The International North South Transport Corridor (INSTC) will help make Latvia a gateway for Indian goods entering northern Europe, the Baltic region and Belarus.

Latvia, a tiny nation on the Baltic Sea between Lithuania and Estonia, is now hard-selling its main seaport Riga free port to exporters.

To tap the trade opportunities arising from the opening of the new multi-mode corridor, Latvia recently opened an honorary consulate office here, during a visit by a high-level official and trade delegation led by Latvian Prime Minister Maris Kucinskis. Capt Avinash Batra, who runs Mumbai-based Seahorse Ship Agencies Pvt Ltd, has been named the honorary consul.

Kucinskis, an economist by training, said Latvia wants to “widen and deepen the economic cooperation with India” while seeking to revive the ‘Amber Way’ — an ancient route that linked India and Latvia.

Riga, Latvia’s biggest sea port, is ice-free, and therefore work through the year. About 98 per cent of the 36 million tonnes (mt) of cargo handled at the port are transit goods, and the balance is for internal consumption.

Pilot train service

Using the new corridor, a pilot container train service is planned this month from JNPT to Riga, a route that is expected to reduce transit time by 40 per cent and carriage cost by 30 per cent.

The new Mumbai-Tehran-Moscow transport corridor is expected to rival the Suez Canal route, as it allows for faster, cheaper and smoother transit of goods between Asia and Europe.

The new route will use a combination of ocean, rail and road — JNPT to Bandar Abbas in Iran by sea and from there by rail and road to Riga.

“It could be the most suitable route for transit traffic between Asia and Europe,” said Shankar Shinde, Managing Director of Global Express Multilogistics Pvt Ltd.

Verners Lusis, Chairman of LDZ Logistika Ltd, a Latvian state-owned logistics firm that runs train services, said the new rail/road route is ideal to move high value-added cargo such as pharmaceuticals and car spare parts. “This will take 15 days; by sea it will take 45 days. Pricing and delivery is different by sea. If you want to move your high value-added cargo quickly, you chose rail,” he told BusinessLine .

LDZ plans to run a daily container service from Bandar Abbas to Riga.

Shorter distance

Exports to Baltic states are difficult due to the 16,129 km-long-sea route that takes about 35 days. This makes Indian exports costlier and less competitive in the European markets, Shinde added.

The new route will reduce the distance to 6,245 km and compress the timeframe by 10-12 days.

Published on November 13, 2017