IN­FRA­STRUC­TURE NEEDS TO CATCH UP

Maritime Gateway - - Contents -

JAYYANNT LAP­SIAA

PRES­I­DENT, ALL IN­DIA LIQ­UID BULK IM­PORTERS & EX­PORTERS AS­SO­CI­A­TION (AILBIEA)

In­dia’s en­ergy needs are go­ing to rise, as a re­sult im­port vol­ume of liq­uid bulk is cer­tainly go­ing to in­crease in the fu­ture and in­fra­struc­ture needs to catch up to sup­port this de­mand Jayyannt Lap­siaa, Pres­i­dent, All In­dia Liq­uid Bulk Im­porters & Ex­porters As­so­ci­a­tion (AILBIEA)

Q What is your view on liq­uid bulk trade sce­nario in In­dia, and ex­ist­ing in­fra­struc­ture cater­ing to the seg­ment?

A In­dia is a large im­porter of crude oil and veg­etable oil. In­dia im­ports more than 200 mil­lion tonnes of min­eral oil worth over $100 bil­lion and about 14 mil­lion tonnes of veg­etable oil val­ued at about $11 bil­lion. Liq­uid bulk im­ports are spread across ports on the eastern and west­ern coasts. While there is in­fra­struc­ture short­age, in terms of in­stalled ca­pac­ity, tank farms, road net­work, etc., but go­ing for­ward, with in­crease in im­port vol­ume, In­dia needs to in­vest in in­fra­struc­ture ex­pan­sion. Q What are the ma­jor in­fra­struc­ture re­lated chal­lenges? A Ma­jor chal­lenges in­clude berthing, short­age of shore tanks, lack of al­lied in­fra­struc­ture and ship turn­around time, and trans­porta­tion of liq­uid bulk cargo to hin­ter­land. There is even big­ger chal­lenge in case of trans­porta­tion of haz­ardous chem­i­cals to the hin­ter­land. The govern­ment should come out with a holis­tic pol­icy from a long-term per­spec­tive in or­der to en­cour­age the pri­vate sec­tor to in­vest. Coastal ship­ping and use of in­land wa­ter­ways could be help­ful. Q What are the ma­jor trends do you fore­see for liq­uid bulk sec­tor in the short and long run? A Min­eral oil and veg­etable oil con­sti­tute the top two largest liq­uid bulk im­ports in In­dia.

We ex­pect our im­port de­pen­dence on crude oil will worsen from the present 75 per cent to well over 80 per­cent in the next 5 years. Sim­i­larly, veg­etable oil con­sump­tion has been ris­ing rapidly. In last 5 years, veg­etable oil im­ports have in­creased by about 1 mil­lion tons each year. In­dia ex­ports pro­cessed and re­fined prod­ucts of crude oil, hence ex­ports about 5,00,000 to 6,00,000 tonnes of cas­tor oil. Be­sides, In­dia has huge im­ports of spe­cialty petro­chem­i­cals and other chem­i­cals, in­clud­ing soapery oils, which is ap­prox­i­mately 10 mil­lion tonnes.

Q What are the miss­ing links, de­mands and pain points for liq­uid bulk han­dling in In­dia?

A In­dia needs bet­ter co­or­di­na­tion be­tween ports and cus­toms; also there are un­nec­es­sary de­lays on ac­count of con­fu­sion over in­ter­pre­ta­tion of EXIM pol­icy, prod­uct clas­si­fi­ca­tion and at time val­u­a­tion issues for cus­toms tar­iff, sam­pling and anal­y­sis of cargo. All these have to be highly stan­dard­ized and im­ple­mented uni­formly across the coun­try. Quick res­o­lu­tion of dis­putes is crit­i­cal. The coun­try needs more trans­parency and time bound clear­ance of cus­toms doc­u­ments.

Q What kind of gap ex­ists in han­dling chem­i­cal and haz­ardous liq­uid bulk cargo? A

There is an ur­gent need to come up with proper in­fra­struc­ture and wider net­work of road­ways to meet the in­creas­ing de­mands of the chem­i­cals and other haz­ardous car­goes. There is also lack of ba­sic knowl­edge in han­dling chem­i­cals and haz­ardous liq­uid bulk car­goes, which needs to be cor­rected and more safety norms to be in­tro­duced. Q What is the growth reg­is­tered at In­dian ports in liq­uid bulk seg­ment in the re­cent past? What kind of de­mand is ex­pected in the fu­ture? A Over the years sig­nif­i­cant growth has been reg­is­tered at ports in this seg­ment and the de­mand in the near fu­ture is ex­pected to grow by about 20 per cent per an­num, at least for the next 7 to 10 years. Time has come to wake up to re­al­i­ties of the ever in­creas­ing liq­uid bulk trade, and there is a need to cre­ate and add in­fra­struc­ture, in­clud­ing seam­less cus­toms and port op­er­a­tions. Con­tri­bu­tion of liq­uid bulk vol­ume to the to­tal cargo vol­ume is ap­prox­i­mately to the tune of 35-40 per cent for the ports, and the con­tri­bu­tion to the rev­enue of ports is about 55-65 per cent.

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