India’s 12 Seaports to be connected with Railroads.

The Union Road Transport and Shipping Minister - Mr. Nitin Gadkari in a recent media intervention while addressing a Confederation of Indian Industry (CII) event, said that the Government plans to work towards directly connecting all 12 Major Sea Ports with railroads and start a roll-on-roll-off service to transport vehicles easily from factories.

He hinted that work is also being done to draft new policies for shipbuilding and ship-breaking industry.

He emphasised that inland waterways have to be developed since it is much more economical compared to road and rail transport and for this, major rivers need to be connected.

The minister said that it is vital for the private sector to collaborate with the Government to develop infrastructure. However, he admitted that the private sector is shying away from PPP (Public – Private – Partnership) projects primarily because of high interest rates and reluctance of banks to fund such projects. Speaking on PPP, the Union railways Minister – DV Sadananda Gowda has recently announced that the Indian Railways is all set to come out with a Model Concession Agreement (MCA), here FDI will be allowed only for creation of infrastructure and other development activities in sectors where no FDI currently exists. At present FDI is open only for operation of high speed rail and dedicated freight corridors whereas FDI is restricted in other areas. 

Given the current situation, foreign investment can prove to be the best source for low-cost funding, said Mr. Gadkari.

Speaking about his Ministry's new initiatives, he said a special North East Corporation would be set up soon to drive infrastructure creation in the North East region. He also spoke about efforts being made to expedite tunnel projects in Jammu & Kashmir.

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India & Bangladesh agree to improve Border Haats

India and Bangladesh agreed to improve the Indo-Bangladesh border haats (small markets) as special economic centres aimed at expanding cross-border trades, along their border in Tripura, Assam, Mizoram and Meghalaya to boost local trade and economy. One such border haat was setup at Meghalaya’s border with Bangladesh in 2012.

The United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP), the Asian Development Bank and the Meghalaya state government had organised a regional meeting where the government representatives of Nepal and Bhutan had also participated.

The Meghalaya government proposed to Bangladesh to set up 22 new border haats across the 443- kilometre long Bangladesh - Meghalaya border. Currently, Bangladesh and Meghalaya have two border haats - one at Kalaichar in West Garo Hill district and Baliamari of Kurigram district, and another in Balat and Lauwaghar in Sunamganj district.

“Border Haat” means makeshift bazaar at a certain point of zero line of the India-Bangladesh border for allowing villagers of both the countries to market and shop each other’s products once in a week.

However, the initiative of boosting the country's trade with India through border haats did not draw results as desired as India had imposed some restrictions on selling Bangladesh's products which could not attract Indian traders and consumers at the bordering areas. As a result, both Bangladeshi and Indian traders were disheartened and they lost their interest to run their businesses at the haats as necessary facilities had not been developed.

Tripura MP - Jiten Chaudhury in a recent seminar on India-Bangladesh relations conveyed that there was demand for more than 100 border haats in the state’s border with Bangladesh. Their centre has cleared 4 border haats on Tripura-Bangladesh border and as many on the Meghalaya-Bangladesh border and only a few of them are complete.

The Tripura government has proposed to set up four ‘Border Haats’ along the border with Bangladesh. Both Indian and Bangladesh government have also agreed to this proposal. India’s commerce ministry has been providing INR. 2 – 3 crore to develop infrastructure in these border haats.

The haats are to be set up within five km of the international border. They will sell local agricultural and horticultural products, spices, minor forest products (excluding timber), fresh and dry fish, dairy and poultry products, cottage industry items, wooden furniture, handloom and handicraft items. Trading in these bazaars would be held once or twice a week, and a spending cap of $50 will be imposed per head. No local tax will be imposed on the trading. Both Indian and Bangladeshi currencies will be accepted.   

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Indian Govt approves setting up of 13 Textile Parks

 

The Minister of State (Independent Charge) for Textiles - Santosh Kumar Gangwar has approved the setting up of 13 textile parks, entailing minimum investment of INR. 100 crore each, a move that will help generate thousands of jobs.

