Dollar Linked Coastal Tariff Put in Abeyance by Shipping Ministry

By | May 17, 2016
Reforms to Promote Coastal Shipping: Dollar Linked Coastal Tariff Put in Abeyance by Ministry of Shipping

Promotion of Coastal Shipping has been one of the major endeavors of Ministry of Shipping. In this regard, the Ministry of Shipping amended the 2005 scheme of coastal concessions on coastal vessels and cargo/ container related charges in September 2015.

The amended instructions provide that restatement of rates for coastal vessel should take into account the exchange rate fluctuation of Indian Rupee vs the US dollar, so that vessels related charges for all coastal charges should not exceed sixty percent (60%) of corresponding charges for other vessel. This was notified to Traffic Authority for Major Ports (TAMP) by a notification in October, 2015.

However, the TAMP has pointed out that in the context of general revision proposals of a few Ports in restatement of Coastal rates has resulted in step increase in rates of coastal vessel /container as compared to pre-revised rates with the linking of Indian Rupee to US dollar.

Since, this would seriously hamper the Ministry of Shipping’s endeavor to promote coastal shipping as the transaction in coastal shipping/operations are entirely domestic and the tariff is collected in Indian Rupee, the need to link the tariff to US Dollar and exchange rate fluctuations needs to be reviewed at length so that there is no adverse impact on the promotion of coastal shipping.

The Ministry of Shipping has decided that till the time these issues are not addressed the instructions issued by Ministry in its letter dated 17th September, 2015 be put in abeyance. TAMP has been directed to appropriately prescribe the coastal cargo/container related charges at all Major Port Trusts and Private Operators.

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