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India’s weakening maritime power

National Maritime Day has come and gone, but the potential of India’s maritime prowess and power is steadily being strangled and eroded. First it was our ships and shipping lines, now it is our ports. What is left after that?

Every year in the first week of April for the past six decades, the Indian shipping industry goes through this great annual event called “National Maritime Day”—now elongated to the “National Maritime Week”. Part of this ritual involves telling young people that entering life at sea is a strange story. In a way, it fits in with the way generations of students in India have been taught to feel inferior about what India was and can be, and instead to feel highly grateful as well as obliged and patronised for life in India courtesy fictional history rewritten for a purpose on how it was the colonial Europeans who brought everything including their so-called civilisation, while looting us of centuries of self-respect, evolution and wealth.

We are used to hearing this in context with most everything—railways, military, postal services, administration, clothes and more—even our philosophies. But when one looks at the history of the maritime skills of the economies of the Indian Ocean in the centuries before the Europeans landed up, then at least one hopes the records will be straightened out. The Indian Ocean economies had ports, shipyards, lighthouses and much more, along with navigational skills that recognised the fact that the earth was round, centuries before the Europeans could even begin to think of such matters.

For example, in the great relocation of Europeans to Australia a couple of hundred years ago, fact remains, the ships and navigators for the voyage from Asia towards the Antipodes were from India. Likewise, it was the navigators and shipping industries of the Indian Ocean economies which opened the sea-lanes for Europe to Asia trade well before anybody else came and ‘cooked’ up stories about ‘discovering’ that the earth was round and making passage around the Capes.

The biggest tribute to the maritime skills that the Europeans acquired from the Indian Ocean areas are even now held on public display at the Nautical Museum in Greenwich, and in not so much public display at the nearby Trinity House, where these truths are not hidden.

In India, however, the same old fiction is dredged up year after year, indoctrinating fresh generations of maritime cadets on how India’s maritime glories began with the sailing of the Indian flag Scindia steamship ‘Loyalty’, purchased second hand, in 1919, courtesy the immaculate benevolence of our then British rulers and the suddenly re-discovered nationalism of some of our domestic royalty.  

The reality playing out is something totally different, coastal shipping in India has almost sunk, international shipping under the Indian flag is being self-strangulated, and official attitudes are ranged between the “we can do nothing” and the “you do your worst we will not change” aspects.

Nothing shows it better than a review of the Enrica Lexie/St Antony episode, which had previously been covered by Moneylife, and the Prabhu Daya/Don2 episode.

The latest updates, briefly, are as follows—and the contrast between the two could not be more drastic.

Enrica Lexie/St. Antony—Still no trace of the Voice Data Recorder (VDR) and no access to the various other data recorders on the ship either. No clarity on who is the real beneficiary owner of the ship. Much fury and arrogance in Italy with reports of Indian origin people and restaurants being attacked, Italian soldiers coming out in protest on the streets in Italy and amazingly, demands that Italian warships/frigates be sent to Kerala to rescue the ship and soldiers, by force. Ship still under arrest at Cochin anchorage and two soldiers in jail with no clarity on who actually ordered the soldiers to shoot and why the ship was so close to the Indian coast, in the first case. Likewise, no clarity on why the ship altered course after the incident and changed destination from Persian Gulf to Suez/Red Sea. But hey, the maritime administration appears to be in a huge tearing hurry to let go the ship.

Prabhu Daya/Don2—Full disclosure by the owners on all aspects of ownership, vessel, cargo and destination, and crew onboard of all data recorders and full access provided. Admission of error, out-of-court settlement and due process for re-verifying certification of vessel and competencies of complement onboard to follow. Master and crew arrested and then released on bail while all possible co-operation is being extended and investigations are not being hampered or influenced. Vessel still under arrest at Chennai. The same maritime administration is not in a hurry to let go this ship.

So what has all this got to do with National Maritime Day, then?

Just this—that the maritime administration of India appears to be still very much rooted in the colonial past, not just in outward appearance where even vice-chancellors and directors of almost defunct maritime training establishments fight each other in court and squabble over issues like who gets which car with what sort of red beacon to be on parity with their counterparts in the directorate general of shipping and the mercantile marine department, but also in the way those offices which will decide the future of Indian maritime issues are run both online as well as in brick and mortar.

Take a look at the directorate general of shipping website, for example, and weep. This is our maritime window to the world. It appears that the sole purpose of this website is to confuse, and therefore to force anybody who has anything to do with the DG Shipping’s offices anywhere, to make personal visits. And we all know what that means.

