Items must form at least 50% of all cargo
Foreign-flagged ships will be allowed to transport agriculture, horticulture, fisheries and animal husbandry commodities between Indian ports without a licence, the Shipping Ministry said in an order issued on Tuesday in a second round of cabotage relaxation.
On Monday, the Ministry had eased cabotage rules by allowing foreign-flagged container ships to carry export-import (Exim) containers for transshipment and empty containers on local routes without a licence.
Local route access
Only Indian registered ships are allowed to ply on local routes for carrying cargo, according to India’s cabotage law. Foreign ships can operate along the coast only when Indian ships are not available, after taking a licence from the Director-General of Shipping, according to the rule that was designed to protect local ship owners. The cabotage relaxation granted to foreign flagged ships for carrying agriculture, horticulture, fisheries and animal husbandry commodities specified in the Indian Trade Classification (ITC), Harmonised System (HS) of the Director-General of Foreign Trade, Union Ministry of Commerce and Industry, is conditional on such commodities contributing to at least 50 per cent of the total cargo on board the ship, PK Sharma, Under Secretary in the Shipping Ministry, said in the May 22 order reviewed by BusinessLine.
These commodities are meat and edible meat offal, fish and crustaceans, molluscs and other aquatic invertebrates, dairy produce, bird’s eggs, natural honey, edible products of animal origin (not elsewhere included), vegetables and certain roots and tubers-edible, fruits and nuts- edible, peel of citrus fruits or melons, coffee, tea, mate and spices, cereals, products of the milling industry, malt, starch, inulin, wheat gluten, oil seeds and oleaginous fruits, miscellaneous grains, seeds and fruit, industrial or medicinal plants, straw and fodder, vegetable plaiting materials (not elsewhere specified or included), animal or vegetable fats and oils and their cleavage products, wool prior to yarn formation, cotton, prior to yarn/thread formation, vegetable textile fibres such as flax, hemp and jute.
Water-borne transportation modes, including coastal shipping, being comparatively cheaper modes of transport would enable farmers to access a larger market profitably, widen the range of goods which can be marketed, and lengthen the distances over which domestic trade can be conducted, according to the ministry.
The national perspective plan of Sagarmala programme estimates a potential of more than 9 million tonnes a year for coastal movement of food grains and processed food.