Logistics

Concor to start shipping service linking Chennai and Dhaka this month

P Manoj Mumbai | Updated on February 11, 2020 Published on February 11, 2020

The Eastern coast service follows the launch of the Western coast service last year

State-run Container Corporation of India Ltd (Concor) will start coastal shipping services in the next few days on the country’s eastern coast, linking Chennai Port with Bangladesh’s capital Dhaka.

The eastern coast service will be flagged off a year after Concor entered coastal shipping in January 2019 linking Deendayal Port Trust in Kandla with VO Chidambaranar Port Trust in Tuticorin, with stops at New Mangalore Port Trust and Cochin Port Trust, in a weekly call.

India’s biggest rail hauler of containers, with a market share of 75 per cent in export-import containers, has decided to go with its Western coast ship operator Vishwa Samudra Coastal Lines Ltd to launch services on the Eastern coast.

The Eastern coast service will be run with two ships hired by Vishwa Samudra from the market.

Bangladesh’s booming economy has earned it the status as the fastest-growing economy in the Eastern hemisphere. The country’s GDP grew by 8.1 per cent in 2019 and is forecast to expand by 8 per cent this year also, according to the Manila-based Asian Development Bank (ADB).

“The opening of the service has to happen this month; we are already behind schedule by three months because we were not able to get permission from the Shipping Ministry. Initially, the ministry gave us permission to operate one vessel, but we wanted permission for two vessels and hence had to reschedule the service,” a Concor official said.

The initial plan was to launch the Eastern coast service linking Krishnapatanam port in Andhra Pradesh with Dhaka. “But, following demands from the trade, we have decided to ply the service between Chennai Port and Dhaka,” the official said.

Waterway push

Concor had picked Vishwa Samudra to launch the Western coast service last year through a tender, seeking to benefit from the impetus given by the government to the waterway mode to decongest road and rail.

The ten-year contract deploys two coastal ships capable of carrying as much as 700 Twenty-foot Equivalent Units or TEUs with maximum gross weight of 21,000 tonnes (cargo plus container weight).

Seaport Cargo Logistics Pvt Ltd, a unit of the Hyderabad-based CVR Group, the former promoter of Krishnapatnam Port in Nellore district of Andhra Pradesh, holds a 60 per cent stake in Vishwa Samudra Coastal with Hyderabad-based Vm Logistics Consulting LLP holding the balance in the joint venture company.

The Central Board of Indirect Taxes and Customs (CBIC) allows Indian-flag vessels to make calls enroute at Sri Lankan and Bangladeshi ports during their export-import (EXIM) and domestic services.

This will help fleet owners make optimum use of their space, cut transportation costs and boost modal shift of cargo from road and rail to sea.

The government has started the process of privatising Concor by selling 30 per cent of its stake in the company to a strategic partner along with transfer of management control.

The government currently holds a 54.8 per cent stake in Concor.

Published on February 11, 2020

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