Directorate General of Shipping

Add to that the simple fact that the Indian National Ship Owner’s Association (INSA) is now more a cosy club of people who have foreign flag ships—while also maintaining a few Indian flag ships. National interest takes a backseat on almost all aspects of maritime issues, and in a manner of speaking, can best be compared to the way the Italians are outraged at their maritime interests being subjected to the due process of law in India. The message is clear—maritime interests of a nation take heavy precedence in Italy and other countries.

The lesser said about the maritime unions, the better. Nobody knows when the last audits were held, how the membership is regulated and who these unions actually stand for. Oh yes, they have a lot of strongmen and heavies floating around.

And then we move on to the really important part—the commercial aspects of maritime trade. The movement of legitimate cargo into and out of the country. Anywhere else in the world, this is a priority sector, where all segments of entities involved work as one for something larger called “national interest”.

In India, it is the other way around, and again it is the reality of container movements in and out of the Kochi port system which provides the best example. Moneylife had written on this subject in the past:

Since this article was published, it appears as though the battle to sell India’s coastal shipping has gone into an even more dangerous downward spiral, and nothing brings this out more than the way the new Vallarpadam Container Terminal is functioning, where cabotage protection is now almost history. In addition, there appears to be open defiance of the Customs Act by the terminal operators, port authorities with the tacit support of the maritime administration support foreign flag vessels, and huge amounts of public money spent on infrastructure development are simply going to waste.

To provide only one example—container loads of banned commodities being smuggled out of the Vallarpadam Terminal (operated by Dubai Ports Worldwide) were sought to be re-examined by the Department of Revenue Intelligence (DRI) and Indian Customs, in October 2011. The port and terminal operators objected, the ministry of commerce backed them and instructed the CISF on duty at the gate not to permit the customs authorities to enter or do anything more than check the seals on the container, until the local police forced the issue in favour of the customs—who have every right to check anything entering or leaving the country—especially if it is totally illegal.

Why would a terminal operator object to customs re-examining a container, unless they had an interest in what is inside the container?

Please understand one more basic concept of shipping—terminal operators, shipping lines, shipping agents and all other intermediaries operate on what is known as a “said to contain” basis—which means, they do not take liability for what goes in or out of a shipment. Often they do not even know the weight on overloaded containers, or whether they contain dangerous cargo, and have to go by the declarations provided.

The provenance of what is inside a shipment is between the shipper and the consignee. Any mis-declaration or resultant issue is not the responsibility of anybody else and as a direct result, terminal operators, shipping lines and agents will bend over backwards to co-operate with the authorities.

Unless, of course, there is some element of connivance and conspiracy between the shipper, consignee and any of the go-betweens, like the terminal operator, shipping line or agents. This, too, is not unknown. So, in the case of containerised cargo, the typical ‘game’ is to point at the one-time lock being used as a container seal, and claim that, look, everything is OK.

But everything is not OK. Containers are sealed using one-time locks on the door handles. As is well known in the trade, as many one-time locks as you want with whatever markings required are available easily without any problems, and there are no reliable or cogent audits on this in the shipping business. Sealed or locked containers can furthermore be easily opened by disengaging the hinges on one side, thereby swinging the door open without disturbing the seals on the other hinges. This is the most open secret in the global container industry, and pilferage or substitution of what is inside a marine container after it has been ‘officially’ sealed is rampant.

A government-operated terminal will co-operate backwards with the authorities. Terminals which are careful about their reputations have a choice. But Vallarpadam? They are loyal, it seems, but to somebody else. Not India.

In this case, it appears that having motivated themselves into a monopoly position and having ensured that the local maritime administration in and around Kochi is eating out of their hands, the terminal operators at Vallarpadam with the support of the local and maritime authorities chose to try and prevent the customs from re-examining the containers.

Why would they do this unless they knew that something was wrong? Can we tolerate this in an independent India?

National Maritime Day has come and gone, but the potential of India’s maritime prowess and power is steadily being strangled and eroded, and that needs to be reversed. First it was our ships and shipping lines, now it is our ports. What is left after that?

(Veeresh Malik had a long career in the Merchant Navy, which he left in 1983. He has qualifications in ship-broking and chartering, loves to travel, and has been in print and electronic media for over two decades. After starting and selling a couple of companies, is now back to his first love—writing.)



Veeresh Malik

2 years ago

Latest update

Italian marines pressurised Captain to cover up

Rambabu Shastri

5 years ago

India should embrace Islamic law. The Italians are off due to the concept of blood money and that is the law in the Gulf.

Capt Bhatia PS

5 years ago

I have been reading the articles on a regular basis as they are informative and to the point. Wish that this information reaches the concerned authorities also, so that some action action is taken for the good concern of all.



In Reply to Capt Bhatia PS 5 years ago

Dear Capt. PS Bhatia, thank you for writing in.

