India cuts bunker tax
Bunkering at India's southern port of Kochi has received a major boost after the Kerala state government drastically reduced taxes on bunker products sold to foreign vessels.
The state government reduced value added tax (VAT) on bunker products to 0.5% in mid-August from 12.5% previously, local sources confirmed with Bunkerworld.
''The region's locational advantage – situated just 11 nautical miles off the main shipping route – offers great (bunkering) potential to service vessels plying to and from Colombo, Fujairah and Singapore,'' a local source told Bunkerworld.
The government had been mulling over the tax reduction for a few years – a process that many considered as bureaucratic hurdles and reflective of the tardy attitude of relevant regulatory agencies in India.
"The state government reduced VAT on bunker products to 0.5% from 12.5%"
The tax reduction is a welcome move that could help Kochi become an attractive bunkering port due to its close proximity to international sea routes.
India's three biggest oil refiners – Indian Oil Corporation Ltd, Hindustan Petroleum Corporation Ltd and Bharat Petroleum Corporation Ltd – all have a presence in Kochi port as bunker suppliers.
Cochin Port Trust recently completed a feasibility study to constructing a bunkering terminal in Kochi port and is on course to meet the 2011 project completion date.
The bunkering terminal, estimated to cost between 1.5-1.8 billion rupees ($31-37 million), will be awarded on a design, build, finance, operate and transfer (DBFOT) basis for a concession period of 30 years.
The multi-user liquid terminal will be built on Puthuvype Island, part of Kochi port.
After the project is completed, global tenders will be floated for operation of the bunkering terminal, according to the port authority.
Apart from the bunkering terminal project, Kochi port is also seeing the Vallarpadam container transshipment and the LNG terminal projects.
''The projects are nearing completion as per schedule and we hope to record a steep rise in revenue once they are over,'' N. Ramachandran, chairman of Cochin Port Trust, was quoted saying.
He added that Kochi port would become the main driver of Kerala state's economy.
The state government reduced value added tax (VAT) on bunker products to 0.5% in mid-August from 12.5% previously, local sources confirmed with Bunkerworld.
''The region's locational advantage – situated just 11 nautical miles off the main shipping route – offers great (bunkering) potential to service vessels plying to and from Colombo, Fujairah and Singapore,'' a local source told Bunkerworld.
The government had been mulling over the tax reduction for a few years – a process that many considered as bureaucratic hurdles and reflective of the tardy attitude of relevant regulatory agencies in India.
"The state government reduced VAT on bunker products to 0.5% from 12.5%"
The tax reduction is a welcome move that could help Kochi become an attractive bunkering port due to its close proximity to international sea routes.
India's three biggest oil refiners – Indian Oil Corporation Ltd, Hindustan Petroleum Corporation Ltd and Bharat Petroleum Corporation Ltd – all have a presence in Kochi port as bunker suppliers.
Cochin Port Trust recently completed a feasibility study to constructing a bunkering terminal in Kochi port and is on course to meet the 2011 project completion date.
The bunkering terminal, estimated to cost between 1.5-1.8 billion rupees ($31-37 million), will be awarded on a design, build, finance, operate and transfer (DBFOT) basis for a concession period of 30 years.
The multi-user liquid terminal will be built on Puthuvype Island, part of Kochi port.
After the project is completed, global tenders will be floated for operation of the bunkering terminal, according to the port authority.
Apart from the bunkering terminal project, Kochi port is also seeing the Vallarpadam container transshipment and the LNG terminal projects.
''The projects are nearing completion as per schedule and we hope to record a steep rise in revenue once they are over,'' N. Ramachandran, chairman of Cochin Port Trust, was quoted saying.
He added that Kochi port would become the main driver of Kerala state's economy.