THERE is no clear evidence so far that
India's new, liberalised cabotage regime has translated into broader
demand for transshipment handling at major domestic ports, although,
some terminals have experienced growth.
After cabotage relaxation was introduced
on May 21, foreign-flag carriers became free to transport laden
export-import containers for transshipment and empty containers for
repositioning between Indian ports without any specific permission or
license.
The general consensus among industry leaders is that the reform is in
its early stages and that the full significance of greater competition
in an unrestricted market can only be assessed over a longer period.
Further, a new IHS Media market analysis signals a transshipment uptrend at Krishnapatnam port which handles a sizeable share of that trade to/from south India.
According to the study, Krishnapatnam increased its transhipment
handling during July to 18,426 TEU, from 12,283 TEU the previous month.
As a result, its total volume last month reached 43,474 TEU, after
hovering between 35,000 TEU and 37,000 TEU in the April-to-June period.
If that growth pace is sustained in the coming months, it would place
the Krishnapatnam Port Container Terminal (KPCT) on a stronger footing
regarding transhipment freight to/from south India due to its
sophisticated infrastructure - which has been further boosted with last
month's addition of five electrically powered, rubber-tire gantry cranes
- and flexible/competitive pricing.
APM Terminals' Gateway Terminals India at Jawaharlal Nehru Port Trust is another terminal operator that was able to attract more
transshipment cargo last month. Statistics show APM Terminals Mumbai
handled 1,175 TEU of that traffic, compared with 738 TEU in June.
However, DP World's International Container Transhipment Terminal (ICTT) at Cochin port has yet to generate noticeable, incremental gains
from the cabotage change, although volume there marginally improved to
1,545 TEU in July, up from 1,205 TEU in June.
The Dubai-based company agrees the new cabotage policy is a welcome step
and will be a boon for the development of coastal shipping in the
country but it continues to highlight the fact that high vessel-related
charges at Indian ports, including Cochin, remain a stumbling block for
shipping lines seeking to deploy large vessels on trades to/from the
emerging market economy.
"To attract the next generation deep draft vessels additional steps need
to be taken, such as competitive marine charges as other hubs like
Colombo [Sri Lanka] enjoy pricing flexibility and offer more competitive
rates compared to Indian ports," said an official.
"Along with this, a move towards a market determined tariff, investment
in state-of-the-art technology and maintaining deeper drafts are among
other measures that will boost the sector to make it more attractive and
support India's trade growth."
At the same time, officials at the Ministry of Shipping claim that the benefits of that policy shift have started to trickle
down through the supply chain ecosystem, as Indian ports were able to
recapture some portion of the domestic cargo - estimated at 11,589 TEU -
in June, which shippers would otherwise have had to transship over
foreign hub ports, such as Colombo, Singapore and Port Klang.
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