The authorities, especially the maritime administration in India, are fully aware of the mess they are creating and the dangers this poses to the larger picture of India's economic independence. The time now is to be part of the solution and for that i will request that you please do your bit, too, by bringing these issues up at subsequent maritime functions.

Forcefully. Drive the point home to them that we know what they are doing and will not let them get away with things.

Humbly submitted/VM

S Mukherjee

5 years ago

A very informative and relevant article in these times when the Enrica Lexie and St. Antony killing incidents have been in the news. Also really expect and hope the shipping authorities will explain the difference in their reaction/treatment in the above 2 cases as clearly pointed out. As well as urgently rectify the other shortcomings mentioned to act in a more pro-Indian manner as befits our status of an independent sovereign nation with a glorious past maritime history.



In Reply to S Mukherjee 5 years ago

Dear S Mukherjee, thank you for writing in.

We can do our part, howsoever little, by bringing these issues up publicly. As forcefully and often as possible.

Humbly submitted.


Fidelity investors: Exit and reinvest elsewhere

Investors in Fidelity schemes should look for an exit in the 30-day no-load window that will be available to them. Returns of L&T Mutual Fund have been nothing to be confident about

L&T Mutual Fund (MF) recently came into the Indian fund industry, having been setup through the acquisition of DBS Cholamandalam Mutual Fund in 2010. Chola was a running a poor management and investors entering the L&T Mutual Fund fold have not done any better. With the acquisition of Fidelity Mutual Fund, one of the better performing fund houses, L&T MF has become the 13th largest fund house up from 24, out of a total of 43 fund houses currently present. But the sad news for investors in the schemes of Fidelity MF is that the sale to L&T MF does not include the fund management team. Fidelity’s fund management team would be there until L&T MF builds its team to manage the newly acquired assets.

The fund management of Fidelity MF has been much better than that of L&T MF. As seen in the performance compared to the benchmark, the returns of L&T funds have fallen short of the benchmark on a number of occasions, whereas the funds of Fidelity have outperformed their respective benchmarks on all the occasions for the one-year, two-year, three-year and five-year periods ending 31 March 2012. The investors of Fidelity wouldn’t want the L&T fund management team handling their investments seeing this performance of the fund house. Investors who are worried about their investments and those who are doubtful of the fund management team of L&T should look for an exit in the 30-day window given to them where they will be charged no load for exit.


Venugopal Manghat recently joined as vice president & co head - equity investments at L&T Mutual Fund. He was earlier the head of equities at Tata Asset Management. He was the fund manager of Tata Pure Equity and Tata Equity Opportunities—two equity funds of Tata MF which have done well in the past. He took over managing L&T Growth fund from Pankaj Gupta last month. Would he be able to turn around the performance of L&T equity schemes? One would just have to wait and watch. At the same time Shobheta Manglik has joined as assistant vice president & fund manager-fixed income. She has been jointly managing the few of the debt-oriented funds and has an experience of over 10 years. Pankaj Gupta with an experience of over 10 years has been managing three of the equity funds since September 2010 and Anant Deep Katare, who has over nine years of related experience, has been managing L&T Hedged Equity fund and L&T Midcap Fund since October 2007. L&T Mutual Fund would have probably done well had Sanjay Sinha, who came in from SBI Mutual Fund, stuck around. But he joined in September 2008 and quit in August 2011.

Compare this to the current fund management of Fidelity. All the equity diversified funds of Fidelity are co-managed. Anirudh Gopalakrishnan, who has a work experience of over 10 years, is the common fund manager for all the four schemes and has been managing these funds for foreign securities investments since October 2010. He, along with Sandeep Kothari, who has an experience of 17 years, manages Fidelity Equity Fund and Fidelity India Growth Fund and along with Nitin Bajaj, who has an experience of 12 years, manages Fidelity India Special Situations Fund and Fidelity India Value fund. Fidelity does have a more experienced team but unfortunately they would not be managing the schemes once L&T Mutual Fund acquires them.





5 years ago

I feel it is too early to panic and exit. Fidelity has one of the best funds which have given outperformance in the past and have continued performing quite well. I feel an investor at this stage needs to keep an eye on the performance and give some time to it. Anyways the Fidelity team is continuing at this point of time. So as a prudent investor... let us wait and watch.

A Bishnoi

5 years ago

Your comments appear one sided. Particularly when you see the performance chart. The difference of performance between the two managers is marginal at best. Both have outperformed the benchmarks albeit with a slightly different margin. Again, you are totally overlooking the fact that Fidelity is committing its fund managers to L&T for an indefinite period. Clearly there is every intention to see that investors dont lose value. Why would you make a call to exit? I get lots of agents who want to earn commission on the fresh investment, they usually call for exit under slightest pretext...but why you?

