Seminar Paper Capt. J. S. Gill

1. COASTAL SHIPPING AND IWT INDIA’S DREAM
By
Capt. J.S. Gill, Fellow Company of Master Mariner
Ex. SG and Deputy Master CMMI
Ex. Governing Body ICA and Indian Society of International Law
Adviser to Chambers of Commerce
Coastal shipping
Costal shipping has assumed a paramount importance in India partly in the wake of scarcity of
fuel and partly because of the inability of the surface modes of transport in meeting the
growing transport requirements of the country.
• It is considered to be the most energy and environment efficient mode of transport.
Furthermore, it entails no investment in line-haul capacity except in navigation aids and
terminals facilities.
• Transportation of bulk commodities to and from coastal areas involve longer hauls and
considerable transport effort on the part of overland means of transport.
• Allocation of traffic to coastal shipping, where distances involved by coastal route are
comparable with surface modes and points or origin and destination are located on
waterfront, can to a long way in relieving pressure on other modes,
• The national transport policy committee (NTPC) 1980 had emphasized that under
suitable conditions coastal shipping can relieve pressure on inland transport to a
substantial extent. Its empowered status is important along with several reports later
and latest SAGAR MALA is a lot repetition.
• The following factors are more pertinent.
(a) The comparative resource cost advantage of coastal shipping vis-a vis other
competing modes, particularly railways which are in direct competition with
coastal shipping especially on longer hauls.
(b) The potential of coastal trade by type and size of shipments.
(c) The size and type of vessels and nature of the operations.
(d) The port efficiency.
• The comparative advantage of coastal shipping vis-à-vis surface modes of transport is
firmly established even for short or medium hauls where the points of origin or
destination of traffic are located on water fronts. Landward legs to go from terminal and
terminal costs make it in most sector financially costlier than modes, particularly Round
from door to door.
• With the development of container traffic the multimodal transport of goods
Act does not apply which is also the need of today.
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2. • Development of inland water transport as a feeder system to coastal. Shipping where
practicable; and use of conveyor system for bulk movement to and from ports where
movement by conveyor system is economically viable is advantageous for coastal
shipping.
• For Break Bulk movement the carriage of goods by sea Act 1925 applies with a
window for relaxation which is not don’t adding cost.
• The Ministry of Shipping recent vision document, envisages increasing the combined
modal mix share of costal shipping and inland waterways transportation from the
present rate of 7 per cent to 10 per cent by financial year 2020.
(i) Cabotage has been relaxed for Ro-Ro, hybrid Ro-Ro, Ro-Pax, pure car
carrier, pure car and truck carriers, LNG vessels and over –dimensional
cargo or project cargo carriers for 5 years w.e.f. 2nd
Sep, 2015.
(ii) Abatement of service tax has been bought at par with road and rail at
70%.
(iii) Customs and Excise duty livable on bunker fuel for transport of EXIM,
empty and domestic container between two ports in India have been
exempted.
(iv) A scheme for providing financial assistance up to 75% of the cost subject
maximum of Rs 30 core for construction of exclusive berths at ports in
India have been exempted.
(v) Major ports have been directed to provided priority berthing to costal
ships to reduce waiting time of ships.
(vi) Green channel clearance system introduced at major ports for faster
evacuation.
(vii)The shipping companies who are already in possession of a valid GTL vessel trade license
may approach the registrar of Indian ships for issuance of a new one time GTL, at any time
before expiry of the GTL (a point of debate).
(viii)Dispensing with the requirement for their registration with the Director General of shipping
is expected to attract more FDI in SRUs, add to employment potential besides.
(ix)To promote container transshipment 7th
March 2016 relaxed restrictions for ports which
transship at least 50% of the container handled. Which will enable to consolidate EXIM and
empty containers at transport port in India.
(x) Service Tax has been brought at par with Road, Rail (70%).
(xi)Custom and Excise duty on Bunker fuel
(xii) A scheme of assistance up to Rs 75% of cost subject to maximum of Rs 30 cores.
(xiii) Green chancel clearance
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3. CONSTITUTIONAL PROVISION
Art. 246. (1) Notwithstanding anything in clauses (2) and (3), Parliament has exclusive power to
make laws with respect to any of the matters by enumerated in List I in the Seventh Schedule
(in this Constitution referred to as the “Union List”).
