Wednesday, August 20, 2008

Shipping Firms Eye Link Between India, Europe

Container shipping firms are starting new direct services from India to Europe to take advantage of strong demand for exporting merchandise to the continent. Port Facing capacity constraints at the Jawaharlal Nehru Port of call: (above) in Navi Mumbai, firms are now turning to Mundra in Gujarat. (Photograph by Ashesh Shah/ MINT) Islamic Republic of Iran Shipping Line (IRISL) has launched a new Indian subcontinent/Europe weekly direct service by linking Mundra Port in Gujarat with European destinations such as Felixstowe in the UK, Hamburg in Germany, Antwerp in Belgium and Le Havre in France.

The Europe container line (ECL) service will take 19 days to ship goods from Mundra to Felixstowe, the first northern Europe port of call on the service. The ECL service made its first call at the container terminal run by the Adani Group in Mundra Port on Wednesday.

“The market is looking bright for Europe,” said Makarand Sardesai, vice-president of operations at Zim Integrated Shipping Services (India) Pvt. Ltd, which operates a weekly direct service from Jawaharlal Nehru Port, or JN Port, in Navi Mumbai, Maharashtra, to European ports in partnership with state-run Shipping Corp. of India Ltd, Kawasaki Kisen Kaisha Ltd, or K Line, and Malaysia International Shipping Corp. Bhd.

India ships about 12,000 twenty-foot equivalent units, or TEUs, a week or 624,000 TEUs a year to European customers. A TEU is the standard size of a container and a common measure of capacity in the container shipping business. Other firms that operate in this sector include Denmark-based Maersk Line, the world’s biggest container shipping company, and its subsidiary Safmarine, CSAV of Chile, Hapag-LloydAG and Hamburg Süd of Germany, Switzerland-based Mediterranean Shipping Co.SA, CMA CGM of France and its unit ANL Container Line. It costs around $1,600 (Rs67,200) to ship a standard cargo container from India to Europe.

The second container terminal at Mundra Port, run by the Adanis, started commercial operations in December with a capacity to handle 1.25 million TEUs a year. The terminal currently handles close to 200,000 TEUs. The other container handling facility at Mundra Port is run by DP World, the world’s fourth biggest container port operator, owned by the Dubai government. The DP World terminal handled 711,549 TEUs in the 12 months to March.

A few years ago, IRISL operated a direct weekly service to Europe from JN Port, but this service was withdrawn because of congestion at India’s busiest container handling port.

“While JN Port is facing capacity constraints, Mundra Port has spare capacity for handling containers, ” said Sandeep Mehta, chief executive officer of Mundra Port and Special Economic Zone Ltd.

Source : LiveMint, 8 August 2008