Mr. Gangwar, commented that he has approved the setting up of 13 textile parks and will consider investment proposals of minimum INR. 100 crore for the parks, and a subsidy amount of 40 crore each will be provided by the ministry. Adding further Mr. Gangwar said that if an industrial park worth INR. 100 crore is established, it will provide jobs to at least 2,500 to 3,000 people as the textile industry generates maximum employment after the agricultural sector.

Mr. Gangwar also said he has called a meeting of the state Textile Ministers on 24 September, to seek their inputs on the new Textile policy and other related matters. The Textiles Ministry had earlier sought comments from the public on their draft i.e. Vision, Strategy and Action plan of the new textiles policy.

The key objectives of the new National Textiles Policy include developing a vision statement of the textile sector for the next decade to treble market share from the current 4 percent in the next decade.

Keeping in view the various changes in the textile industry on the domestic and international fronts and the need for a road map for the textile & apparel industry, Ministry of Textiles had initiated the process of reviewing the National Textile Policy, 2000.

Government aims to formulate a new improved Textile Policy to address concerns of adequate skilled work force, labour reforms, attract investments in the textile sector, and to provide a future road map for the textile and clothing industry.

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INDIA – CHINA : Efforts to Improve Trade Relations.

The recent visit of Chinese President Xi Jinping’s to India has removed some of the suspicions of two countries and has pushed bilateral relations to a new age. India and China agreed to work on improving the skewed trade relations and sort out the contentious border issue, which has often soured relations between the two countries.

As part of the trade balancing initiative, Chinese President Xi Jinping, during his three-day visit to India, announced that China will continue to take active steps to give more market access to products from India, including pharmaceutical and farm goods. Further, he also committed investments of $20 billion over five years.

Prime Minister Narendra Modi said that during his talks with Xi he had expressed concern over the worsening trade imbalance and sought the Chinese President’s partnership in improving market access and investment opportunities for Indian companies. According to Indian statistics, with an increase in the bilateral trade over the last decade, the trade imbalance against India also increased exponentially from $18.65 billion in 2009 to $36.86 billion in 2013.

Mr. Modi also mentioned that he was pleased with the agreement signed on two Chinese industrial parks, to be set up in India. One in Gujrat and the other in Maharashtra, at an investment of INR. 40,800 crore ($6.8 Billion). The idea of setting up industrial parks in India is to facilitate Chinese investments in the manufacturing sector as an aspect of strategic and cooperative partnership. Chinese investors from electrical, electronics, plastic and other sectors will establish their units in these industrial parks.  

The two sides exchanged 12 documents, including a five-year economic and trade development plan. An agreement on audio visual co-production, two documents on railways, another document on work plan for drug administration and a MoU on culture were exchanged between the two countries.

A MoU on peaceful use of outer space and a twinning agreement between Shanghai and Mumbai was also signed.

Prime Minister Narendra Modi said that Chinese President Xi Jinping has assured that he will take concrete steps to correct the trade imbalance and give more market access and investment in China. Modi has invited Chinese investments especially in Infrastructure.

Concrete steps on railways were also discussed between Modi and Jinping. The two leaders agreed to increase the speed on the existing rail section from Chennai to Mysore via Bangalore. China has also agreed to allow new route from Nathula to Kailash Mansarovar. This will also be usable during rains.

The Prime Minister has expressed concerns over what happened at the borders. Both of them discussed openly and touched on difficult issues, he said, adding that boundary issues will be sorted out soon.

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BEAWARE of Malpractices & Fraud Job Agents in Shipping Industry

Going by the quote, by Jonathan Winters, "If your ship doesn't come in, swim out to meet it", clearly portrays the thought process of a seafarer today who is at his peak of frustration as being a victim to the malpractices that are currently plaguing the shipping industry.

Any graduate cannot directly take up a shipping career, he has to first complete maritime education from a DG approved Maritime Training Institute. It is recommended to all the aspirants to avoid falling prey to any agency, company or 3^rd parties which are not approved by DG shipping. There are “premium” charges, rather called as illegal service charges which non-recognized agents and even slam ship management companies demand from freshers by promising them lucrative opportunities.  

