Capt Achanta Sivakumar: In order to improve the cost of logistics, in my view, following
measures would help:
volume of cargo moving on road, and switch to rail or coastal shipping.
road haulage costs significantly, by offering tax breaks, waiver of tolls etc.
coastal shipping, cheaper by offering significant waivers on port dues, easing
up on regulatory restrictions etc, tax breaks etc.
domestic manufacturing facilities for container handling equipment and reduce
cost of container handling during each custody change.
government or private owned facility service provider must get rid of the
cost-plus mindset when fixing tariffs for various activities, including
rail/road haulage, port dues, container handling etc and work towards building
reliable and competitive services.
SS: Sethusamudram Ship Canal project remains stuck for the past 12
years after the shipping ministry had invested Rs one thousand crores. The
project has proceeded half way and got stuck.
What are the steps that need to be taken to revive the project? How will
this project help promote development of industries in South Tamil Nadu, as
claimed by the proponents of the project? Or should it be taken up as a
strategic project as Hambantota Port has fallen into the hands of China?
CAS: The SS SHIP CANAL PROJECT in my view was a total waste of public
resources as the intended traffic volume and perceived savings on fuel, would
have never justified the cost for the project. There was actually no need for
SS Canal project considering the traffic pattern and volumes.
SS: Coastal shipping has not taken off in India despite several
concessions offered by the Shipping Ministry. Can you identify the obstacles
and how they can be overcome? Coastal
shipping of a unitized cargo like automobiles could not succeed and had to be
given up at Chennai port recently.
(Coastal shipping: representational image)
CAS: Few things will help improve coastal shipping:
terminals or ports to be earmarked for handling domestic cargo
as close to manufacturing hubs, to reduce landside costs
and taxes to be reduced to a minimum
and egress of vessels and the cargo to be permitted.
the fuel cost for ship fuels and lubricants
sops by way of tax breaks for seafarers sailing on coastal ships. Ease the
certification process for officers sailing on coastal ships.
separate pool of coastal officers and ratings, for manning the coastal ships.
The list is
rather long - but above are few quick and easily implementable measures.
SS: Owner of a container terminal was quoted as
saying recently that India needs more cargo, better connectivity to ports
rather than creating more Greenfield ports. World over container traffic is
picking up. The trend is not visible in India except in select west coast
ports? What could be the reasons for the low container traffic in Indian ports
and how this trend could be reversed?
CAS: This trend can be reversed
only through better thought out manufacturing hubs in SEZ's.
SEZ's should be foreign territory in every sense of taxation and
administration, and be located in large parcels of land, closest to ports.
Make in India initiative will work only when SEZ's are created with
proper framework of regulations, which will permit them to succeed.
SS: Three decades ago Shipping Corporation of India conceived a
project of aggregation of cargo for the entire East Coast at Tuticorin Port so
that main line vessels could pick up or drop cargo for east coast ports but the
proposal did not take off. Vallarpadam Transship terminal has been failure
despite several concessions offered by the shipping ministry. What are the
lessons to be learnt of the failure of Vallarpadam for the proposed
transshipment terminals at Vizhinjamand Colachel?. Can the facility being
created near the tip of south India compete with Colombo and Singapore ports, leaders
in transshipment traffic?.
CAS: The terminal operators and their landlords (port trusts) should
be able to assess the per unit cost of handling a
container at their terminal vis-à-vis Colombo, SIN etc.
While assessing above, they must factor their own geographical
location( and inherent disadvantages, such as cost of deviation from main
routes etc.), in addition to handling efficiency, marine charges etc. The stand
taken should be holistic and long term, and not piece meal as being done now.
(To be Continued)