Coastal shipping players keen on extended subsidy

July 16, 2020 12:08 am | Updated 12:08 am IST - KOCHI

Even as a firm is set to resume ferrying of containers by ship along the Kochi-Beypore/Azheekode coastal shipping corridor in a fortnight, demand is rife that the tenure of the government incentive for such vessels be increased from six months to three years.

The other demands are to increase the depth of minor ports in Kerala to help them host bigger ships and to appoint a full-time chief executive officer (CEO) to speed up the decision-making process to attract huge ships to the State’s ports for sign on-sign off of crew. This process of disembarking and embarking of crew from a 2.20-lakh-tonne mother vessel commenced at Vizhinjam on Wednesday.

Earlier this month, a firm operating a ship with capacity to ferry up to 51 containers at a time had expressed willingness to resume operations in the Kochi-Beypore/Azheekode coastal-waterway, after over a year’s time span. This waterway transit of containers is expected to resume in the first week of August. The operator has demanded an extension of the tenure of incentive given for freight movement to catalyse movement of cargo from road to waterway. Another demand is that minor ports operate round the clock to lessen the turnaround time of ships.

“We withdrew our vessel Great Sea Vembanad in March 2019 after operating on the route for a year, after incurring loss to the tune of ₹2.50 crore. The vessel, which has an Indian Register of Shipping (IRS) certification, is idling now. Extending the incentive period to at least three years will encourage cargo transit through the waterway. This will in turn help fetch adequate number of laden-containers for the return trip as well. Our willingness to resume the service has been communicated to the Department of Ports [DoP] and the Kerala Maritime Board [KMB],” said Sonu George, CEO of the firm that owns the vessel.

A trader can save up to ₹2,000 if a container is ferried through the coastal-shipping corridor, as compared to transporting it through Kerala’s congested highways. This includes expenses for last-mile connectivity. The lessening of congestion, pollution, and accidents on narrow highways, whose maintenance needs a sizeable amount every year, is yet another advantage. There will thus be considerable reduction in carbon footprint — from 55 gm/km to 12 gm/km for every kg of cargo, if stakeholders shift from lorries to coastal vessels. On their part, the DoP and KMB must bring about common special operating procedures (SOPs) to enable faster turnaround at different ports, he added.

Meanwhile, KMB Chairman V.J. Mathew said the board would take a call based on the IRS certification of each vessel. “The extension of tenure of incentive, if any, must be effected by the government,” he added.

Making it competitive

Sources in the DoP said the six-month incentive scheme beginning from July 1 was rolled out to encourage firms to invest in coastal shipping vessels in order to make it competitive vis-a-vis lorry transport. “Operators can easily put a system in place during this time span and do marketing as well to ensure assured patronage. On their part, ship operators must ensure regular services and introduce ships that can withstand rough seas and wind, especially when the south-west monsoon lashes Kerala,” they added.

Ultimately, imposing curbs like fee on transporting containers by road and facilitating soft loans for procuring/manufacturing ships will go a long way in promoting transportation of cargo through Kerala’s coastal and inland waterways, the sources said.

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