Several maritime jobs websites provide an online platform to job agents to post fake advertisements. As there are no accurate means to scrutinize their credibility, these websites land up selling personal details and resume of candidates without providing them with proper job descriptions and addresses of the companies, thereby unknowingly encouraging scam job postings. It is difficult for a new seafarer to identify fake advertisements at the first glance, however one can stay alert of such malpractices by not entertaining imposters who are faking themselves as company representatives, or people who ask for huge amounts in return of job placements without proper offer details, or even job portals displaying Ads of almost all companies in India but address and contact details are unavailable.

Most ship management companies have very transparent and professional hiring procedures for new candidates. However, there are a few who knowingly or unknowingly engage in malpractices. The most common practice is to provide a future joining date after a month or two, and then later just inform the candidate that the joining has been delayed. Sometimes these delays are extended beyond four to six months or even further leading to an extremely frustrated candidate who has now lost faith in the company. Ship management companies sometimes also appoint fleet managers who post ads under fake names providing their contact details or sell the information to an agent who would in turn seek a hefty commission for a job opportunity, thus making the hiring process a lucrative business for the few who are involved. To avoid this practise, it is important that companies should take a thorough background check of the agent before his appointment.

The job scam industry is active due to several aspects, of which financial crises affecting the industry stands to be majorly blamed. However, there are other factors that are also contributing; such as fake promises and improper guidance to the maritime students at the start of their career, imbalance in demand v/s supply of mariners caused by increase in number of maritime academies and passing graduates and reducing number of jobs, reducing number of fleets by shipping companies, lack of quality standards in education and training of new candidates where the focus is more on quantity of academic clearances.  

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Thome India Shore Staff visit – Vessel Familiarisation

Visiting a vessel is a one of a kind experience that each and every non seafaring shore staff wishes to engage in. So when, Thome India’s shore staff got their opportunity to visit vessel “Ardmore Calypso”, their enthusiasm piqued to the highest level.

The team began their day by boarding the vessel post clearing all the necessary ISPS security checks. They received a warm welcome from the Capt of the vessel who had a long day of events already planned for them.  The team began their learning experience by observing a Port State inspection in process where they witnessed the captain engaging with the port state inspectors who were conducting an audit. After a brief period they proceeded to the galley. The team was overwhelmed with joy to see a delicious lunch prepared by the Chief Cook all ready to be served to their delight.

Post enjoying their little feast, they headed to the engine room and under the supervision of the Chief Engineer, they observed the daily work antics of the engineers also understanding the operative functionalities of the engines, dial, gauges and other machineries.

The team then joined the Captain again who gave them a short tour of the deck where they saw the deck officers in action with their daily routine work. They also visited the ship’s bridge thereby getting an opportunity to learn on the usage of navigational equipment, charts, ECDIS, radars etc. They also witnessed a discharge operation in process. The discharge operation was seen to be conducted in a very safe and secure environment. The team also got exposed to the seafarers on board and it was stressed by the Captain that every activity onboard was orchestrated by the seafarers onboard. It was also explained that Thome strived hard to provide a decent working and living condition onboard for the seafarers and worked timelessly to ensure safety to them, as well as the ship and its cargo. Thome also accorded top most priority to preservation of the environment thereby endeavouring its best to fulfil the IMO’s objective of achieving safe, secure, efficient and economical sea transport on Clear Ocean. The team also appreciated Thome’s ideology of according priority to the Human Element.  

The entire visit was a very enriching experience as the vessel played the role of a fully functional learning centre. The team came back with a better understanding of life at sea which has helped them to respond better to the seafarers concerns while on-board and ashore. 

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India in need for World Class Infrastructure

Outlining their agenda for five years, the current government announced a slew of measures to push growth and create jobs, which will include encouraging investment and creating a predictable, transparent and fair environment.

Prime Minister of India – Mr. Narendra Modi upon reviewing the progress of eight major infrastructure sectors in the country as part of his monthly review meetings officially stated  that, accelerated infrastructure development was his top priority and that he senses the need to create world-class infrastructure. The eight sectors under the area of focus are: civil aviation, ports and inland waterways, roads, railways, telecom, power, coal, and new and renewable energy.

