- National trends, economy, and environment are shaping the way coastal shipping will operate in the future
- Shipping has many inherent advantages over surface transport such as efficiency, time-saving, and significant reduction in pollution
- Coastal traffic will boost demand for Dry Docks and Shipbuilding
The government’s Aatmanirbhar Bharat Abhiyan has significantly focused on the erstwhile less evaluated sectors in line with the major industries for enhancing indigenous capabilities. In one such recent directive shipbuilding industry has gained due attention as the Government of India has mandated compulsory use of only made in India barges and tugboats in all major ports, giving tailwinds to the Indian shipbuilding industry to set sail for growth.
Other than curtailing the Chinese dominance in the segment, the step will promote made in India shipbuilding along with its ancillary industries. Gujarat based Seros Logistics is a major player in multimodel and marine logistics as well as shipbuilding and repairing domains. It has serviced over 100 vessels at Hazira facility with an expansion plan for shipbuilding capacities. Machine Maker spoke to Ashish Agarwal, Chief Executive Officer of Seros Logistics to assess the impact and scope of the intuitive.
Impact on 'Make in India'
According to Mr. Agarwal, this step by the government will have a long-lasting effect on Indian shipbuilding and ancillary industries. “Barges and tugs use a vast variety of equipment ranging from IC engines, control systems, boilers, accommodation, etc. Manufacturers of such equipment shall grow with a positive ripple effect on the economy at large,” he says. “As the equipment used on ships are sophisticated ones, the capability of our country in technology development will definitely get enhanced,” he adds.
Demand & Cheap Exports: Current Scenario
Ashish explains that at present the Indian shipbuilding industry is facing a severe demand crunch as a cheap import from China has affected it badly. However, with new initiatives by the government such as ‘Make in India’ and recent initiatives regarding India-made vessels, demand is expected to rise and kick-start shipbuilding in India. He feels that the growth in tonnage carrying capacity is expected to strengthen the shipping outlook.
India is bestowed with a long line of coastal and inland waterways. But the scope has not been fully explored. Agreeing to the fact he states that the maritime is a vast, intricate and global industry. The factors that can affect it are seen through a very wide lens and cannot be down to individual influences. National trends, economy, and environment are shaping the way coastal shipping will operate in the future.
He feels that India has immense potential with one of the longest coastline consisting of major and minor ports. “Historically, we have only seen a growth trend in coastal movement and I continue to be positive about the sector. Shipping has many inherent advantages over surface transport such as efficiency, time-saving, and significant reduction in pollution. However, the Indian shipping industry is losing out to rail and road transport. As most of the industries are away from the shoreline, last-mile connectivity becomes expensive. All this added to heavy port charges make the movement of cargo by sea expensive. A major boost could be assigning dedicated births for coastal cargo and this will ensure less delay and in-turn reduction in demurrage.”
Structural Development & Reforms: Government’s Must-do Steps
Ashish opined that though there have been steps taken by the government as yet, the focus is needed on structural development and reforms. Although a lot of initiatives have been taken by the government to enhance inland waterways, there has been a limited movement of cargo through the river. He feels that more work for channel dredging and riverbed dredging is needed to keep waterways navigable and avoid channel siltation. He suggested that the government should implement dredging incentives by lowering GST along with floating other targeted financial incentives.
The development of inland waterways will enhance trade and reduce dependency on surface transportation. This would not only decongest highways but would significantly reduce pollution. But to facilitate such development, he suggests, infrastructure for docks and vessel repairing and building should also be developed which will initially give a boost to waterways road to waterways.
India needs to reduce logistics cost to less than 10 percent of GDP at par with developed countries from the present 13 percent. The development of IWT and coastal shipping will result in a significant reduction in costs.
Unexplored Coastal and Inland Waterways: Outlook
Talking about coastal shipping which has immense growth potential, he cites that currently, it accounts for less than 10% of Indian cargo movement. Currently, coastal shipping contributes 6 percent of cargo traffic at ports. The Sagarmala program plans to double this by 2025 aided by initiatives such as the Coastal Berth Scheme; relaxation of Cabotage; abatement of service tax on coastal shipping; green channel clearance for coastal cargo; exemption on lighthouse dues for coastal ships and reduction in GST on bunker fuel.
As for his company Seros Logistics, Ashish assures a growth-oriented approach. “While strengthening our core competencies in multimodal logistics and port operations, we are very upbeat on the future trends in the sector and are looking at new avenues, facilities, and business opportunities. Focusing on dry bulk cargo along the coast, we are also looking forward to the inland waterways segment,” he says.
With multi-locational operations and the aim of sustainable growth, the company is not only monitoring its current ways of operations but also adapting to the fast-changing environment such as digitization and a robust operations model. Stressing the importance of logistics he says,
“Logistics being the backbone of the entire value chain has to be robust and resilient for the economy to grow. In my opinion, Seros has been one step ahead of the game emphasizing a consumer-driven model. We aim to be a single point of contact for all the consumers' end to end requirements”, says Ashish Agarwal.
Seros Logistics, a pan India muti-modal-logistics company with a sizable presence in the maritime industry operates a state-of-the-art ship repair and building facility at Hazira in Gujarat. The facility is compliant with OEM standards and dedicated to the capital repair of vessels. The facility is 123 meters long and 22 meters wide. All its vessels are serviced in house. It has provided service to Reliance Industries Limited, ADANI Group, Shipping Corporation of India, Indian Coast Guard, etc.
For more details, visit www.seros.in
