Week ending June 14, 2003

News on Shipping

Ships to take detour as Suez is out of bounds :The London-based War Risk Rating Committee, which advises insurers, has suspended war rates for cargo in the Gulf ports and places East of longitude 56 10E, which implies that ships will have to now take a longer route around the Cape of Good Hope. The committee has advised the insurers to incorporate a 48-hour war risk cancellation clause and automatic termination of insurance clause as against the traditional seven-day notice for cancellations. Insurers have already informed the shipping lines that their coverage for wartime cargo losses in the Middle East will be cancelled within 48 hours of the conflict starting in Iraq. The notice is aimed at getting ships cleared from the war zone immediately.

Government engages TCS to study coastal shipping : The government in an effort to develop coastal shipping as an integral part of the multi-modal transport system in the country has assigned the Tata Consulting Services Ltd. to undertake a detailed study on the coastal shipping and minor ports. This is for the first time that the government has engaged an external consultant for undertaking the study. The study would identify cargo that can be diverted to coastal shipping from other modes of transport (road/rail) and evaluate future traffic potential for coastal movement in the next 10 years. Further, the study would also identify minor ports, either existing or yet to be established, for use by coastal shipping keeping in view rail/road connectivity and hinterland linkage and recommend the infrastructure needed to develop such ports.

GE Shipping inducts two new board members: The Great Eastern Shipping has recently inducted HDFC managing director Mr. Keki Mistry and AFL Ltd. chairman Mr. Cyrus Guzder on its board of directors.

News on Ports

Record single day handling set by Kandla Port : The Kandla port is all set to cross a record throughput of 40 million tonnes during the current fiscal 2002-03, having already touched 38.09 million tonnes as on March 11. With another 20 days to go, the port authorities are confident that the port would touch a level of 40 million tonnes. The performance of the port this fiscal year is a major improvement over the performance of the port last year, when it posted a throughput of 37.72 million tonnes. The likely performance in this fiscal year is set to surpass the target of 39 million tonnes the port has agreed to achieve as per the Memorandum of understanding it has signed with the ministry of shipping. The port recorded a handling of 3.26 lakh tonnes of cargo on March 11, which is a new national record for the highest single day handling by any major port.

Mumbai port box terminal attracts six bidders :The proposed offshore container terminal the global tender for which was floated by Mumbai Port Trust some time ago has attracted expression of interest (EOI) from six international port developers, including CSX Terminals Ltd, Evergreen Marine, P&O Ports and Dubai Ports Authority, L&T and Menang Amalgamated Sdn Bhd. The global tender for development of two terminal berths for container handling berths.

News on Dredging

Dredging companies await early decisions port projects : The dredging companies, both Indian and foreign are eagerly awaiting decisions on several dredging projects in the pipeline. The government has in its recent budget proposed major upgradation of Kochi and JNP port. The two other projects include proposed dredging for the Ennore port and the Sethusamudram project. A decision on the dredging work in the Hooghly river is also awaited off the Haldia Docks. Several smaller dredging projects, which are likely to materialize in the near future include the Mormugao and Sikka port projects. The Chennai Port has already floated the tenders for both the capital and maintenance dredging and the volume of work is expected to be about 1.8 million cubic metres to be executed in six months, costing about Rs.25 crore. Maharashtra Maritime Board (MMB) has also floated tenders for rock dredging at some of the minor ports in the state estimated to cost about Rs.25 crore and involving dredging about 2 lakh cubic metres. DCI is reportedly bidding for both the projects alongside several other international dredging companies.

News on Logistics

World bank to assist projects under National Rail Vikas Yojana:The Ministry of Railways is reportedly negotiating with the World bank for funding assistance for construction of projects being developed under the National Rail Vikas Yojana (NRVY) at a cost of Rs. 15,000 crore. The World Bank loan will supplement the Rs. 1,500 crore loan being provided by the Asian Development Bank (ADB) to NRVY, a scheme aimed at removing the capacity bottlenecks in various sections of the railway network over the next five years, including port connectivity projects. The Railway ministry has decided to provide a budgetary support of Rs.1500 crore for the NRVY schemes.

Transport operators plan nation-wide strike from April 14: All-India Motor Transport Congress (AIMTC) has given a nation-wide strike call from April 14 to press for their seven-point charter of demands. The AIMTC has demanded withdrawal of the additional 0.50 paise per litre cess on diesel and regulation of excise and customs duty to bring about stability in diesel prices and transparency in price fixation. The AIMTC has also urged the government to scrap the system of collecting tolls on highways when the government is collecting road tax and cess on petrol and diesel. The AIMTC has also demanded the amendment of the outdated Carriage of Goods Act 1865.