Date:14/07/2006 URL: http://www.thehindubusinessline.com/2006/07/14/stories/2006071402140700.htm

Back Cochin Port Trust's move to hike rates opposed

V. Sajeev Kumar

`Increase would lead to migration of business'

Association has sent a letter to the TAMP requesting them to reject the proposal of the port seeking for a hike in rates

Kochi , July 13

The Container Shipping Lines Association (India) (CSLA) has objected to the proposal of the Cochin Port Trust for a general revision of its scale of rates, saying that the proposed hike is far higher than the prevailing rates of other competing ports.

Sources in the shipping fraternity said here that the Association has sent a letter to the Tariff Authority for Major Ports (TAMP) requesting it to reject the proposal. It is pointed out that the port had proposed a 68 per cent increase in berth hire charges from $0.0025/GRT/hr to $0.0042/GRT/hr at the container berths for vessels between 15,001 and 30,000 gross registered tonnage (GRT).

Tariff Hike

According to CSLA, the increase is substantial and nowhere the proposal explains why as per the cost statement the trend is observed where the revenue appears have been under stated, especially the year from which the increases in tariff have been proposed.

The association pointed out that the vessel related cost or the marine dues in India are very high compared to neighbouring competing hubs such as Colombo, Salalah, etc and any further increases at this stage is quite unwarranted. The level proposed is even higher compared to the other competing ports in the South and this could lead to migration of business from the port.

Pilotage

For the 15,000 GRT - 20,000 GRT vessels, the port had proposed a rate of $0.0042/GRT/hr, whereas, the current rate at Chennai is $0.00289/GRT/hr and at Tuticorin is $0.003/GRT/hr.

The pilotage, the sub activity under vessel related cost, which contributes to almost 50 per cent of the vessel related income, is giving very good return to the port, thus any further increase in the tariff of berth hire should be avoided.

Likewise, CSLA pointed out that the steep increase in dredging, salary and wages and general expenses around the time where the tariff increases are proposed are unexplained and are definitely not in line with the trend in its expenses in the earlier year and in the years following it.