India-Myanmar container service runs into trouble in two months post launch

NEW DELHI: The India-Myanmar container service, an offshoot of the government’s Look East Policy, has run into a rough patch just two months into its launch. Questions are being raised over the sustainability of the service, which is riding on a kitty of Rs 14 crore, after it incurred a loss of over Rs 1 crore in its last voyage. Officials say that at this rate, the service will use up all of its contingency funds in the next five months if cargo volumes do not pick up.

Although the service was launched for strategic reasons and the government did not hope to make any profit from it in the first year, officials are now busy drawing up plans to make it more viable in the long run.”While going, we load up to 90% capacity (of the ship), but the return journey is not generating much volumes,” a senior government official said on condition of anonymity.

Shipping Corporation of India, which is running the service, is hoping that import of pulses in December will boost the cargo volumes from Myanmar to India. Among the proposals on board is allowing the ships to offer feeder services between Chennai and Colombo to up its viability.

The service intended to use northern Myanmar to reach into Mizoram and other northeastern states using the Sittwe port in Myanmar, which is located at the mouth of the Kaladan River. “This shipping service is providing for some predictability and regularity to transportation to Myanmar since ships travel on this route only if there is full load,” said Hemant Bhattbhatt, chief executive officer at Hmsa Consultancy Services LLP.

Shipping Corporation’s MV SCI Kamal starts every fortnight from Chennai and travels to Krishnapatnam, Yangon and Colombo before returning to Chennai. The ship has a capacity of 1,200 twenty-foot equivalent units (TEUs).On her maiden call at Chennai, the vessel carried out a throughput exchange of 200 TEUs with imports comprising pulses, timber and furniture, and exports of items such as cement, general cargo and chemicals.

Cargo from the ports on the west coast like Mundra and Jawaharlal Nehru Port, which goes for transshipment at Colombo, is also directed to Chennai for further transportation to Myanmar.

Source: The Economic Times

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