Further, the Prime Minister emphasised the importance of monitoring the progress of infrastructure development through efficiency parameters identified for each sector which their respective Ministries should monitor on electronic reporting formats. Adding further, the initiatives undertaken by state governments as well as PSUs with other countries, including SAARC (South Asian Association for Regional Cooperation) countries, should also be taken into account while monitoring the progress of infrastructure sectors.

Connecting to the aspects of infrastructure development, Mr. Modi also spoke on the “Sagar Mala” project, announced by him in June this year. This project is aimed at interconnecting all coastal cities in India through road, rail, ports and airports through a special development package. The project would enhance the unique identities of these coastal cities in consonance with sea-side life.

The ideology of infrastructural development would also become a major link for Mr. Modi’s "Make in India" vision, which invites other countries to manufacture their products in India and sell them to other countries. The success of this ideology will ultimately envisage a quantum jump in India's global trade.

The railways have  also been asked to come up with a comprehensive plan to facilitate FDI, as a clearance for 100 percent foreign direct investment (FDI) has been granted in their sector.

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Impacts & Initiatives of Shipping for our Environment

Pollution effects are indeed many and wide-ranging. There is no doubt that excessive levels of pollution are causing a lot of damage to human & animal health, tropical rainforests, as well as the wider environment. The impact on the living environment is seen in the form of air, water and soil pollution.

Speaking on water pollution, for all the reasons pinned, shipping has been wrongly blamed as a major contributor. Moreover, set against the land-based industry, shipping is a comparatively minor contributor, overall to marine pollution from human activities. Shipping which transports 90 per cent of global trade is statistically the least environmentally damaging mode of transport, when its productive value is taken into consideration.

However shipping is negatively highlighted for reasons like discharge of ballast water, the noise produced by ships, risk of marine mammals such as whales and manatees being struck by ships causing injury and death. Further, exhaust gases from ships are considered to be a source of air pollution, both for conventional pollutants and greenhouse gases. It is estimated that shipping contributes to about 3.5 to 4% of the air pollution in the world, having gone up from just above 1.5% a decade back.

Most commonly associated with ship pollution are oil spills. Measures introduced by IMO have helped ensure that the majority of oil tankers are safely built and operated, and are constructed to reduce the amount of oil spilled in the event of an accident. Operational pollution caused from routine tank cleaning operations have also been cut.

The cruise line industry dumps greywater and blackwater into the sea every day. Backwater is sewage, wastewater from toilets and medical facilities. Greywater is wastewater from the sinks, showers, galleys, laundry, and cleaning activities aboard a ship.

The International Maritime Organisation - IMO being principally concerned with maritime safety, have over the many years, adopted a wide range of measures to prevent and control pollution caused by ships and to mitigate the effects of any damage that may occur as a result of maritime operations and accidents.

The MARPOL Convention addresses pollution from ships by oil, by noxious liquid substances carried in bulk, harmful substances carried by sea in packaged form like sewage, garbage, and the prevention of air pollution from ships. MARPOL has greatly contributed to a significant decrease in pollution from international shipping and applies to 99% of the world’s merchant tonnage.

Thus measures adopted have shown positive results in reducing vessel-sourced pollution illustrating the commitment of the IMO and the shipping industry towards protecting the environment. In the end it will be advisable to quote that our Planet does not belong to one generation, it is a legacy left behind from one to the other. It is us who need to decide what we wish to leave behind, a world of prosperity or a world of ashes.

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Security Training for Seafarers with Designated Security Duties

In the past, passenger ships have been widely targeted by terrorism at sea, due to the high publicity and large potential demands on exchange for a large number of human lives. However, in recent times pirates have varied their focus and started hijacking cargo ships and taken crew hostage for demanding ransom.

Since the terrorist attacks on the United States in 2001, security has become a major issue confronting the maritime world. At a conference of the International Maritime Organization (IMO) held in December 2002, a new security requirement was introduced for the Shipping Industry, namely the ‘International Ship and Port Facility Security (ISPS) Code’. Initially a lot of companies and training institutes introduced ISPS familiarisation courses to educate their company personal and the seafarers. Later SSO Course became a mandatory course for a seafarer who acts as a SSO on-board. STCW 2010 made it mandatory that any on-board staff with designated security duties needs to be trained and in came STSDSD, DG Shipping approved ISPS course.

