{"id":79830,"date":"2018-08-02T14:36:57","date_gmt":"2018-08-02T21:36:57","guid":{"rendered":"http:\/\/www.lankaweb.com\/news\/items\/?p=79830"},"modified":"2018-08-02T14:36:57","modified_gmt":"2018-08-02T21:36:57","slug":"colombo-cuts-rates-after-india-eases-cabotage-rules","status":"publish","type":"post","link":"https:\/\/www.lankaweb.com\/news\/items\/2018\/08\/02\/colombo-cuts-rates-after-india-eases-cabotage-rules\/","title":{"rendered":"Colombo cuts rates after India eases cabotage rules"},"content":{"rendered":"

P MANOJ\u00a0Courtesy The Hindu Business Line<\/a><\/em><\/span><\/h2>\n
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MUMBAI, AUGUST 2<\/p>\n<\/div>\n

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Colombo port, which thrives on Indian cargo containers that passes through it, has cut transshipment rates by 9.5 per cent after India lifted cabotage restrictions in May, allowing foreign ships to operate on local routes to reduce the country\u2019s dependence on the neighbouring hub to transport cargo.<\/p>\n

The island nation, one of the major container transshipment hubs in the region along with Singapore, Port Klang and Jebel Ali, is taking the fight for containers to the Indian shores.<\/p>\n

Transshipping containers through Colombo entails extra time and costs, hurting India\u2019s competitiveness in the global market.<\/p>\n

\"\"<\/p>\n

Transshipment fight hotting up<\/h3>\n

Lankan discount<\/p>\n

After India relaxed cabotage, Colombo reduced the transshipment tariffs by offering a discount of 9.5 per cent,\u201d said Deepak Tiwari, Chairman of the Container Shipping Lines Association (CSLA), adding that shipping lines were not in love with Colombo.\u201d<\/p>\n

Individual terminals must be offering volume-based rebates to shipping lines as part of their agreement, but on the general published rates, no revision was done recently. Customers bringing incremental volumes are offered volume discounts by terminals,\u201d Upul Jayatissa, Chief Manager (Marketing and Business Development), Sri Lanka Ports Authority, told\u00a0BusinessLine<\/em>\u00a0over phone from Colombo.<\/p>\n

Jayatissa reckons that India\u2019s decision to relax cabotage will have an impact on Colombo traffic. But, it will depend on the shipping lines; they are the ones who decide the routing of services. They have to decide what they really want to do. So far, we have not felt any impact on our transshipment business, but I don\u2019t know what will happen in the future,\u201d he said.<\/p>\n

The transshipment volumes of Colombo, according to Jayatissa, have grown by 20 per cent in the first half of 2018 calendar year compared to last year. Colombo port handled 4.8 million twenty-foot equivalent units (TEUs) in 2017 from four terminals. Of this, about 45 per cent was India-bound or originating containers, underlining Colombo\u2019s dependence on Indian cargo for its sustenance.<\/p>\n

Marine charges<\/p>\n

The vessel-related charges or marine charges at Indian ports are four times more than in Colombo, said VK Singh, Managing Director, Shreyas Shipping & Logistics Ltd.<\/p>\n

For instance, the marine charges for a 24-hour stay for a 5,000-TEU capacity ship is about $40,000 in India and $10,000 in Colombo. This is a big attraction for the lines. That\u2019s why they don\u2019t want to stop calling Colombo,\u201d said Suresh Amirapu, CEO, Bharat Mumbai Container Terminals Pvt Ltd, a unit of Singapore\u2019s PSA International Pte Ltd.<\/p>\n

The marine charges are low in Colombo because the Sri Lankan government funds basic infrastructure, including dredging, unlike in India.<\/p>\n

The networking is already established in Colombo,\u201d said Jibu Kurien Itty, CEO, India Gateway Terminal Pvt Ltd, the transshipment terminal-run by DP World at Vallarpadam in Cochin Port Trust. So, when you are looking to divert containers away from Colombo, you have to be actually two steps ahead in the game,\u201d he said, stressing the need to rationalise marine charges in India.\u201d<\/p>\n

When you are competing with Colombo, you have to play to your strengths. India has the cargo; that\u2019s what Colombo does not have,\u201d Jibu added.<\/p>\n<\/div>\n<\/div>\n<\/section>\n","protected":false},"excerpt":{"rendered":"

P MANOJ\u00a0Courtesy The Hindu Business Line MUMBAI, AUGUST 2 Colombo port, which thrives on Indian cargo containers that passes through it, has cut transshipment rates by 9.5 per cent after India lifted cabotage restrictions in May, allowing foreign ships to operate on local routes to reduce the country\u2019s dependence on the neighbouring hub to transport […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[],"class_list":["post-79830","post","type-post","status-publish","format-standard","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/79830","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/comments?post=79830"}],"version-history":[{"count":0,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/79830\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/media?parent=79830"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/categories?post=79830"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/tags?post=79830"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}