CONTEXT Major economies of the world have always realised the potential of shipping as a contributor to economic growth. Today, for instance, control of the seas is a key component of China’s Belt and Road Initiative (BRI). China is trying to take control of the Bay of Bengal and the Indian Ocean Region.

INDIA Vs CHINA SHIPPING GROWTH

• Prior to the 16th century, both India and China were equal competitors on GDP. Historical records prove that India had maritime supremacy in the world. But over the past 70 years, India has lost its global eminence in shipping due to poor legislation and politics.
• Even though, geographically, China is not as blessed as India. It has a coast only in the east; yet, seven of the top 10 container ports in the world are in China, according to the World Shipping Council.

WHAT AIDED CHINA’s GROWTH

Chinese shipping port was aided by a strong merchant marine and infrastructure to carry and handle merchandise all over the world.

WHY INDIA LAGS BEHIND?

• In independent India, helping foreign shipping liners starting from the establishment of new ports to the establishment of the present day Chabahar Port in Iran, all of India’s actions on the shipping front have been counter effective. This is due to a visionless administration.
• All the shipping infrastructure in peninsular India only helps foreign shipping liners.
• India has concentrated only on short term solutions.

IMPLICATIONS OF THIS SHORT TERM APPROACH

• Foreign carriers and their agents continue to dominate export-import (EXIM) trade with enormous hidden charges in the logistics cycle.
• Much of foreign currency is drained as transhipment and handling cost every day.
• Given this state of affairs, members of our maritime business community have also preferred to be agents for foreign ship owners or container liners rather than becoming ship owners or container liners themselves.
• This is a historical mistake and a major economic failure of the country. As a result, there is a wide gap between carrying capacity and multi folded cargo growth in the country.

LESSONS FROM THE PAST

• In the past, colonial traders had strong merchant marine, but they also developed optimum shore­based infrastructure with road and rail connectivity to facilitate their trade.
• There was balanced infrastructure onshore and at sea.  Shore­based infrastructure was developed to cater to the carrying capacity. This needs to be understood with a clear economic sense.
• At present, foreign ship owners carry our inbound and outbound cargo. This is the case in container shipping too. As a country, we have still not optimised our carrying capacity.

HURDLES BY BUREAUCRACY

• In the port sector, instead of creating regional cargo specific ports in peninsular India, the bureaucracy has repeatedly allowed similar infrastructural developments in multiple cargo handling ports. As a result, Indian ports compete for the same cargo.

GOVERNMENT INITIATIVES

• Sagarmala, a government programme to enhance the performance of the country’s logistics sector. It aims at portland industrialisation, development of world class logistics institutions, and coastal community development. It will also give a boost to domestic carrying capacity.
• As of now, shipbuilding, repair and ownership are not preferred businesses in peninsular India. Hence, tries to change the mindset of the authorities and the maritime business community through the flagship programme of Make in India.

WHAT NEEDS TO BE DONE?

• Make our major ports cargo specific, develop infrastructure on a par with global standards.
• Connect ports with the hinterlands as well as international sea routes.
• Concentrate on developing the contributing ports to serve the regional transhipment hubs for which improving small ship coastal operations is mandatory.
• Short sea and river voyages should be encouraged.
• The ship owning spirit of the Indian merchant marine entrepreneur has to be restored. Shipbuilding and owning should be encouraged by the Ministry.
• The National Shipping Board is an independent advisory body for the Ministry of Shipping, where the Directorate General of Shipping (DGS) is a member. The NSB should be able to question the functioning of the DGS, which is responsible for promoting carrying capacity in the country.
• Sagarmala should include coastal communities and consider evolving schemes to harness the century old ship owning spirit and sailing skills of peninsular India.
• Coastal communities should be made ship owners. This will initiate carriage of cargo by shallow drafted small ships through coast and inland waterways.
• Old sailing vessel owners should be encouraged to become small ship owners.
• In the coastal region, the strength of youth has not been tapped yet. Sagarmala should concentrate on consolidating the strength of the coastal youth and make them contribute to the nation’s economy with pride.

It is our long cherished dream to be competent and cost effective in international supply chain logistics. We need quality products to be available in global markets at a competitive price. This will happen only if we develop balanced infrastructure onshore as well as at sea.

Reference:

1. https://www.thehindu.com/opinion/op-ed/the-shipping-sector-is-at-sea/article33651223.ece