Increase in coastal shipping to help save billions, add jobs

The Government’s plans to increase share of freight transport through the coastal route from the present 7% to 10% by 2020 will result in saving between Rs 20 to Rs 25 billion and therefore promotion of Coastal Shipping is the topmost priority of the Ministry of Shipping, said Minister of State for Road Transport & Highways, Shipping and Chemicals & Fertilizers, Mansukh Mandaviya while inaugurating the International Maritime Conference and Exhibition 2018, organized by Institute of Marine Engineers (India) in Mumbai recently.

Highlighting the Government’s ‘Sagarmala Programme,’ the Minister said that the main focus of Sagarmala is Port-Led Development, to reduce logistics cost and enhance last-mile connectivity. Under this programme, over 600 infrastructure projects with investment of approximate Rs. 8.78 lakh crore have been identified, out of which 89 projects worth Rs. 14000 Cr. have been completed and 436 projects worth Rs. 4.18 lakh crore are under various stages of implementation, he said, adding that after completion of these projects, logistics cost is expected to reduce by Rs. 30,000 – 40,000 crores while creating one crore jobs including 40 Lakh direct jobs.

Mandaviya said the Ministry is working on developing 14 Coastal Economic Zones (CEZs), which will provide huge employment opportunities in coastal areas and lead to Port-Led development of such regions where once operational, they will ensure employment opportunities and economic upliftment of people there.

To promote cruise tourism along Indian Coast, Government has revised Standard Operating Procedures (SOPs) to facilitate Cruise Tourism like e-visa facility at five Sea Ports (Mumbai, Goa, Mangalore, Cochin and Chennai), exemption of e-visa tourists from the requirement of biometric enrolments for a period of 3 years and reduction of Port Charges and construction of a new Cruise Terminals in 5 Major Ports in the country. As per estimates, this is likely to generate employment for 2.5 lakhs persons and generate revenue to the tune of 35,500 crores, he added.

Pointing out that the Government has amended the 147-year old Admiralty Act passed by the British, he said it will now be dealt in accordance with domestic Indian legislation, giving powers to High Courts of respective states. “With the proposed amendment in the existing Merchant Shipping Act, 1958, there would be huge change in the Indian Shipping / Maritime Sector and this would facilitate Indian citizens having more than 50% share of the vessels to register under Indian Flag,” the Minister said.

Speaking about the India – Bangladesh agreement for use of Chittagong and Mongla Ports for cross-border movement of goods, Mandaviya said that it would be a ‘game-changer’ for Eastern India by opening up new routes for cargo movements to Central Asia and Europe while also promoting co-operation between the two countries in respect of Economic, Social and Cultural Advancements. The development of Chabahar Port will provide a direct route to Afghanistan, while bypassing Pakistan, he said.

The Minister noted that significant initiatives of the Govt. of India in last four years witnessed a steep growth of 42.3% in the number of Indian Seafarers i.e. from 108,446 (2013) to 154,349 and that now India is providing 9.35% of the seafarers — while being ranked 3rd in the list of largest nations in the world – with plans to enhance this share to 15 – 16 % in the near future. The DG Shipping is taking many steps including development of an e-portal, online examination and assessment, rating system of MTIs and assigning responsibilities to RPSLs for enhancing the number of Seafarers.

Cochin Shipyard Limited (CSL) has emerged as front-runner in the shipbuilding and ship repair industry with a shipbuilding order book of over Rs 8000 cores. CSL has exported around 45 high tech ships to international clients worldwide and is constructing Indigenous Aircraft Carrier.

A new Dry Dock facility will be commissioned by June 2021 to tap the market potential of building and repairing specialized and technologically advanced large vessels such as LNG vessels, larger aircraft carriers, drill ships, and dry-dock repairs of semi-submersibles, jack-up rigs, etc.

Pointing out the huge scope for development of Ship Repairing Facilities in the country, the Minister said the potential ship repair market in India is estimated to be in the range of Rs. 2,600-2800 Crores, assuming that all Indian fleet will be repaired in India.

He said that the MoU between Cochin Shipyard and Mumbai Port Trust for operation, maintenance and development of ship-repair facility at Indira Dock would provide a professional ship repair ecosystem, that would be beneficial for the commercial as well as Defense Ship Repair Industry in India. Cochin Shipyard is in the process of development of Ship Repair Facility in joint venture with HDPEL on the Eastern Coast and with the Mumbai Port on West Coast in the country.

“In order to strengthen the shipbuilding industry, our Government has given infrastructure status to the ship yards to make them illegible for financial assistance at reasonable rates. The Government of India has introduced a Rs. 4000 crore Financial Assistance Policy (FAP) to shipyards for 10 years, for contracts secured between 01.04.2016 and 31.03.2026,” he added.

The world’s premier ship recycling facility is located at Alang Sosiya, in Gujarat, where nearly half of the world’s scrapped ships are recycled. To make ship recycling industry safe for its workers and the surrounding environment, a draft legislation to implement the Hong Kong Convention is now undergoing pre-legislative consultations; the Minister said while expressing confidence that the convention would be ratified in the not-so-distant future.

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