Shipping tonnage seen at 10mn GRT in 2 years

Q&A/NARESH SALECHA

Naresh Salecha, Senior Deputy Director General of Shipping, wears many hats. He is the spokesperson of the directorate general of shipping and the secretary of the National Shipping Board (NSB), an industry policy advisory body.

In an interview with S Ravindran, Salecha says that NSB is confident that India's shipping tonnage, which has been on an upward trend for the past few months, will touch the 10 million gross registered tonne (GRT) mark in the next two years.

The NSB met after a gap of one year at Paradip on February 27. Since its recommendations are not binding, are they really acted upon?

Certainly. At the previous meeting held at New Mangalore last year, the NSB had recommended the introduction of a tonnage tax regime. The Union finance minister has in his mini-Budget speech said that this will be considered. This shows the importance attached by the government to the recommendations made by the board.

Further, NSB is a statutory body constituted under the Merchant Shipping Act, 1958. It has 22 members and has representatives from all the stakeholders in the maritime industry. Out of 22 members, six are members of the Parliament (four from the Lok Sabha and two from the Rajya Sabha). Other stakeholders represent the Central government, ship owners, seamen and experts, navy and commerce ministry.

The advise of such a body is always treated with respect.

What is the significance of the latest meeting?

The present meeting assumes significance because of the time and subjects that were discussed. The important items which were discussed were the 'Sagarmala project' and the development of 'Coastal Shipping'.

The Sagarmala is an ambitious national programme involving public/private partnership for the development of Indian ports and shipping, and other related sectors like shipbuilding, ship repairing etc.

The board had a detailed discussion and a presentation was made by a senior officer before the ministry of shipping.

Various components of the Sagarmala and the strategy for implementing the project in the next 10 years was discussed. This scheme envisages an investment of Rs one lakh crore in the next 10 years by public/private participation. D T Joseph, secretary (shipping), who has been the force behind the project, participated in the meeting and briefed the members about the government's plan of action.

What was the discussion on coastal shipping about?

The Centre gave the consultancy contract on this issue to Tata Consultancy Services (TCS) which submitted their report in December 2003. Coastal shipping is significant for the integrated transport system of India. The present share of coastal shipping is very low.

In developed countries such as the European Union the share of coastal shipping is 43 per cent of the total domestic cargo. But in India it is only seven per cent.

The board felt that after the implementation of the report, there might be substantial savings in terms of fuel costs. Further it would also result in the prevention of pollution and reduction of traffic congestion (both road and rail).

Was any other matter discussed at the meeting?

Other issues which were discussed at the meeting were relating to the Indian shipbuilding industry and the implementation of the International Ship and Port Facilities Security (ISPS) Code.

Director general of shipping G S Sahni pointed out that India is one of the few countries which is in an advanced stage of implementing the ISPS Code. After July 1, 2004, ships which are not ISPS compliant will not be allowed to undertake international voyage.

Similarly, ports which are not compliant with ISPS requirements will not be able to receive any foreign vessels.

The representatives of the seafarers' union also pointed out the Rs 92.78 crore loss incurred by the Seamen's Provident Fund in the Home Trade Scam which not yet been reimbursed.

Do you expect the recent trend of fleet acquisitions to continue due to the rising freight rates?

Yes. The Indian tonnage has grown and reached 6.72 million gross registered tonne (GRT) in January 2004. It is expected that after the introduction of the tonnage tax regime, this will cross 10.00 million GRT in the next couple of years.