Govt to re­lax curbs on In­dian firms char­ter­ing for­eign ships

The Hindu Business Line - - FRONT PAGE - TE RAJA SIMHAN/N MAD­HA­VAN

The Min­istry of Ship­ping is clearly in re­form mode. On the heels of the re­cent re­lax­ation of the cab­o­tage law, which al­lows for­eign flag ves­sels to op­er­ate in In­dian waters, it is now set to al­low In­dian play­ers to char­ter for­eign flag car­ri­ers with­out any pre-con­di­tions.

At present, a for­eign ship is al­lowed to be char­tered only — among other con­di­tions — if a suit­able In­dian ship is un­avail­able for that pur­pose at rea­son­able char­ter rates.

In fact, the en­tire char­ter­ing rule book is set to see a sig­nif­i­cant sim­pli­fi­ca­tion. These mea­sures will in­crease the ship­ping ca­pac­ity in the coun­try, bring down the cost of trans­porta­tion along the coast and even­tu­ally en­cour­age coastal ship­ping. At present, only 100 mil­lion tonnes of cargo is moved along the coast in In­dia,

The move will en­cour­age coastal ship­ping and bring down lo­gis­tics costs, said Ship­ping Sec­re­tary Gopal Kr­ishna

and 80 per cent of it com­prises petroleum prod­ucts, coal and iron ore.

“While we were re­lax­ing cab­o­tage rules, we found re­stric­tive prac­tices in the char­ter­ing of for­eign ves­sels. We need to cor­rect this quickly,” Ship­ping Sec­re­tary Gopal Kr­ishna told Busi­nessLine.

At present, the num­ber of ships avail­able at the right price to carry cargo (both do­mes­tic and ex­portim­port) along the coast is in­ad­e­quate, thanks to which peo­ple take ei­ther the road or rail route. “Once we have ships avail­able at cheaper rates, we will en­cour­age coastal ship­ping and the over­all lo­gis­tics cost will re­duce sig­nif­i­cantly,” Gopal Kr­ishna said.

An ‘Uber’ for ships

The over­all eas­ing of char­ter­ing rules, he felt, would give a fil­lip to en­trepreneur­ship in the sec­tor.

“By open­ing up, we give chance to our en­trepreneurs who do not have enough funds to buy ships to come into the busi­ness by char­ter­ing a ves­sel,” he said.

The idea is sim­i­lar to cab ag­gre­ga­tion, which does not re­quire an en­tre­pre­neur to own ve­hi­cles. “Our at­tempt is to in­crease ship­ping ca­pac­ity, and a lot of cargo will move on our coast,” he said.


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