The government is likely to relax the cabotage, or coastal shipping, regulations for Vallarpadam Container Terminal in Kerala to enable it attract the Indian transhipment cargo that is now getting diverted to the Colombo port, reported The Hindu.
The Shipping Ministry is understood to have taken in principle a decision on this and the final details are being worked out. A government official said that a Cabinet note on the proposal will be prepared soon.
The cabotage relaxation will allow foreign shipping lines to carry cargo between Vallarpadam and other Indian ports. This special privilege is expected to help the port to ensure faster pooling of cargo and their delivery.
The move assumes significance as Indian shipping lines have been vehemently opposing relaxation of cabotage for Vallarpadam on the ground that it would lead to opening up of Indian coastal waters to foreign flag vessels.
The cabotage provision under the Merchant Shipping Act restricts foreign flag ships from operating between two Indian ports. This is aimed at protecting the interest of national flag carriers and development of coastal shipping.
According to sources, initially, Vallarpadam could be given the relaxation for a year or two as was done in the case of Jawaharlal Nehru port in the past.
The International container transhipment terminal at Vallarpadam, off Kochi Port, is being developed by a joint venture — India Gateway Company that is 76 per cent owned by DP World, Dubai. Other equity holders in the company are Container Corporation of India (15 per cent), Kochi-based Chakiat group (five per cent) and the Mumbai-based Transworld group (four per cent).
The terminal being set up at a cost of US$500 million is expected to be commissioned by next month or in early September.
It will have the capacity to handle 1.2 million TEUs annually in the first phase and three million TEUs on full completion of the project.
This would be DP World's fifth terminal in India. Others include Nhava Sheva,(JN Port), Chennai, Mundra and Vizag.
The Shipping Ministry is understood to have taken in principle a decision on this and the final details are being worked out. A government official said that a Cabinet note on the proposal will be prepared soon.
The cabotage relaxation will allow foreign shipping lines to carry cargo between Vallarpadam and other Indian ports. This special privilege is expected to help the port to ensure faster pooling of cargo and their delivery.
The move assumes significance as Indian shipping lines have been vehemently opposing relaxation of cabotage for Vallarpadam on the ground that it would lead to opening up of Indian coastal waters to foreign flag vessels.
The cabotage provision under the Merchant Shipping Act restricts foreign flag ships from operating between two Indian ports. This is aimed at protecting the interest of national flag carriers and development of coastal shipping.
According to sources, initially, Vallarpadam could be given the relaxation for a year or two as was done in the case of Jawaharlal Nehru port in the past.
The International container transhipment terminal at Vallarpadam, off Kochi Port, is being developed by a joint venture — India Gateway Company that is 76 per cent owned by DP World, Dubai. Other equity holders in the company are Container Corporation of India (15 per cent), Kochi-based Chakiat group (five per cent) and the Mumbai-based Transworld group (four per cent).
The terminal being set up at a cost of US$500 million is expected to be commissioned by next month or in early September.
It will have the capacity to handle 1.2 million TEUs annually in the first phase and three million TEUs on full completion of the project.
This would be DP World's fifth terminal in India. Others include Nhava Sheva,(JN Port), Chennai, Mundra and Vizag.