The company expects that the Indian government will soon take a decision on the relaxation of the cabotage policy, given its huge investment in the Vallarpadam port project.

A relaxation in the cabotage policy to improve trade volumes at the
planned Vallarpadam port and other major ports in India is being
considered. Company officials from DP World are hopeful about such
relaxation soon.

Dubai-based DP World, one of the largest marine terminal operators in
the world with 49 terminals, is the private operator set to run the
terminal at Vallarpadam in Cochin port in India. The port is being
developed as a trans-shipment hub on a public-private partnership
model. The project involves a total investment of Rs2,200 crore, with
an investment of Rs1,000 crore by the Indian government and Rs1,200
crore by DP World.

The trans-shipment hub is being built in phases and the first phase is
expected to be commissioned by June 2010. On being questioned whether
contracts with various clients for using this port have been finalised,
Anil Singh, senior vice president and managing director for the
subcontinent at DP World Pvt Ltd, said, “We are just waiting for the
Indian government to relax the cabotage issues. We will sign the
contracts after that (the relaxation of the cabotage policy).”

“Their proposal is under consideration. We will have to verify their
projections. We need to see what lies in favour of the overall economy.
When the issue is under consideration, it is a little difficult to
opine. They (DP World) are talking of business that will be added to
the existent business available in Indian shipping. Their projection is
that it is a win-win opportunity, as it will bring (in) added business.
Now, we need to discuss it with the remaining stakeholders. The only
problem will arise when people object on the differences in the share
of added business that each one will get. I hope we will be able to
convince them (stakeholders) that it is an overall win-win situation,”
said Dr Satish Balram Agnihotri, joint director general, department of
shipping.

For the port to be commissioned in 2010, such relaxations in the policy
will have to be worked on soon. “We are very hopeful (that the
relaxation will happen before the commissioning date), because it
involves a huge investment from the government,” said Mr Singh. “We
should be able to decide on it before June 2010,” added Dr Agnihotri.

DP World officials claim that the new transhipment hub will help
attract around a million tonnes of cargo towards India. “This will help
bring back India’s cargo from ports like Colombo and Jebel Ali,” said
Mr Singh in a presentation made at a Confederation of Indian Industry
conference on costal shipping.

Cabotage is the transport of goods between two points in the same
country. At present, the cabotage policy in India allows first
preference to Indian flagships over cargo. Foreign ships are allowed to
carry this cargo only when no suitable Indian flag vessel is available
for the same.

Relaxation in the cabotage policy is expected to bring more trade to
Vallarpadam and other major ports in India. However, PTI news reports
on the cabotage policy suggested that barring of foreign ships on the
Indian coast for security reasons is being considered.

Source: Money Life

Search to find what you want

• India: No foreign vessels for coastal shipping

    Foreign flag ships and foreign-owned vessels may soon be barred from doing coastal trade along the Indian peninsula. The ministry of shipping is considering a policy proposal that will bring this into effect during the next one year over growing security concerns on the country’s coastline and the need to

• Nigerian Cabotage: Banks under pressure on ship owners ship acquisition loans

    Banks have began to pressurize indigenous shipowners to repay loans collected to acquire ship in anticipation of increased patronage under the Cabotage law regime. Following the passage of the Cabotage Law, indigenous shipowners under the aegis of Indigenous Shipowners Association of Nigeria (ISAN) collected  loans from banks to acquire more ships. This was

• Nigeria: Govt Agencies ports cause traffic jams \ u0026quot;

    We are more involved in the business of Tanker than in the business of container. I might not know much on the issue of clearing and the duration it takes in the port. Though we import some goods in containers, these goods take a very long time to clear. What

• Kochi port to check prices before the start box terminal

    As the deadline of scheduled commissioning of the Vallarpadam ICTT (international container transhipment terminal) by June is getting closer, the Kochi port is considering a review of various charges levied by it to create a level-playing field for developing the terminal as a transshipment hub. DP World, which is operating

• INDIA Foreign vessels can be excluded from the coastal trade

    A move is afoot to bar foreign vessels from coastal trade on the domestic waters amid growing security concerns over coastline security.

• Philippines: u0026quot

    Lifting the country’s Cabotage Law, which gives local shipping operators the exclusive rights to ply Philippine waters, could spell disaster to the already distressed shipping industry of the country, the government warns. Thompson Lantion, undersecretary for maritime affairs of the Department of Transportation and Communications (DOTC), said the country may end up like

• Ship Chartering: ONGC against new policy

    Flagship explorer Oil and Natural Gas Corporation has protested against a directorate general of Shipping circular which gives owners of Indian-flag vessels the first right of refusal in tenders for chartering ships, and said the policy has led to cartelisation among domestic shipowners. The DG-Shipping circular, issued in November, says

• FG bans foreign oil vessels

    CONCERNED that majority of the vessels providing marine services to International Oil and Gas Companies (IOCs) in their upstream and downstream operations are neither registered with NIMASA nor compliant with requirements under the Cabotage Act, the nation’s maritime regulator, NIMASA has come out with a raft of new measures to

• Foreign shipowners to neighboring states to beat cabotage

     As a means of subverting the Cabotage Act meant to protect the nation’s coastal trade, foreign shipowners bringing in petroleum products into the country have resorted to anchoring outside the country’s waters to prevent enforcement of the law. Disclosing this to Vanguard in an exclusive interview, Chairman of Indigenous Shipowners Association of

• Box shipping vessels slowly add, expand service rotations

    Signs are emerging of carriers adding vessels and port calls in response to capacity constraints as world trade picks up again following a period of idle shipping and service cutbacks. The most notable being Maersk Line, the world’s biggest, which is revising port rotation of its US east coast-Central America

• Obama port security policy, stoking anger / Australian LNG industry in the skills of burglary / China-India port developments have worried … / … But India is planning a comeback

    In today’s PTI Media Watch: Arguments over Obama’s port security policy rage in the U.S., Australia’s LNG industry faces a lack of skilled workers, China outpaces its nearest competitor India in port development – but, for India, it’s not over yet. Read at Obama’s port security policy stirs up trouble /

• India: Ministry is considering , monopolies in the port sector

    The Union Shipping Ministry plans to formulate a ‘Policy Guideline’ to prevent private sector monopoly in the port sector. Port users have welcomed this, but private terminal operators feel it was not necessary when things are going well at major ports with regard to public-private-partnership (PPP) projects. A recent draft

• Port of Long Beach is celebrating five years Environmental Leadership

    The Port of Long Beach has announced it is celebrating five successful years of the Green Port Policy and environmental leadership this month. “In the five years since the policy’s guiding principles were set down, the Port and its partners have amassed an impressive record of environmental accomplishments expected to

• Indian waters no turn-ply zone for single-hull tankers after 2010

    In a bid to prevent old and unsafe single-hull tankers from sailing Indian waters, the Government has decided not to extend the special exemption granted to the existing Indian flag tankers, to ships registered after December 31, 2009.

• DP World crisis may hit India plan

    Dubai-based port operator DP World, which had planned to invest $12 bn in Indian container terminal industry, may struggle to do so because of the travails of its parent, Dubai World, the heavily indebted holding company of the Dubai government. Although Dubai World has said its debt restructuring process does