The Hindu Business Line : Panama Canal may soon be the fastest route to India-US trade

August 15 is an important day for the maritime industry. The Panama Canal, world's second busiest canal after Suez Canal, was officially opened on August 15, 1914, with SS Ancon being the first ship to transit the 80-km waterway.

Today, the canal, which connects the Atlantic and the Pacific Oceans through the Isthmus of Panama, may not be very significant for India's maritime industry.

However, with increasing container volumes between India and the US, the canal is going to be the quickest and easiest transit for Indian maritime trade to the east and west coasts of the US, according to sources.

Action plan

India and the US, at a meeting of the US-India Trade Policy Forum, agreed on an action plan to step up bilateral trade to approximately $60 billion from $30 billion in three years. A significant volume of the trade will be through the Panama Canal, said a source.

For instance, a ship from Chennai to the west coast of the US travels to Colombo, takes the Suez Canal (in Egypt) to the east coast of the US. The ship then takes the Panama Canal to the west coast.

Another route is Chennai-Hong Kong-Busan/Yokohama/Shanghai and via the Panama Canal to New York or New Jersey, the source said.

Huge volumes of imports from Asia, especially China and India, that used to land in the US west coast ports in the last few years, are now travelling through the Panama Canal to the east coast, the source said.

The canal consists of two artificial lakes and three sets of locks. An additional artificial lake, Alajuela Lake, acts as a reservoir for the canal.

It takes eight-10 hours to transit the canal. Over 9,22,000 vessels have used the waterway since its opening, says information available on Panama Canal's Web site.

Taking a toll

The most expensive toll for canal passage to date was charged on September 25, 2003 to the luxurious passenger vessel Coral Princess, which paid $226,194 for passage.

The least expensive toll was 36 cents and is not credited to a ship, but to the American adventurer, Richard Halliburton, who swam the canal in 1928. The average toll is around $54,000, according to the Web site says.

The next major change will be when the canal and its locks will be widened at a cost of $5.25 billion, which will be paid entirely by users through a toll system.

Under the scheme unveiled in April, a new set of locks capable of handling 12,000-TEU (twenty foot equivalent units) container ships, Capesize bulk carriers and Suezmax tankers will be opened in 2015. The current beam restriction of 32.4 metre for vessels transiting the canal limits cargo sizes to about 50,000 tonne per transit.

The expansion will allow for ships with a beam of up to 49 metres, the canal's Web site says.

By 2025, the canal authority predicts that 50 per cent of the traffic between Asia and the east coast of the US will be on the all-water route, representing a 10 per cent increase in Panama's market share or an additional 28 million TEUs transported through the waterway.

More Stories on : Shipping | Foreign Trade

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Fire in Chennai-Hyderabad Express

New freighter aircraft fly into India

Indian finalises lease of two A-330s

Panama Canal may soon be the fastest route to India-US trade

Ports on `course'

KoPT sails into consultancy

Kakinada ports riding high

Berthing abroad

Listing lines

Ircon on track for power project in Uttaranchal