(2) Notwithstanding anything in clause (3), Parliament, and subject to clause (1), the
Legislature of any State also, have power to make laws with respect to any of the matters
enumerated in List III in the Seventh Schedule (in this Constitution referred to as the
“Concurrent List”).
(3) Subject to clauses (1) and (2), the Legislature of any State has exclusive power to make
laws for such State or any part-thereof with respect to any of the matters enumerated in List II
in the Seventh Schedule (in this Constitution referred to as the “State List”).
(4) Parliament has power to make laws with respect to any matter for any part of the territory
of India not included [in a State] notwithstanding that such matter is a matter enumerated in
the State List.
Predominance of Union Power in case of overlapping
The words ‘notwithstanding anything’ in the beginning of Cls. (1) and (2) and the words
‘subject to Cls. (1) and (2)’ at the beginning of Cl. (3) of the present Article, secure the
predominance or supremacy of the Union Legislature in case of overlapping as between Lists I,
II and III.
Thus, by reason of this provision, the general power of a State Legislature to legislate in respect
of relationship of landlord and tenant under Entry 18 of list II or Entries 6-7 of List III is subject
to the overriding power of Parliament in respect of matters in List I, so that on the subject of
relationship of landlord and tenant in so far as it arises in respect of house accommodation
situated in cantonment areas (Entry 3 of List I), Parliament alone can legislate and not the State
Legislatures.
But the doctrine of Union supremacy is not to be readily admitted to defeat the legitimate
powers of the State Legislature. The principle underlying the non-obstante clause may be
invoked only in the case of irreconcilable conflict. Parliament has exclusive power to legislate
with respect to any of the matters enumerated in List I, notwithstanding anything contained in
clause (2) and (3) of Art. 246. The non-obstante the Union Legislature in the event of an
overlap of the law made by Parliament with respect to a matter enumerated in List I and a law
made by the State Legislatures with respect to a matter enumerated in List II of the Seventh
Schedule.
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4. Law for inter-state IWT water development
Frequently water / Inland waterways user conflict with each other and for water/ waterways
objectives and priorities are to be clearly determined, for hydro energy navigation and domestic
use. What we need in water management laws is coordination between various goals involved.
Article 262 of constitution provides that parliament may bylaw provide for adjudication of inter-
state rivers or river valleys. Besides, parliament may by law provide that either the Supreme
Court or any court shall exercise jurisdiction in respect of above-mentioned water disputes.
The inter-state water dispute Act (1995) was enacted in parliament in to adjudicate dispute
between states relating to inter-state rivers and river valleys. The act provides for a tribunal
whose decision shall be final. The Act bars jurisdiction of Supreme Court and other courts on
subject matter referred to the tribunal (clause 3). For regulation and inter-state cooperative
development of rivers and river valleys Parliament has passed the River boards Act (49 of 1995)
section 4 (1) advising the government interested in relation to such matters concerning the
regulation or development of an interstate river / IWT to be successful the above promises are.
Schedule 7 of Indian constitution provisions :-
Union list
Entry 24.Shipping and navigation on inland waterways, declared by parliamenet by law o be
national waterways, as regards mechanically propelled vessel; the rule of the road on such
waterways.
Entry 25. Maritime shipping and navigation, including shipping and navigation on tidal water;
provision of education and training for the mercantile marine and regulation of such education
and training provided by states and other agencies.
The parties have a right of free use of the sea for navigation and also including shipping and
Navigation on tidal water. Tidal river is one in which the ebb and flood tide, flow, and bed
belongs to government. With public right for navigation and where does river cease to be tidal –
the thing to be looked into is the fresh water zone though impregnated by salt, where the fresh
water prevents the river is non-tidal (Race v, Miller, 1882). This is important to be known for
our rivers.
State list
Entry 13. Communications that is to say, roads, bridges ,ferries, and other means of
communication not specified in list I. municipal tramways: ropeways inland waterways and
traffic thereon subject to the provisions of list I and list III with regard to such waterways ;
vehicles other than mechanically propelled vehicles.
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5. Entry 17. Water, that is to say, water supplies, irrigation and canals, drainage and
embankments, water storage and water power subject to the provisions of entry 56 of list I.
Inland waterways other than declared national waterways is now the concern by
state government for both mechanical, sail, vessels along with non-mechanically
propelled, sail and dumbs vessels in the national waterways, which is used for
passengers and goods carriage.
