Global cruise liners come calling

International cruise liners are increasingly romancing Indian waters, in the wake of government's decision to open up the cruise sector to foreign direct investment (FDI) to promote tourism.

"Over 16 international cruise liners have confirmed their visit to Mumbai Port between November 2005 and May 2006. Cruise major Star Cruises' vessel Super Star Libra has already chosen Mumbai Port as its home port and will make 110 calls up to May 2006," a senior Mumbai Port official said.

The cruise liners of global majors including P&O, Hapag Lloyd, Silver Lines, Tranocean, Holland USA, Radisson, Cunard Lines, Seaborn Cruises and Renaissance Cruises would call at Indian ports. The major ports in Mumbai, Kochi, Goa, New Mangalore and Tuticorin have cruise handling facilities.

A policy for cruise tourism is being evolved which is likely to spell out details of FDI regime besides measures to upgrade ports and other related infrastructure.

A high-power steering group under the chairmanship of minister of shipping and the minister of state for tourism as its co-chairman has already been set up to finalise a cruise policy.

Earlier, government has suggested amending the Merchant Shipping Act to allow FDI in cruise shipping to exploit tourism potential of the country.

The government may even consider liberalising FDI norms and also have a relook at Section 21 of the Merchant Shipping Act to relax registration procedure for foreign cruise companies.

Commenting on the government's decision, Keiki Master, VP, JM Baxi,said there was scope for FDI in cruise shipping as the international cruise liners led by Star Cruises have started testing waters.

JM Baxi handles over 80 per cent of the cruise vessel calling at Indian ports including Cunard Group of companies and Royal Carribean.

"The global cruise majors are keen on investing in the cruise infrastructure at Indian ports. As Star Crusies has already selected Mumbai Port as home port, the international majors are adopting wait and watch approach," Master said.

However, industry analysts feel opening up of FDI would not evoke any positive response from international operators. "The government could not attract even a single penny in last eight years after opening up the shipping sector to FDI," said an analyst.

There is no dedicated cruise terminals at Indian ports as cruise vessel handling is not profitable proposition for port compared to cargo vessel handling.

"At Mumbai Port, the dedicated passenger facility is used for handling cargo vessel due to infrequent calls of cruise vessels," the analyst added. Mumbai Port, however, is planning to construct a dedicated cruise terminal near Gateway of India.

A senior Shipping Corporation of India (SCI) official said cruise shipping was more related to hospitality industry and not shipping. SCI has no plans to acquire any cruise vessel.

ANCHOR AHOY!

Over 16 international cruise liners have evinced interest in setting base in Indian ports

The government has taken note and efforts are afoot to formulate policy for cruise tourism and attract FDI into the sector

Analysts however are negative about the growth of the sector as poor infrastructure and irregular traffic ails the industry