STCW introduced mandatory training for Ship Security Officer on 1st January 2008 under Reg VI, Code A-VI/5. Now with the increasing number of Piracy and armed robbery incidents happening in many parts of the world STCW amendment 2010 has made mandatory w.e.f. 1st January 2014 security training for all seafarers with designated security duties, so as to provide them with the knowledge and training to implement procedures to make their ship a more secure place.

The course intends to provide knowledge, understanding and skills to seafarers who will be designated to perform on-board security duties. After the training, the participants shall be able to:

• Know current security threats and patterns.
• Recognize how to detect weapons, dangerous substances, and devices.
• Recognize, on a non-discriminatory basis, of characteristics, and behavioural patterns of persons who are likely to threaten security.
• Know the techniques used to circumvent security measures.
• Understand crowd management and control techniques.
• Understand security related communications.
• Explain emergency procedures, and contingency plans.
• Operate security equipment and systems, e.g. handheld metal detectors.
• Know the procedures in testing, calibration and at-sea maintenance of security equipment and  systems.
• Know the inspection, control, and monitoring techniques.
• Apply the proper techniques in physical searches of persons, personal effects, and baggage.
• Know the methods of physical searches of cargo and ship’s stores.

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Ministry pushes for longterm cargo support from other sectors

With the agreement of GAIL India to use Indian vessels, to carry part of the liquefied natural gas it imports, the Shipping Ministry is pushing for long term cargo support from sectors like petroleum, steel and fertiliser for local shipping companies.

In the recent past, the Ministry held a meeting with state-run companies such as Oil & Natural Gas Corp, Indian Oil Corp, Steel Authority of India and Fertilizer Corporation of India, urging them to give transportation contracts to Shipping Corporation of India or other Indian firms for a period around 5 to 10 years. This move will definitely give the Shipping Industry a boost as the Ministry pushes for long term cargo support from other sectors.

The move is ultimately directed towards encouraging domestic shipbuilding, in line with the present Government's aim of supporting the local manufacturing sector.

A senior Government official was heard commenting that, they are suggesting the PSUs to devise a long-term cost formula based on global freight indices for signing up the contracts with the Indian shipping lines so that no one is at loss. He further stated that banks would easily agree to extend financing to the shipyards for building of the required vessels if there is cargo commitment.

Most of the carriers required to transport liquid and dry bulk cargo, such as very large crude carriers (VLCC), capesize bulkers or Aframax tankers aren't built in India at present and technological expertise will have to be imported.

The shipbuilding sector has been reeling due to oversupply of vessels and a trend of falling demand for cargo due to the global economic crisis. Most companies had either cancelled their new orders or put them on hold.

Mr. Anil Devli, Chief Operation Officer at the Indian Register of Shipping said that, “Japan, Korea and China have promoted domestic shipbuilding by ensuring that the cargo is transported only on their national carriers. We need to support our industry in a similar way,”

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Public Sector Undertakings in India

The government-owned corporations are termed as Public Sector Undertakings (PSUs) in India. In a PSU, majority (51% or more) of the paid up share capital is held by central government or by any state government or partly by the central governments and partly by one or more state governments. The Comptroller and Auditor General of India (CAG) has the power to appoint the Auditor and to direct the manner in which the Auditor shall audit the company's accounts.

 

Post-Independence, India was grappling with grave socio-economic problems, such as inequalities in income and low levels of employment, regional imbalances in economic development and lack of trained manpower, weak industrial base, inadequate investments and infrastructure facilities, etc. Hence, the roadmap for PSUs was developed as an instrument for self-reliant economic growth. The country adopted planned economic development polices, which envisaged the evolution of PSUs. They can be classified as Public Sector Enterprises (PSEs), Central Public Sector Enterprises (CPSEs) and Public Sector Banks (PSBs).

