Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — The Great Eastern Shipping Company — Indian Coastal Conference 2001
17 slides from Great Eastern Shipping's conference presentation, Dec 15, 2001
Slide 1: Golden Jubilee Celebrations Indian Coastal Conference
Golden Jubilee Celebrations INDIAN COASTAL CONFERENCE Presentation by Mr. Vijay K Sheth Managing Director The Great Eastern Shipping Company Ltd. 15 December, 2001
Slide 2: Shipping Sector today encompasses the entire spectrum
Shipping Sector today encompasses the entire spectrum - international shipping , coastal shipping and inland waterways each charting its own navigational channels Role of Coastal Shipping in India is accentuated due to : - efficacy of transportation - economic interests - energy security - strategic
Slide 3: Constituents of Coastal Shipping
Constituents of Coastal Shipping • Passenger Transportation • Cargo Movement dry, wet,container - Self propelled - Non propelled vessels- barges etc • Oil Field Services - Drilling rigs (self propelled drillships & semi submersible rigs, non propelled drill barges, jackups & submersibles) - support
Slide 4: An international perspective to Coastal Shipping
An international perspective to Coastal Shipping • Countries worldwide including the most developed, have a well defined statute on Coastal Shipping • Adaptive Cabotage laws/ practices (indicative.): - Jones Law of total protection (US) - Mandatory local crew (Norway & Australia ) - Flag preference
Slide 5: Impediments
IMPEDIMENTS
Slide 6: Regulatory
Regulatory • Absence of long term policy framework • Restrictive MS Act,1958 dissonant with the spirit of Cabotage and demands of growth in varied sectors • Indian Customs Act, 1962 results in ambiguity in definition of territorial boundaries • Unreasonably high safe manning levels (e.g.50% for tugs
Slide 7: Fiscal
Fiscal • Higher corporate tax rates at 35.7% as against low tax regime for the foreign counter parts • Applicability of Customs Duty (5%) on tug acquisitions and (65%) on spares • Differential depreciation rates • Discriminatory taxation on Indian seafarers’ salaries - shifting of talent pool to for
Slide 8: Allied
Allied • Lack of Industry stature and recognition though a forex saver and employment generator • Port inefficiencies effecting growth of coastal trade • Lack of hinterland transportation ( rail & road ) connectivity to major/minor ports • Sea time during coastal voyages not recognised
Slide 9: Major Cost Disadvantages to Indian Flag Vessels
Major Cost Disadvantages to Indian Flag Vessels * • On Acquisition Cost : Cost of finance impacted by country rating • Manning Costs(except crew accommodation) Tanker Dry Bulk Container ATHSV Tugs Numbers 9 6 5 3 3 Wage bill 300 260 553 130 80 $ /day • Customs Duty on additional equipment's ($) Cont
Slide 10: Solutions
SOLUTIONS
Slide 11: Regulatory
Regulatory • A comprehensive National Policy/Act on Coastal Shipping addressing every constituent of Coastal Shipping – Passenger Movement – Cargo Transportation – Oil Field Services – Port Flotillas • Broadbasing provision of Cabotage • Renewal of Indian Customs Act 1962 • Rationalisation of safe m
Slide 12: Fiscal
Fiscal • Adoption of tonnage tax regime • Employment in Coastal Shipping to be treated at par for Income Tax applicability in case of seafarers employed outside India • Enhanced depreciation rates • Rationalisation of Sales/Lease/Service tax • Fiscal incentives to induce investments and increase par
Slide 13: Allied
Allied • Industry status to Coastal Shipping • Dedicated berths at ports for coastal vessels • Simplification of customs procedures
Slide 14: Imperative Action Sought!
Imperative Action Sought ! • Need for Government to take a pragmatic approach to issues pertaining to coastal shipping and outline a policy framework to create level playing conditions for Indian flag vessels vis-a-vis foreign flag vessels. • Critical need for creating a conducive operating environm
Slide 15: Navigation Chart
Navigation Chart • Quick action on policy formulation • Strengthen the Regulatory Authority • Correctly emphasize the scope of Coastal Shipping • Adopt policies to stimulate the sector • Fiscal incentives • Level playing field by giving first right of refusal to Indian flag vessels versus foreign fl
Slide 16: Looking forward to .....
Looking forward to ..... • Self Reliance – Technological expertise – Foreign Exchange Saver – Employment Generator – Development of ancillary sectors • Energy Security – Development of Oil / Gas field services • Fortified second line of Defense • Extension of Indian Coastal Shipping operating on for
Slide 17: Thank You
THANK YOU
The Great Eastern Shipping Company — Indian Coastal Conference 2001 on 6ix