Kerala mulls coastal shipping project to link smaller ports with Kochi

A Mumbai-based shipping company has expressed interest in acquiring two ships for coastal shipping services in Kerala. The project aims to divert a portion of containerized cargo from various parts of the state through the International Container Transshipment Terminal (ICTT) to waterways. The state government is considering an incentive policy to promote coastal shipping and expects to shift 20-30% of container freight movements by road to water.

The company expressed interest after conducting a study on container volume shipped from the north and south of the state through the ICTT at Vallarpadam. The company has proposed providing a 50% fuel subsidy to coastal shipping until the project breaks even. The state government had previously provided a subsidy of ₹1 per km/ton, which was later increased to ₹3 per km/ton to promote coastal shipping.

The Maritime Board Chairman NS Pillai stated that a committee has been set up to study how to design an incentive system to cover 50% of fuel costs until the project breaks even. The project is feasible given the planned opening of the Vizhinjam international seaport this year, and it is expected to relieve congestion on national highways, reduce CO2 emissions, and save 20-30% of road transport costs by switching cargo to water.

Source .