Delhi sets conditions for coastal shipping service

India set a condition of enlisting Bangladeshi insurance companies, which will provide coverage of vessels, with the Indian authority concerned before the launch of a bilateral coastal shipping service, sources said.
But Bangladesh found the condition illogical and termed it a 'big brotherly' attitude of the neighbouring country.
"There is no such example of enlistment of one country's insurance company in another country for providing insurance coverage. It's irrational… I think it's a big brotherly manner," immediate past director general of the Department of Shipping Jobair Ahmad told the FE Friday.
He said insurance companies were providing risk coverage for vessels in the global perspective, not local. So, there was no need for enlistment of any Bangladeshi insurance company with the Indian authority. "But India set it as one of the preconditions," he added.
Mr Ahmad, who handled the issue of bilateral coastal shipping service as the DG of DoS, said some conditions set by the Indian government had been delaying launch of
the much-awaited coastal shipping service.
He also said India wanted Bangladeshi vessels to be classified by the International Association for Classification Society (IACS) or be checked by the Indian Registrar of Shipping before starting the service.
"If we are to use our classified vessels, then what's the use of going for the new arrangement-the coastal shipping service.  Our goods can be carried by other global vessels as is being done now," Mr Ahmad added.
He expressed his apprehension that bureaucratic red tapes in both Bangladeshi and Indian shipping ministries were delaying the launch of the service, though the political governments of the both countries were very much interested in its quick launch.
Mr Ahmad said Bangladesh would soon start negotiation with India to soften these conditions.  According to sources, Bangladesh has only 15 vessels which can meet the Indian River Sea Vessel conditions. The conditions are very close to those of the IACS, which most of the Bangladeshi vessels will fail to comply with.
According to the sources, Bangladesh wants to use its third and fourth class vessels for the coastal shipping service with India. If India does not agree to soften its stance in this regard, the hull, machinery and other equipment of Bangladeshi vessels will have to be renovated to get the IACS classification.
Deputy General Manager of Sadharan Bima Corporation (SBC) Bibekananda Saha in a recent meeting at the ministry of shipping said that the coverage given by the SBC was internationally recognised. Its coverage is good enough anywhere in the world. The low-cost coastal shipping service is the easiest way to carry goods between the two countries.
According to a study of the Asian Development Bank (ADB), once coastal ships start plying, the trade imbalance between the two countries will come down by US$ 1.0 billion.
The coastal shipping service will use three Bangladeshi ports and four Indian ports. The three Bangladeshi ports are Chittagong, Mongla and the newly-built one at Payra. The Indian ports are Paradip in Orissa, Visakhapatnam in Andhra Pradesh, Haldia in Paschimbanga and Kakinada port near Chennai.
In the fiscal year (FY) 2011-12, Bangladesh exported goods worth US$ 498 million against imports worth $ 4.5 billion from India. Presently, the shipments between the two countries are taking place via a third port like that in Singapore or Colombo in the absence of the direct coastal service.
Bangladesh has nearly 2,000 non-classified or M-Class ships, which are unfit to call at international ports. The country has only around 80 fully classified or C-Class ships mostly in the private sector.