Week ending December 07, 2002


News on Shipping

INSA seeks tonnage tax system for shipping industry A delegation of shipping industry leaders from Indian National Shipowners Association (INSA) met the Mr. C.S. Rao, Secretary (Revenue) in the Finance Ministry to appraise him of the benefits that would accrue to Indian shipping and other ancillary sectors, if a tonnage tax was introduced for the shipping industry by the Government. The government has reportedly so far taken a favorable view on the issue, though the Finance Ministry is worried about the revenue implications of switching over to a new tonnage tax regime. The Finance ministry is weighing its options on how much additional tonnage the new tax system would generate in the country. The INSA delegation was led by Mr. P.K. Srivastava, its President and CMD of SCI and included other industry leaders like Mr. Bharat Sheth, Managing Director, Great Eastern Shipping Company Ltd, Mr. Yudhishthir Khatau, Managing Director, Varun Shipping Company Ltd, besides Mr. M. Ramachandran, Joint Secretary from the Ministry of Shipping.

Eastern India Shippers Association plea on new US Customs rules The Eastern India Shippers Association (EISA) has made a representation to the Union Commerce Ministry about the difficulties the shippers are likely to face, in the wake of enforcement of the US Customs Service's 24-hour Advance Manifest Filing Rule. In its memorandum, the EISA has expressed concern over practicability of the compliance with the new rules and regulations in the context of present conditions of the Indian ports and the practices prevalent there. The Association has pointed out that many shippers apprehend that they might find it difficult to stick to the shipping schedules under the proposed rule. The US Customs Service's 24-hour Advance Manifest Filing Rule, which is an integral part of the US Customs' Trade Partnership Against Terrorism (C-TPAT), comes into effect from December 2, followed by a 60-day transition period.

UN intervention sought to curb sub-standard shipping After the recent oil tanker -"Prestige" stuck disaster off the Spanish coast, several international environmental and labour groups have sought UN intervention to curb what they have called "sub-standard shipping". The organizations that have jointly authored the letter to UN Secretary General Mr. Kofi Anan, include Greenpeace International, the World Wildlife Fund (WWF) and the International Transport Workers Federation (ITWF), The three groups have alleged that there is a "web of secrecy" that which allows sub-standard shipping to flourish. The three groups have called for a new global agreement to eliminate the flags of convenience (FOC) system and ensure that flag states meet their responsibilities as specified under international law and held accountable for any violations.

European Union comes out with blacklist of ships The European Commission (EC) has published a blacklist of ships, which have not complied with the maritime safety rules. The action follows the sinking of tanker vessel Prestige off the Spanish coast. The EC has drawn up a list of 66 ships, which had regularly failed to comply with maritime safety rules. It also said that it proposes to ban the transport of heavy fuel oil in single-hull tankers.

India to initiate talks with Sri Lanka on launching ferry service The government is soon expected to start negotiations with the Sri Lankan government on the proposal for revival of ferry service between the two countries, that will link Rameshwaram and Talaimanar. The ferry service between the two countries was discontinued in the early seventies. The government had earlier signed an memorandum of understanding (MoU).

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News on Ports

KoPT slashes container handling charges Kolkata Port Trust has slashed the container handling rates for ICDs in an effort to increase container traffic through. Containers moved by wagons and by road to the Kolkata Dock System (KDS) have been reduced from Rs 5,198 to Rs 2,079 per TEU. Following rationalization, there is now one uniform flat rate of Rs. 2,079 per TEU, whether moved by rail or road. The revised rates are applicable to all containers to and from any ICD in the country, except the ICD Cossipore, which is within Kolkata city limits. Following the price slash, the KDS is the cheapest container handling port in the country, even cheaper than the Haldia dock.

Government is ready with draft SEZ Act The Ministry of Commerce has finalized the draft of the Special Economic Zone Act to be promulgated for providing a comprehensive package to boost exports. The incentives proposed in the package include exemption from the mandatory provisions of the insurance, banking and Sick Industry Acts. The draft bill also contains provisions to treat units located in the zones as "units located in the foreign territory" in so far as import, export and foreign exchange provisions are concerned. The draft bill is being currently circulated to all departments and ministries, following which it will be finally referred to the Union Cabinet for approval, before being tabled before the Parliament for enactment.

Seafood exports from Cochin port go up Seafood exports through Cochin port have continued to grow and as per the data furnished by Cochin Chamber of Commerce and Industry, the export volumes have stood at 14,050 tonnes during October as against 10,412 tonnes in the previous month. The export of cashew has also gone up in October to 6,059 tonnes against 5,227 tonnes in September. Only tea and coir exports through the port have seen a decline during October. Tea exports have declined from 12,679 tonnes in September to 10,349 tonnes in October, while coir exports came down from 5002 tonnes to 440 tonnes in the same period.

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News on Shipyards

Cochin Shipyard privatization opposed The National Confederation of Officers' Associations of Central Public Sector Undertakings (NCOA) has demanded that the government should focus its efforts on reviving the Indian shipyards instead of trying to make distress sale. In the face of global recession, the government, instead of supporting and saving the shipyards, was planning to liquidate the shipbuilding industry Mr. K. Ashok Rao, Secretary-General of NCOA has charged. The disinvestment of profit-making yards, in the face of global recession is "counter-productive" and "anti-national" Mr. Rao has charged. Most of the domestic yards are hard-pressed for orders, even though the country's share in the global shipbuilding market accounts for 90,000 tonnes of a total of about 50 million gross tonnage. Meanwhile, Cochin Shipyard's Joint Action Council Against Privatization has sought the intervention of the Kerala government against the decision of the Disinvestment Commission to privatize Cochin Shipyard Ltd.

News on Logistics

AMTOI meet to appraise on implications of new US Customs rules The Association of Multimodal Transport Operators of India (AMTOI) organized a trade meet in Mumbai to discuss the new US Customs Security Regulations, to be enforced in the wake of the passage of the US Terrorism Act, currently before both the House of Representatives and the Senate and to be shortly signed by the US President. The proposed anti-terrorism law once passed could pose severe liabilities on the shipowners and escalate insurance cover to possibly over $ 200 million, Mr. S.S.Rangnekar, President of AMTOI told members. The new regulations are expected to be effective from December 2,2002. However in order to give ocean carriers time to develop and implement new processes, the penalties under the law would be made effective only from February 2003.

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