Local agents of container lines serving Mumbai strongly protested a planned 30 percent increase in tariffs.
The management of India’s western Port of Mumbai filed an application with the Tariff Authority for Major Ports, the country’s port regulator, to hike its existing scale of rates by 30 percent as part of a general tariff revision.
The Mumbai-Nhava Sheva Ship Agents’ Association said in a communique to the authority that the port’s submissions are not justified as current rates are exorbitantly higher compared to other major ports.
“If the tariff scale at Mumbai Port is to be revised without going into its cost factors, then there will be heavy additional burden on ship owners/their agents, and there is every likelihood of the trade getting shifted elsewhere where operational costs to vessels, along with productivity and turn-round, will be much better,” said the agents’ group.
They argued that in comparison, tariffs at the Port of Kandla are significantly lower; by nearly 15 percent for vessel-related and as much as 60 percent for cargo-related charges; attributing to an overall 45-percent saving on operational costs.
The group, which represents the entire agents' community at the ports of Mumbai and Nhava Sheva (Jawaharlal Nehru), called on the authority to turn down the proposal as any additional costs would place severe pressure on carriers' operating margins amid slumping cargo volume and freight rates.
Mumbai, one of India’s oldest ports, is a leading general cargo handler, having racked up throughput of 40.4 million tons during April-December compared with 38.6 million tons a year earlier. Its container traffic has declined drastically over the last ten years due mainly to serious infrastructure constraints, particularly lack of modern equipment and shallow draft. Volume for the April-December period dropped to 41,162 20-foot equivalent units from 77,349 TEUs.