Govt frees ships from transshipment permits for Indian entities: Nitin Gadkari

The government has done away with licensing requirement for ships chartered by Indian citizens or companies for transshipment of containers with a view to boosting coastal trade and promoting entrepreneurship, Union Minister Nitin Gadkari said on Thursday.

The move is aimed at arresting diversion of Indian container cargo to transshipment hubs at foreign ports that has swelled to 33 per cent besides creating employment.

The government has done away with licensing requirement for ships chartered by citizens of India or a company incorporated in India or a cooperative society registered in India for transportation of EXIM containers for transshipment purposes, Gadkari, who holds the portfolio of shipping, road, transport and highways, told PTI.

"The move will not only arrest diversion of Indian container cargo to foreign ports but will prove a milestone in creating entrepreneurship in shipping operations while unfurling huge opportunities for citizens including former army and navy personnel with desired silks and knowledge to charter smaller feeder vessels and participate in the fast growing container trade," Gadkari said.

This will not only result in ease of doing business but would create huge employment, the minister said.

At present transhipment hubs at Singapore, Malaysia, Colombo and Jabelali near Indian coastline gets about 33 per cent of the Indian container cargo which is aggregated there before shipped to final destinations.

"Transshipment of Indian cargo at foreign transshipment ports leads to traffic growth there and job creation in other countries, loss of revenue from Indian shippers in terms of port and logistic charges and loss of foreign exchange to foreign ports as the transhipment revenues and charges are collected from Indian exporters/importers by foreign ports," the minister said.

If aggregation is done at Indian ports, jobs will be created, port charges will come and an ecosystem will be developed, he added.

"Promoting transhipment in India would lead to cargo growth at Indian ports emanating not only from India but also potentially other countries in the region, which in turn would lead to creation of jobs in India, growth of accompanying ecosystem, revenue growth for Indian ports and retention of foreign exchange," he said.

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Shipping Secretary Gopal Krishna told PTI that this is one of the biggest measures in the shipping sector since 1958 and the move will in the first year, as per conservative approach, will result in at least 10 per cent reduction of the Indian container cargo transshipment to foreign ports.

Ports like Vishakhapatnam, Kandla, Cochin, Tuticorin, Ennore and Chennai are likely to benefit most initially, he said.

He added that Indian ports are likely to get an additional income to the tune of about Rs 200 crore on account of this.

The licensing requirement has been done away by the government in exercise of the powers conferred under section 406 of the Merchant Shipping Act, 1958.