 

On basis of certain performance criteria, CPSEs can attain the status of - Maharatna, Navratna, and Miniratna. These prestigious titles provide them greater autonomy for their board particularly to take investment decision without referring them to their respective ministry and cabinet and help them to compete in the global market.

 

A company having certain performance criteria including profitability over last 3 years and having an average annual turnover of Rs. 20,000 crore with an average annual net worth at Rs. 10,000 crore is categorised under the Maharatna. This status empowers mega CPSEs to expand their operations and emerge as global giants. It also empowers their board to take investment decisions up to Rs. 5,000 crore without seeking government approval. These firms can decide on investments up to 15% of their net worth in a project, limited to an absolute ceiling of Rs. 5,000 crore.

 

The Navratna, status empowers PSEs to invest up to Rs. 1000 crore or 15% of their net worth on a single project without seeking government approval. In a year, these companies can spend up to 30% of their net worth not exceeding Rs. 1000 cr

 

For Miniratna - Category I, the CPSE should have continuously made profit in the last three years and the pre-tax profit should have been Rs. 30 crores or more in at least one of the three years. For Category II, the CPSE should have continuously made profit for the last three years and should have a positive net worth. Miniratnas have autonomy to incur the capital expenditure without government approval up to Rs. 500 Rs. 300 crore or up to 50% of their net worth whichever is lower, respectively depending on their category.

The Government provides Public Sector Enterprises (PSEs/PSUs) the necessary flexibility and autonomy to operate effectively in a competitive environment. The Boards of Navratna and Miniratna companies are entrusted with powers in order to facilitate further improvement in their performance. The Government has also issued guidelines on Corporate Social Responsibility for CPSEs. The PSUs serve the interest of society by taking responsibility for the impact of their activities on customers, employees, shareholders, communities and the environment in all aspects of their operations.

 

 

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Indian Automobile Industry

Automotive industry is the key driver of any growing economy. It plays a pivotal role in country's rapid economic and industrial development. It caters to the requirement of equipment for basic industries like steel, non-ferrous metals, fertilisers, refineries, petrochemicals, shipping, textiles, plastics, glass, rubber, capital equipments, logistics, paper, cement, sugar, etc. It facilitates the improvement in various infrastructure facilities like power, rail and road transport. Due to its deep forward and backward linkages with almost every segment of the economy, the industry has a strong and positive multiplier effect and thus propels progress of a nation. The automotive industry comprises of the automobile and the auto component sectors.

 

In India, automotive is one of the largest industries showing an impressive growth over the years and has been significantly making increasing contribution to overall industrial development in the country. Presently, India is the world's second largest manufacturer of two wheelers, fifth largest manufacturer of commercial vehicles as well as largest manufacturer of tractors. It is the fourth largest passenger car market in Asia as well as a home to the largest motor cycle manufacturer. The sector has shown great advances in terms of development, spread, absorption of newer technologies and flexibility in the wake of changing business scenario.

 

The Indian automotive industry has made rapid strides since delicensing and opening up of the sector in 1991. It has witnessed the entry of several new manufacturers with the state-of-art technology, thus replacing the monopoly of few manufacturers. The norms for foreign investment and import of technology have also been liberalised over the years for manufacture of vehicles. At present, 100% foreign direct investment (FDI) is permissible under the automatic route in this sector, including passenger car segment. The import of technology for technology upgradation on royalty payment of 5% without any duration limit and lump sum payment of USD 2 million is also allowed under automatic route in this sector. The Indian automotive industry has already attained a turnover of Rs. 1,65,000 crore (34 billion USD) and has provided direct and indirect employment to 1.31 crore people in the country.

 

The growth of Indian middle class, with increasing purchasing power, along with strong macro-economic fundamentals have attracted the major auto manufacturers to Indian market. The market linked exchange rate, well established financial market, stable policy governance and availability of trained manpower have also shifted new capacities and flow of capital to the auto industry of India. All these have not only enhanced competition in auto companies and resulted in multiple choices for Indian consumers at competitive costs, but have also ensured a remarkable improvement in the industry's productivity, which is one of the highest in Indian manufacturing sector.

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