr John Mathews, Managing Director of Master Shipyard Pvt. Ltd, hailed the new River-Sea vessel regulation as a critical positive step for coastal shipping. It would ease construction and operations of such vessels and, therefore, what was now needed was developing a standard product within certain specifications, price and performance parameters. These, according to him, were a price sub—Rs 10 crore, tonnage of 2,000 DWT, capacity 100 TEUs, speed of 8-10 knots and draught of 3.5 m.

Capt. M. M. Saggi, Nautical Advisor to the Union government, called upon the stakeholders to convince the government on "what coastal shipping can do for the country", which will encourage the policymakers to focus on it more closely.

In his opening remarks in session 2, on emerging infrastructure, technology and business opportunities, Mr D. T. Joseph, former Secretary, Ministry of Shipping, said that instead of highlighting the general steps required to give coastal shipping a boost, it was time to focus on the specific benefits so that the policymakers were interested.

Mr Anil Singh, Senior Vice-President and Managing Director of DP World, said that the purpose behind developing the Vallarpadam international container transhipment terminal (ICTT) was bringing Indian cargo back to the country from the nearby hubs and, in the process, reducing costs. The ICTT, which is scheduled for a soft opening in June, would have all the requisites to attract mega international shipping lines and vessels, he stressed.

Mr P. Sridharan, Director (Ops & Tech), Dredging Corporation of India, gave an overview of dredging, the state of the domestic and international market and dredging opportunities on the Indian coast.

Coastal shipping needs the development of a strong, integrated transportation network, stressed Dr Satish Agnihotri, Joint Director-General of Shipping. He suggested the implementation of a "carbon credit" policy in coastal shipping, whereby every dollar earned in savings could earn a dollar of subsidy.

He wanted the trade to be more specific and have a gradual approach while seeking concessions for coastal shipping.

The final session was a panel discussion on ‘Coastal shipping: A prognosis’, which saw participation from Mr Joseph, Dr Agnihotri, Mr Shahi, Mr Mathews and Mr Singh.

Mr Joseph called upon the industry to formulate a minimum action programme on which everybody agrees, so that the issues could be properly addressed.

The day-long conference was attended by a cross-section of the industry.

Source : Exim News Service - MUMBAI, Feb. 8