CARGOCONNECT-MARCH2024 - Flipbook - Page 15
nine coastal states, and 1,382 islands, India’s
shipping industry plays a pivotal role in
the country’s trade. Nearly 95% of India’s
trading by volume and 70% by value relies
on maritime transport. Despite this, India’s
major ports require signi昀椀cant expansion
and modernisation to handle larger vessels
and increasing cargo volumes. Similarly,
Indian 昀氀eet’s global share remains at around
1%, while China accounts for 5%, and
Singapore accounts for 6.5% in global
tonnage.
Reportedly, the government has allowed
foreign direct investment (FDI) of up to
100% under the automatic route for port
and harbour construction and maintenance
projects. In the Union Budget 2023-24, the
total allocation for the ministry of shipping
stood at US$1,813.16 million.
Recognising that Indian-昀氀ag shipping
tonnage has not kept pace with the country’s
trade needs, the government is already
considering nine policy interventions. These
include tax-related changes and streamlining
vessel registration processes. The government is also contemplating revisiting the
applicability of TDS (tax deducted at source)
on wages paid to Indian seafarers, allowing
Input Tax Credit on fuel and spares procured
for vessels, and more. The Maritime Vision
2047 report also recommends exempting
Indian ships from GST on reverse charge
for maintenance services consumed outside
India and granting infrastructure status
to the shipping industry.
In August 2023, the proposed `76,220
crore container port at Vadhavan – India’s
long-awaited mega deep-water port project
– cleared a big hurdle, with the Maharashtra Coastal Zone Management Authority
(MCZMA) recommending coastal clearance
for the project.
Vadhavan has been conceived and
designed as a satellite facility to Nhava Sheva
Port (JNPA), some 120 miles north of Nhava
Sheva, as the latter had become saturated
with little room for further capacity additions. The potential of Vadhavan stems from
two factors: the site has a deep natural depth
of 20 metres that can accommodate vessels
of up to 25,000 TEU capacity and its access
to a large hinterland market. Vadhavan
Port is expected to provide a capacity of
15 million TEUs in Phase I, going up to 24
million TEUs when fully built-out.
India, the largest country in the Indian
Ocean, currently has no deep-water terminal that can berth ultra-large container
ships (ULCVs) larger than 18,000 TEU.
Signi昀椀cantly, deep-sea ports are pivotal in
driving economic growth and facilitating
international trade for a nation. These ports
can accommodate large vessels and handle
substantial cargo volumes, making them
crucial gateways for imports and exports. By
providing e昀케cient access to global markets,
deep-sea ports stimulate industrial activity,
attract foreign investment, and generate
employment opportunities in maritimerelated sectors such as shipping, logistics,
and manufacturing.
Additionally, deep-sea ports serve as
vital hubs for transhipment, enabling seamless transfer of goods between di昀昀erent
modes of transportation and facilitating
smooth supply chain operations. They
also contribute to regional development
by promoting trade and investment in
coastal areas, fostering infrastructure
development, and supporting the growth
of ancillary industries.
The government has understood that
until and unless it invests in the country’s
maritime infrastructure, it will be unable
to attract direct port calls to its shores,
and will be vulnerable to geopolitical risks
emerging from the Chinese investments
in Colombo’s Hambantota mega-port and
Pakistan’s Gwadar mega-port. Therefore, the
unveiling of India’s plans for six mega ports
under the Amrit Kaal Vision 2047 marks
a significant milestone in the country’s
maritime ambitions. By leveraging the
potential of deep-sea ports, India aims to
strengthen its maritime infrastructure,
enhance trade connectivity, and propel
economic growth in the years to come.
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