The Hindu Business Line : `Strong shippers body at national, regional levels vital'

Shippers' woes
Shipping lines have become powerful through mergers and acquisitions
Containerisation has brought in intermediaries and service providers whose interests are distinct from those of shippers

Kolkata , Aug. 7

A strong shippers' organisation at the national level is now urgently needed to protect shippers' interests and it is important that any move in this regard is backed by the Union Government through announcement of proper policy measures, according to Mr B.R. Chandak, President of Eastern India Shippers Association (EISA).

The Draft Maritime Policy circulated in 2004 was a useful document in the sense that it recognised the need for strengthening the various user interest groups in the maritime sector, he said. He also expressed hope that the comprehensive policy for the maritime sector, which was on the anvil, would take note of the various issues facing the shippers.

Marked changes

Talking to Business Line here recently, the EISA President drew attention to changes in the shipping sector which had made things difficult for shippers. The old conference system had been replaced by new alliances which were functioning as cartels. More importantly, some of the shipping lines, through mergers and acquisitions, had emerged strong and powerful, with the result the shippers were virtually at the mercy of these powerful entities, more so because some of them had also become terminal operators.

Containerisation, he explained, had dramatically changed the pattern of transportation of cargo by sea and a whole range of intermediaries and service providers had emerged in shipping transportation whose interests were distinct from those of the shippers, particularly small and medium ones.

A strong shippers' council at the national level with equally strong regional bodies were, therefore, needed to ensure Indian shippers received fair services at competitive pricing from various services providers including shipping lines and their agents.

Government support

"What I'm asking for by way of Government support is not something new," Mr Chandak said. He pointed out that the Government was concerned with shippers' issues as early as the 1950s and the Freight Investigation of Bureau was set up in 1959 as part of the office of the Director-General of Shipping, Mumbai. In the sixties, several regional shippers' associations as well as the apex body, All India Shippers' Council, were formed, also at the initiative of the Government. Subsequent developments on the shipping front, both internally and internationally, slowed down the shippers' movement with the shippers' bodies having stopped playing any meaningful role. This only hurt the long-term interests of the shippers. The time had, therefore, come to strengthen the institutional support for the shippers at the regional, sub-regional as well as national levels through proper policy measures, he added.