India remains committed to maintaining and enhancing trade and connectivity with both Myanmar and Bangladesh.

In Myanmar, India is working closely with the authorities to ensure continued operation of the Sittwe Port; while efforts are on to extend IBP (India Bangaldesh Protocol) route from Kolkata to Varanasi through inclusion of Sahibganj and Varanasi as new Port of Call, Union Minister of Ports, Shipping and Waterways (MoPSW), Sarbananda Sonowal said.

According to him, India is also looking at setting up its own Shipping Services Company (SSC) “to increase the share of Indian-flagged vessels” and address challenges of fragmented cargo and short-term chartering.

In an interview to businessline, Sonowal talks about India navigating stress in the neighbourhood – specially Myanmar and Bangladesh – to manage port ops there; strain on global economies impacting cargo movement, setting up a Shipping Services Company, and pushing for PLI. Edited excerpts:

Q

Stress in the neighbourhood is apparent, especially in Bangladesh and Myanmar. How is MoPSW dealing with port ops in these countries?

The situation in our neighbourhood, particularly in Myanmar and Bangladesh, do present challenges. But India remains committed to maintaining and enhancing trade and connectivity with both countries.

In Myanmar, we are working closely with the authorities to ensure continued operation of the Sittwe Port. The port is vital for our access to the north-eastern states. Planned facilities to be constructed at Sittwe will meet the goal of Kaladan Multi-Modal Transit Transport Project, (KMTTP).

The River Kaladan (is) where the IWT (inland water transit) can be integrated with shipping to form a transport link. Using this transport link, cargo can be moved from Kolkata Port (India) or other ports of our country to Sittwe Port (Myanmar) by sea; and from Sittwe port to Mizoram (in NE India) either through the inland water transit or via highway, and vice-versa. The IPGL (India Ports Global Ltd) will be responsible for operating Kaladan Multi-Modal Transit Transport Project; operations and maintenance of Sittwe Port and IWT Port of Paletwa (also in Myanmar).

As for Bangladesh, the Chittagong Port remains a crucial link in our regional trade network. Protocol on Inland Water Transit and Trade (PIWTT), sets out rules and regulations for conveyance of goods by registered vessels.

Efforts are on to extend IBP (India Bangaldesh Protocol) route from Kolkata to Varanasi through inclusion of Sahibganj and Varanasi as new Port of Call.

Our initiatives, like the use of Chittagong and Mongla ports for transit, are progressing, and we remain optimistic about further expanding trade routes. We have confidence in our cooperation with Bangladesh to address any operational issues as and when they arise.

Q

Some key economies like Europe and China are under stress. How does it impact cargo movement to & from India?

Slowdown in economies of China and Europe will have an impact on global trade dynamics. And India, as a major player in the international trade arena, may experience (some) impact on its cargo movement.

However, despite such challenges posed by global economic stress, India is focusing strategically on developing new ports and transport corridors, while simultaneously enhancing the capacity of existing ones to help mitigate some of these impacts. By improving infrastructure and diversifying trade routes, India is striving to maintain robust cargo movement and support its economic growth in the face of any global changes.

Q

Wasn’t the Centre planning to have a government and industry co-promoted shipping line?

The Shipping Corporation of India (SCI) - being a government owned shipping line – is presently working to develop a comprehensive business plan for expansion. Also, the MoPSW is collaborating with SCI and other ministries – including the Ministry of Commerce and Industry, the Ministry of Petroleum, the Ministry of Fertilizer and Ministry of Steel – with the primary objective to gather data, conduct market assessment, stakeholder interaction, cargo aggregation and then develop strategies for the shipping line aligned with the industry needs.

Also as a part of the proposed MDF (Maritime Development Fund) a Shipping Services Company (SSC) is being planned as an enabler.

Q

What would be objectives of these Shipping Services Company (SSC)?

The Shipping Services Company is envisioned to increase the share of Indian-flagged vessel by addressing challenges of fragmented cargo and short-term chartering; thereby ensuring cargo aggregation and long-term charter contracts.

The company, we hope, will prove instrumental in driving growth towards Indian ship ownership and tonnage. The SSC is envisioned to operate as a professional ship service management entity. It will take on comprehensive responsibilities including demand aggregation, procurement, contract management, and ship management, ensuring efficient coordination.

Q

Is India re-looking into the PLI for shipbuilding?

Indian shipbuilding industry’s challenge is that there is a lack of domestic demand, and the industry is not price competitive with the global market leaders. Therefore, our policies and schemes have been to bridge this difference; and bring domestic and global demand to the Indian shipyards.

The performance linked incentive scheme (PLIs) was discussed with industry stakeholders at workshops held on February 14, 2024; and also on February 21, 2024. Subsequently, Ministry has also held multiple discussions with various stakeholders on the ways to boost shipbuilding output in India.

All incentives, including those in terms of skilling, R&D and capacity development which may be effective in boosting the container manufacturing and shipbuilding industry capacity are being considered .