Cabotage law change boost to India's bunker business
India's Prime Minister has agreed to expedite the amendment of the country's cabotage rules to allow foreign ships to transport cargo between Indian ports, Ship & Bunker reports.
The proposed amendments will facilitate efficiencies, increases in cargo handled, and more ships entering and leaving transhipment points.
This could lead to improved trade in the country's bunkering sector as the annual increase in cargo tonnage will see more ships calling at ports, creating more bunkering opportunities.
Proposed changes will only affect export/import containers or transhipment containers going through Vallarpadam for a period of three years until the country's coastal shipping sector becomes competitive.
Many Indian exports are transhipped from Kerala meaning more exports from Vallarpadam will give Kerala increased bunkering opportunities to ships passing through the route.
According to Oomen Chandy, Chief Minister, "Relaxation of these rules will allow full utilisation of the capacity of the terminal at Vallarpadam and will increase the exports from Kerala."
"The state government is focused on the development of infrastructure that can assist exports from the state," he added.
Some Indian ship owners are against the change saying they would lose the assured cargo and higher freight rates under the current regulations.
Proponents of the change have said Indian shipping lines are unable to offer adequate capacity to operate feeder service, adding to port congestion.
Currently, the Indian bunker market is estimated at two million tonnes per annum (mtpa) with India also exporting fuel to Singapore which sells bunkers at lower prices than India.
Earlier this year Mr Basheer Ahmed Sayeed, Chief Executive Officer, Chemoil Adani (Singapore) was quoted as saying "India can aim for 10 percent share of the total market of 200-210 mtpa."