Concurrent List
Entry 32. Shipping and navigation on inland waterways as regards mechanically propelled
vessels, and the rule of the road on such waterways, and the carriage of passengers and goods
on inland waterways subject to the provisions of List I with respect to national waterways.
Centre and state could legislate to cover inland waterways (other than national
waterways) for carriage of passengers and goods, for all types of vessels.
As such the IWT / IWAI has to have authority of act fully under its law which is missing.
Extinguishment of right of navigation
A public right of navigation in a river or creek maybe extinguished either by Act of Parliament,
or writ of ad quod damnum and inquisition thereon (this procedure is now otiose), or under
certain circumstances by river authorities – or by natural causes such as the recess of the sea
or an accumulation of mud. In such cases the river ceases to be navigable, at least until such
causes are counteracted. If a river is chocked with mud that does not give the public a right to
cut another passage through the adjoining lands.
INLAND WATER TRANSPORT
Current situation
The minuscule share of cargo proves that despite all its potential advantages, IWT plays only a
marginal role in the transport sector.
• Navigation Constraints : Most waterways suffer from poor condition of infrastructure like
shallow waters, narrow width of channels during the dry season, siltation, bank erosion
and inadequate navigational aids that prevent a 24 hours a day operation.
• Lack of vessels : Failure to modernize the fleet to suit local conditions and development
of road and rail transport has led to the decline of IWT in India. Yet there is a strong
case for development of IWT because of numerous potential gains for the economy.
These can be listed as:
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6. • Potential of lower capita cost: The Government of India has estimated that the capital of
developing IWT is about five to ten percent of the cost of developing an equivalent four-
lane expressway or railway network.
• Potential for cheaper maintenance cost: According to government estimates, the
maintenance cost of IWT is nearly 20 percent of that of roads.
• Potential for greater fuel efficiency: the IWT mode is most fuel-efficient. It is estimated
that one liter of fuel can move 24 tonne-km of freight by road, 85 tonne-km by rail and
105 tonne-km by IWT.
• Potential as cost effective transport mode: it has been estimated that one billion tone-
km shift of cargo to IWT would help to reduce transport fuel cost by $5 billion and
overall costs by $9 million. This saving can be utilized for economic growth in India,
poverty reduction schemes, better connectivity to remote areas, to enhance other
modes of transport, etc.
• The reservation of five percent cargo mainly chemicals, fertilizers, coal and steel to be
transported through IWT mode.
• Soft loans to be provided for the purchase of vessel, and integration of coastal shipping
and inland waterways.
GENERAL BENEFITS OF WATER TRANPORTATION
The benefits that may be accrued due to rejuvenation of IWT are as follows
• Barges can carry more cargo than trucks or railway wagons. Through barge utilization,
companies can benefit from economies of scale. As per international standard one barge
can carry cargo equivalent to the quantum transported by 15 railway wagons or 60 multi
axle trucks.
• Water transportation is less costly than land or rail transportation. On an international
standard, typical cost per tone-mile of barge is approximately 1 cent, compared to 2.5
cents for rail and 5.3 cents for trucking.
• Fuel efficiency is another key benefit of water transportation. As per international
standards, the number of miles one tone of cargo can be carried per gallon (3.785 litres)
of fuel by barge is 514 miles (827 km,) as compared to 202 miles (325 km) by train, and
59 miles (95 km) by truck.
• Water transportation is the safest mode of transportation, with the ability to move large
quantities of chemicals and toxic materials with little danger to surrounding cities and
towns.
• Water transportation is environment friendly, does not increase noise pollution and
creates less air pollution than other modes.
• Shipping freight by water reduces land congestion.
• Manufacturers benefit from lower raw material costs based on resources made available
by inexpensive transportation and less expensive distribution of products.
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7. • Additional benefits are realized by consumers. Lower prices of consumer products, water
related recreational activities/opportunities, water supply for cities, farms and industry,
flood reduction and renewable hydro-power generation.
• Even today, waterways transportation remains the cheapest mode of transport.
According to the present study, the cost of transportation by Inland Waterways is Rs 0.5
per tonne km, compared to Rs. 1.4 per tonne km by road.
SAGARMALA the new mantra has to become visible and not remain as were earlier several
committees and their empowered committee decisions seen by the author in-charge coastal
shipping.
A debate by CMMI is desired.
Capt. J.S.Gill
Mob : 9811082121
Email – captjsgillsingh@gmail.com
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