Easy sailing

New Delhi, March 15: The ministry of shipping will slash the charges for coastal vessels to 60 per cent of that paid by other ships at the country’s major ports.

Under the new package to boost coastal shipping, the cargo-related charges for these vessels will also be reduced to 60 per cent of those levied on other cargo. The ministry will soon issue directions to the Mumbai-based tariff authority for major ports (TAMP) to bring down the charges for coastal ships and their cargo, sources said.

The ministry feels that charges paid by ships on coastal routes should not be linked to fluctuations in foreign currency as this introduces an element of instability for them.

The government is keen to divert cargo from the congested rail and road links to the less-used sea route. Studies show that carrying cargo by the coastal route is five times less expensive than by road and six times less polluting too.

Coastal shipping, considered the cheapest of all modes of transport, currently accounts for a measly 7 per cent of the country’s domestic cargo movement. This is in sharp contrast to the European Union, where its share is as high as 43 per cent.

Apart from the poor infrastructure at minor ports, the high vessel and cargo-related charges at major ports are considered as major hurdles to the promotion of coastal movement of goods. The promotion of coastal shipping also forms part of the shipping ministry’s 10-year Plan under the Prime Minister's Swaranmala project.

This proposal includes a Rs 1,220-crore package for developing 20 minor ports to provide better docking facilities for the movement of coastal cargo. Another Rs 2,400 crore has been allocated for the establishment of dedicated terminals for coastal cargo at the major ports.