 "A crow flies past a container ship docked at a port in Vallarpadam in Kochi")
The recent move by Hyundai Motor India to transport cars through sea for the domestic market might have cheered many but not the company which shipped these cars.
Ro-Ro (roll on, roll off) in coastal shipping is still not viable, it says. “Ports may be harping about this coastal shipping service but we have incurred a loss of 60 percent from this (Chennai-Pipavav) voyage,” Kiran Kamat, managing director of Link Shipping & Management Systems, told this newspaper. “We are not at all encouraged to remain active in the ro-ro division of coastal shipping.
Currently, Link Shipping is the only company in the country with ro-ro vessels; it has two. Last week, it carried 800 Hyundai-made cars from Chennai to Pipavav port in Gujarat. Ro-ro ships are designed to carry wheeled cargo such as cars, trucks, semi-trailer trucks, trailers and railroad cars. These are driven on and off the ship on their own wheels.
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“The MV IDM Symex vessel has a capacity of 4,000 vehicles but carried only 800 cars. We had taken up this assignment since the shipping ministry had promised an incentive of Rs 3,000 per vehicle. But, no incentives have (yet) been given to us. Due to this, I could cover only 40 per cent of my cost. Why should I continue doing this business for the domestic market?” said Kamat.
Having burnt its fingures, Link Shipping has decided to withdraw its second ro-ro vessel, Maria India, from the domestic market for coastal shipping and deploy it on an export route. “We will be sending Maria India on the Mumbai-Rangoon route and are in talks with a domestic automobile maker for this,” said Kamat.
Officials in the coastal shipping industry say they're observing. “This is just one load in the ro-ro division. We are not sure if business in this segment is viable. If we do not consider help via incentives, then there at least should be a reverse leg project, which means a return cargo to cover the cost,” said a senior official with Shreyas Shipping & Logistics. “We need to wait-and-watch the developments in this segment.”
Coastal shipping officials hope the coming Union Budget will have incentives scheme for this segment. They also say the tardy procedures at major ports need to be resolved if business has to kick off in this segment.
“Procedures at major ports are not only cumbersome but there is also no uniformity across the major ports,” said Kamat. “For example, at the New Mangalore port, Link Shipping would have to provide a Bill of Coastal Goods (BCG) for every vehicle that went into the ro-ro vessel. However, the Hazira port authorities would accept a list of all vehicles and just a single BCG.”
Adding: “The incentives scheme is not supposed to be a subsidy. Upon the cargo shift from road to sea, the government will surely save on its fuel bill and part of these savings has to be diverted towards the coastal shipping incentive scheme of Rs 3,000 a vehicle.”
India has a coast line of 7,500 km but carries only about seven per cent of its total domestic cargo via sea. China and Japan carry 20 per cent and 42 per cent of theirs', respectively, via sea and with smaller coast lines.
