India's cabotage rule eases to boost Vallarpadam CT

COASTAL shipping regulations governing the Vallarpadam Container Terminal in Kerala state are expected to be relaxed to lure transshipment cargo from Colombo in Sri Lanka.

India's Shipping Ministry is believed to be finalising details for the plan, and a cabinet note on the proposal will be prepared soon, according to a government official cited in a report by The Hindu Business Line.

The relaxation will allow foreign shipping lines to carry cargo between Vallarpadam and other Indian ports, it said, despite opposition from domestic carriers as it would lead to the opening up of India's coastal waters to foreign flagged vessels.

The cabotage provision under the Merchant Shipping Act restricts foreign flag ships from operating between two Indian ports with a view to protecting the interests of national flag carriers and developing coastal shipping.

According to sources, Vallarpadam may initially be given the relaxation for one or two years as was the case with Jawaharlal Nehru Port near Mumbai in the past.

In a related development, the US$500 million international container transhipment terminal at Vallarpadam, off Kochi Port, that is being developed by a joint venture, the India Gateway Company, is expected to be commissioned by next month or early September.

The terminal will have an annual container handling capacity of 1.2 million TEU annually in the first phase and three million TEU when fully completed.

The joint venture is 76 per cent owned by DP World, Dubai. Other equity holders are Container Corporation of India with 15 per cent, the Kochi-based Chakiat group with five per cent, and the Mumbai-based Transworld group with four per cent.

It will be DP World's fifth terminal in India, after Nhava Sheva, (JN Port), Chennai, Mundra and Vizag, the report said.
(Source:www.schednet.com)