Vessel operators can now be allowed to bring foreign flagged vessels on the coastal routes as the Indian Government has decided to relax cabotage for special vessels.
Special vessels like Roll-On Roll-Off (Ro-Ro), Hybrid Roll-On Roll-Off (Hybrid Ro-Ro), Roll-On Roll-Off cum Passenger (Ro-Pax), Pure Car Carriers, Pure Car and Truck Carriers, LNG vessels and Over-Dimensional cargo or Project Cargo Carriers have been relaxed cabotage for a period of five years, a Ministry statement said.
The development comes in the wake of long standing demand of the shipping industry for relaxation of the cabotage law. Cabotage is transport of goods between two points in the same country.
"Such special vessels are in short supply in the country but since they cater to specific classes of cargo, their availability will make it possible to shift cargo movement for these commodities from road and rail to coastal shipping," the Indian Union Shipping Ministry said in a statement.
“As an example, large automobile clusters exist at Manesar and around Chennai. Large numbers of cars are transported from north to south and vice-versa. It is possible to shift a major part of this transportation to coastal shipping," reads the statement.
So far, the cabotage policy in India allows first preference to Indian flagships over cargo and foreign ships. Cargo and foreign ships are allowed only when no suitable Indian flag vessel is available for the same.
Indian importers and exporters use Colombo, Salalah, Singapore and Dubai hubs for shipments adding to their costs.
According to the release, the availability of Ro-Ro vessels is essential for the success of efforts to develop coastal shipping and decongesting roads and railways.