India considers easing cabotage laws

India considers easing cabotage laws    India's Ministry of Shipping is discussing whether to relax cabotage laws that would allow foreign ocean carriers to move containers and other cargo between domestic ports.
   Indian law restricts the movement of cargo between domestic ports to Indian-owned and flagged vessels.
   The discussion, reported this week by Indian business news outlets, could be a significant boon to carriers eyeing greater access to the Indian market. The country has less than a handful of ports large enough to handle mainline vessels calls. And much of the country's volume is handled via feeder services from Colombo, in Sri Lanka, whose container terminals have deeper draft than all but one Indian port.
   Nearly three-quarters of India's container volume is transshipped via Colombo or transshipment hubs in Southeast Asia or the Middle East, like Singapore, Port Klang, Jebel Ali or Salalah.
   The shipping ministry estimates that India's importers and exporters face more than $200 million in added costs due to transshipment.
   The situation could potentially change in September, when a massive deepwater transshipment terminal opens in Cochin. The terminal, developed and operated by DP World, is designed to compete directly with Colombo and will have capacity for 1 million annual TEUs initially and up to 3 million TEUs if demand requires.
   However, if domestic trades are restricted to domestic carriers, it's likely foreign lines would eschew the use of the Cochin transshipment terminal so that they could use feeder lines of their choice from Colombo.
   Indian ship owners and carriers are, without surprise, opposing any move to allow foreign operators. The ministry is asking for comments from the industry, but has set no deadline to propose a change to the existing laws. ' Eric Johnson