Makers of steel, fertiliser, cement and other commodities will now get cash incentives from the Shipping Ministry for diverting the movement of their finished products from road and rail to coastal shipping.

Incentives The Ministry of Shipping has approved a scheme that seeks to provide incentives to manufacturers and shippers to opt for coastal shipping in the form of cash incentives and reduction in port handling charges. It is expected to come out with a formal announcement in the next couple of weeks.

The scheme is based on the recommendations of the high-level committee instituted by the Ministry to give a boost to coastal shipping and ease the burden on road and rail movement of commodities.

P.V.K. Mohan, Chairman of the committee and Chairman of the National Shipping Board, expects at least 20 million tonnes of cargo transported by road and rail to be diverted to coastal shipping — which is cheaper than other modes of transportation.

At present, about150 million tonnes of cargo are moved through this mode of transportation, constituting hardly seven per cent of India’s overall cargo movement. According to the new scheme, new cargo that are transported through coastal shipping will get an incentive of 50 paisa per tonne per nautical mile up to a maximum of 500 nautical miles. The loading ports will administer the release of the incentive and these in turn will be later reimbursed by the Ministry.

“Initially, the new cargo eligible for this incentive will be steel, fertiliser, food grains, automobiles, marbles, tiles, cement, sugar and salt. The list will be later expanded,” Mohan told mediapersons here today. To encourage shippers, the Ministry will be providing a rebate of Rs 1,000/ TEU in container terminal handling charges at ports up to a cap of 500 TEU/ vessel. The terminal operator will provide the rebate and will be reimbursed by the Ministry.

Similarly, coastal vessels will now get an additional 20 per cent rebate in port-related charges.

amitmitra@thehindu.co.in

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