IMO 2020 Compliance A Tough Voyage

Use of low sulphur fuel is increasing the operational cost of coastal ship operators, while the cost of moving cargo by road and rail remains unchanged, making difficult the survival of coastal shipping

Coastal container shipping growth in India has witnessed downward trend in CY 2019 by approximately 10 per cent compared with last year growth of approximately 25 per cent. Low growth in CY 19 against CY 18 is due to addition of capacity and paltry conversions of cargo from rail and road to coastal. Total coastal shipping market size is 280-300,000 teus/anum laden coastal and 230-250,000 teus empties per annum.

Indian coastal ships carry 70-80 per cent filled capacity of cargo in each trip from west to east with mostly empties in return, resulting in unviable trade for the players to sustain in the long run. Most of the operators have shut down their operations in the last couple of years. Major cargoes handled still remains same namely cotton, rice, wheat, sanitary ware, tiles, marbles, fertilizers, minerals, etc. Even though there has been tremendous impetus given to specific commodities by the government, usage of coastal shipping is unattractive to domestic players and traders due to high transit time, cost and multimodal cargo handling process.