Narendra Modi government identifies 5 ports to boost cruise tourism

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Union minister for shipping Nitin Gadkari on Tuesday announced that the government has identified five major ports — Mumbai, Mormugao, Mangalore, Chennai and Cochin — to boost cruise tourism in India.

While the number of Indians who took a cruise in 2016-17 was 2 lakh, the number could go up to 40 lakh, according to a report prepared by consultants Bermelo & Ajamil jointly with Ernst & Young. Of this, 80% or 32 lakh passengers are expected to take cruises from the Mumbai port alone.

However, Gadkari added that the cruise tourism industry is facing challenges on many issues and that he would make a representation to the finance ministry to waive the goods and services tax (GST), levied at 5% currently on all cruise ships, as well as establish a zero income tax regime.

While the largest cruise line operator, Carnival PLC, is looking to increase the number of cruise liners in India, David Dingle, the company’s chairman told FE that the country must create a domestic cruising tax regime competitive with tax regimes elsewhere in the world.

“In principle, the cruise industry will not come to a part of the world where it has to pay GST on the ticket price and on the sales made on board. We will not bring our ships here in any significant numbers all the while that cruising attracts any GST,” he said. Moreover, Dingle added that international cruise companies have to have the right to repatriate their profits through double tax treaties.

Carnival PLC sold 181,000 cruises in India in 2016, registering a compounded annual growth rate of 31%.

Current estimates are that over 120,000 Indians book a cruise each year with over 90% of them travelling to Singapore to board a cruise liner. To cater to this growing market, the Indian government wants to increase the number of cruise liners that come to India, eliminating the need for cruise seekers to fly abroad to board a ship.

The Indian coastline saw 150 cruise ship visits in 2016 and the government is aiming to increase this to about 955 in the next few years.

Source: http://www.financialexpress.com/industry/narendra-modi-government-identifies-5-ports-to-boost-cruise-tourism/799965/

Tamil Nadu to get 4th major port

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The Cabinet on Tuesday approved the setting up of a major port at Enayam near Colachel in Tamil Nadu. This would be the country’s 13th major port.

Colachel is about 50 km north-west of Kanyakumari.

India has 12 major ports — Kandla, Mumbai, JNPT, Marmugao, New Mangalore, Cochin, Chennai, Ennore, V O Chidambaranar, Visakhapatnam, Paradip and Kolkata (including Haldia). These handle approximately 61 per cent of the country’s cargo.

A special purpose vehicle (SPV) would be formed for the development of Colachel port, with an initial equity investment from the three existing major ports in Tamil Nadu — V O Chidambaranar Port Trust, Chennai Port Trust, and Kamarajar Port. The SPV would develop the port infrastructure, including dredging and reclamation, construction of breakwater and ensuring connectivity links, a statement said.

Fishermen in the coastal villages of Tamil Nadu have been opposing construction of this port, fearing sea erosion and loss of livelihood.

India has few ports with sufficient draft to match global cargo handling efficiencies. All of India’s trans-shipment (transfer of shipment from one carrier to another during transit) traffic is handled in Colombo, Singapore and other international ports. Indian port industry loses up to Rs 1,500 crore of revenues each year, the official statement said.

This major port at Enayam will act as a major gateway container port for Indian cargo now trans-shipped outside the country. It would also reduce the logistics cost for exporters and importers in south India, who depend on trans-shipment in Colombo or other ports, incurring additional port handling charges.

Minister of Shipping Nitin Gadkari had in April said the government had plans to add eight major ports in the country — including at Wadhawan in Maharashtra, Sagar in West Bengal and Colachel in Tamil Nadu.

 

Source: http://www.business-standard.com/article/economy-policy/tamil-nadu-to-get-4th-major-port-116070501191_1.html