De­mand/sup­ply sce­nario of liq­uid cargo: Reg­u­la­tory frame­work, chal­lenges

De­mand sup­ply sce­nario, reg­u­la­tory chal­lenges ex­port and im­port in­dus­try faces and in­fra­struc­ture so­lu­tions ship­ping com­pa­nies can of­fer, were brought to the fore

Maritime Gateway - - Contents -

De­mand sup­ply sce­nario, reg­u­la­tory chal­lenges ex­port and im­port in­dus­try faces and in­fra­struc­ture so­lu­tions ship­ping com­pa­nies can of­fer, were brought to the fore

At the be­gin­ning of the con­fer­ence, Ram­prasad, Ed­i­tor-in-chief and Pub­lisher, Mar­itime Gate­way gave an over­view on the liq­uid cargo ver­ti­cal. The ever-grow­ing de­mand for en­ergy needs a lot of in­fra­struc­ture. The stake­hold­ers need to take cog­nizance of chang­ing oil move­ments and the need for mov­ing LNG and other pe­tro­leum prod­ucts into the coun­try on mas­sive scale make it inevitable to cre­ate ded­i­cated and cus­tom­ized in­fra­struc­ture fa­cil­i­ties for liq­uid cargo.

Jaf­frey Thomas, Di­rec­tor at Price­wa­ter­house­c­oop­ers (PWC)

In­dia de­tailed on the de­mand-sup­ply sce­nario in liq­uid cargo. LNG has a share of 7 per cent in en­ergy con­sump­tion and spans across var­i­ous in­dus­tries. The over­all re­al­is­tic de­mand for LNG is close to 500

MMC & SCME. This in­di­cates a lot of la­tent de­mand al­ready set­ting in the mar­ket. This can be con­verted by ad­ding pipe­line in­fra­struc­ture and lo­gis­tics ca­pac­i­ties.

In­dia has be­come the fastest grow­ing mar­ket for POL con­sump­tion in Asia. HSG, porter spirit and NAFTA to­gether come for ap­prox­i­mately 55 per cent and a lit­tle more than half of the POL con­sump­tion and this trend is ex­pected to con­tinue fur­ther, Jef­frey added. There’s a pos­i­tive de­mand in LPG space, and the con­sump­tion is ex­pected to reach 36 mmt by FY 2028 from the de­mand of 22 mmts in FY 2017. LPG im­ports have grown to 9 mmt from 3 mmt over a pe­riod of five years, he elab­o­rated.

Jayyannt L. Lap­siaa, Pres­i­dent, All In­dia Liq­uid Bulk Im­porters and Ex­porters As­so­ci­a­tion (AILBIEA) high­lighted the chal­lenges im­porters and ex­porters are fac­ing in han­dling the grow­ing vol­umes of liq­uid bulk cargo. The con­tri­bu­tion of the liq­uid bulk to the port rev­enue is about 58 per cent and in case of ma­jor ports such as Mum­bai, Chen­nai, Kandla, Kolkata, and Visakha­p­at­nam the rev­enue can go up to even 75 per cent. But still, gov­ern­ment and ship­ping com­pa­nies are ne­glect­ing the eas­i­est to han­dle liq­uid cargo with­out lay­ing proper pro­ce­dures. AILBIEA has been talk­ing to the gov­ern­ment and re­quest­ing for a holis­tic depart­ment for han­dling the liq­uid bulk and for ded­i­cated min­istry for the Exim trade.

Anil Yend­luri, Di­rec­tor and CEO, Kr­ish­na­p­at­nam Port Com­pany Lim­ited

in­formed about the de­vel­op­ments at his port for the liq­uid bulk cargo han­dling. Kr­ish­na­p­at­nam has be­come the sec­ond largest ed­i­ble oil port with the han­dling ca­pac­ity of more than two mil­lion tonnes af­ter Kandla. To han­dle the grow­ing vol­umes, KPCL has de­mar­cated enough land wherein more than 4 jet­ties, berths for car­goes, and ded­i­cated pipe­line cor­ri­dors can be built.

“Through such de­lib­er­a­tions trade bod­ies can get to know what the gov­ern­ment is do­ing for the in­dus­try and gov­ern­ment also un­der­stands the re­quire­ments of the trade and the chal­lenges of stake­hold­ers,” shared

SK Rah­man, IRS, Com­mis­sioner – Direc­torate Gen­eral of Goods and Ser­vice Tax, Dept. of Rev­enue, Min­istry of Fi­nance. He de­tailed on the gov­ern­ment’s ini­tia­tives for the play­ers in liq­uid cargo sec­tor fo­cus­ing on GST re­lated is­sues.

GST has brought 95 per cent of sup­plier goods be­low 18 per cent tax bracket. In GST, the tar­iff rates on bulk liq­uid cargo are very less. Tax re­turns fil­ing has also been sim­pli­fied. Ear­lier, ex­porters and im­porters used to file GST1, GST2, and GST3 re­turns sep­a­rately, but now they need to file only GST3(B) and GST1.

Taxes on liq­uid cargo are fairly sim­ple; how­ever, the com­pli­ca­tions re­lated to the pro­ce­dures may be there, clar­i­fied C.P. Rao, Chief Com­mis­sioner GST, and Cen­tral Ex­cise, Tamil Nadu and Pondicherry

re­gion. POL is the ma­jor chunk of the liq­uid cargo, which is not in the purview of the GST sys­tem. States get more tax per­cent­age on pe­tro­leum prod­ucts than the cen­tre, so they don’t want to lose their hold on them. How­ever, the con­sen­sus is build­ing up and once it's brought into the

GST sys­tem, busi­nesses in ship­ping, ex­porters, and im­porters will have a num­ber of ben­e­fits.

(L to R) Jaf­frey Thomas, Di­rec­tor at Price­wa­ter­house­c­oop­ers (PWC); Jayyannt L. Lap­siaa, Pres­i­dent, All In­dia Liq­uid Bulk Im­porters and Ex­porters As­so­ci­a­tion (AILBIEA); Anil Yend­luri, Di­rec­tor and CEO, Kr­ish­na­p­at­nam Port Com­pany Lim­ited; C.P. Rao, Chief Com­mis­sioner GST, and Cen­tral Ex­cise, Tamil Nadu and Pondicherry; SK Rah­man, IRS, Com­mis­sioner – Direc­torate Gen­eral of Goods and Ser­vice Tax, Dept. of Rev­enue, Min­istry of Fi­nance;Ram­prasad, Ed­i­tor-in-chief and Pub­lisher, Mar­itime Gate­way

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