Government has further eased the conditions for foreign flagged ships to carry fertiliser
cargo along the coast by modifying the cabotage relaxation announced in June.
the amendments issued on September 10, the minimum movement of fertiliser to
the extent of 50 per cent of the total cargo onboard a (foreign-flagged) ship
is applicable only for cargo loaded at any lndian Port for Coastal Movement,
that is, at least 50 per cent of the total coastal cargo on board should be
fertilizer and rest of the Coastal cargo can be any other cargo. Besides, the
movement of fertilizer on a foreign flagged ship can be in either bulk, break
bulk or containerised form.
To cite an
example, the Shipping Ministry said that if a foreign flag ship carrying 50,000
tonnes of export-import material unloads 20,000 tonnes at Deendayal Port Trust,
then the vessel can load any quantity of fertilizer for coastal movement in the
empty space, from Deendayal Port to any other Port of lndia.
any cargo other than fertilizer is also loaded at Deendayal Port Trust, then
the quantity of fertilizer has to be at least 50 per cent of the total coastal
cargo loaded at Deendayal Port Trust. lf any Export Import cargo is loaded at
the same port, it would have no linkage with the carriage of fertilizer- the
restriction of 50 per cent is only on coastal cargo loaded from that particular
Further, if a
foreign flag ship is chartered by an lndian firm, the ship can load any
quantity of fertilizer for Coastal movement. But, if any coastal cargo other
than fertilizer is also loaded, then the quantity of fertilizer has to be at
least 50 per cent of the total cargo loaded on board for coastal trade, PK
Sharma, an Under-Secretary in the Shipping Ministry, wrote in the September 10
The June 22
order allowing foreign ships to carry fertiliser along the coast was
conditional on the commodity contributing to at least 50 per cent of the total
cargo on board the ship. Fertiliser firms and shipping companies had sought
clarification from the Ministry on the order.
Government will soon resolve the policy logjam on paying freight to incentivise
and ease movement of fertiliser along the coast, Shipping Secretary Gopal
Krishna said on 10 August.
Fertiliser Ministry currently reimburses freight on the basis of railway
receipts only. Hence, there is gno incentiveh for a company or a ship owner to
suggested to the Fertiliser Ministry not to see any bills. You just allow the
shipping company or the fertiliser company to move the cargo and whatever is
the rail freight, you just pay them blindly. This way, they will have the
incentive to bring down costs and move cargo,h Gopal Krishna said.
this point, he said if the rail freight is Rs 100 and if actually by Coastal
Shipping, the freight comes to Rs 90, then they will move by coast and pocket
at least Rs 10. Then, the Government will not have to pay more and at the same
time we are incentivising fertiliser movement. Thatfs how we have approached
the issue,h the Shipping Secretary said.
By the end of
the year, at least 3 mt of fertiliser will move by Coastal Shipping, he added.