Arun T Sawant

5 years ago

Good Update for IFA's and Investors.

Sensex, Nifty to head lower: Monday Closing Report

If the Nifty makes a lower low, we may see the index touching 5,165 and 5,135

Dismal global cues led the market lower for the second day. On one of the lowest volumes of on the National Stock Exchange (NSE) in the past 23 trading sessions (including today), the Nifty made a lower high and lower low for the second straight day today. Today, 50.63 crore shares were traded on NSE. The losses in the last two trading days wiped off nearly 70% of the gains made in the upmove that happened between 30th March and 3rd April. We had mentioned in our previous closing report that Monday’s move would determine the further direction. If the Nifty makes a lower low, we may see the index reaching the level of 5,165 and then to 5,135.

Opening after a long weekend, the market extended its losses on unsupportive global cues. Markets in Asia were in the red in morning trade on a disappointing US jobs report that was released over the weekend and a rise in Chinese inflation. The Nifty opened 40 points lower at 5,283 and the Sensex declined 78 points to resume trade at 17,408.

Select buying enabled the indices to hit their intraday high in initial trade itself. At the highs, the Nifty touched 5,288 and the Sensex rose to 17,408. However, selling pressure in metals, capital goods, power, banking and oil & gas stocks led the market further southwards as trade progressed.

The absence of any triggers and the key European markets remaining closed for the Easter Monday holiday saw the local market moving sideways. A small recovery was seen in the post-noon session; however, intense selling pressure once again pushed the indices lower again.

The market fell to its intraday lows in the fag end of the session. At this point, the Nifty fell to 5,228 and the Sensex dropped to 17,200.

The benchmarks settled near the lows of the day and in the red for the second day in a row. The Nifty closed trade at 5,234, down 89 points, and the Sensex finished 264 points lower at 17,222.

The advance-decline ratio on the NSE was tilted towards the losers at 685:1243.

Among the broader indices, the BSE Mid-cap index dropped 1.35% and the BSE Small-cap index fell by 0.65%.

Barring the BSE Healthcare index (up 0.32%), all other sectoral gauges settled lower. They were led by BSE Metal (down 3.44%); BSE Capital Goods (down 3.16%); BSE Power (down 2.49%); BSE PSU (down 2.05%) and BSE Bankex (down 1.81%).

Cipla (up 1.34%); Hindustan Unilever (up 1.06%); Bajaj Auto (up 0.95%); DLF (up 0.64%) and Bharti Airtel (up 0.12%) were the top gainers on the Sensex. The main losers were Hindalco Industries (down 5.18%); Sterlite Industries (down 4.34%); BHEL (down 3.71%); Larsen & Toubro (down 3.50%) and Jindal Steel (down 3.46%).

The Nifty was led by Ranbaxy Laboratories (up 3.99%); Dr Reddy’s Laboratories (up 2.01%); Cipla (up 1.73%); HUL (up 1.58%) and Bajaj Auto (up 0.96%). The key losers on the index were Hindalco Ind (down 5.41%); Cairn India (down 5.25%); IDFC (down 5.04%); Sterlite Ind (down 4.57%) and Sesa Goa (down 4.49%).

Markets in Asia closed lower as China’s annual inflation rose to 3.6% in March on the back of higher food prices. The disappointing US jobless data also weighed on the markets.

The Shanghai Composite declined 0.90%; the Jakarta Composite shed 0.30%; the KLSE Composite slipped 0.47%; the Nikkei 225 tanked 1.47%; the Straits Times fell 0.87%; the Seoul Composite dropped 1.57% and the Taiwan Weighted settled 1.37% lower. The Hong Kong market was closed for trade today. At the time of writing, the US stocks futures were trading lower, while the markets in Europe were closed today.

Back home, institutional investors—both foreign and domestic—were net buyers in the equities segment on Wednesday. While foreign institutional investors pumped in Rs45.82 crore, domestic institutional investors invested Rs126.70 crore.

Somany Ceramics today said it will acquire 26% stake in Gujarat-based Commander Vitrified Pvt Ltd (CVPL) for Rs3.25 crore. CVPL is at an advanced stage of setting up a new plant to manufacture about 2.65 million square meters of vitrified tiles (polished and glazed) per annum at Morbi (Gujarat). Somany declined 0.86% to close at Rs40.40 on the NSE.

Alstom T&D India has been awarded a contract worth approximately Rs74 crore by Jyoti Structures, a leader in turnkey engineering, procurement and construction (EPC) projects in the field of power transmission. The projects involve supplying power transmission equipment to state-run Power Grid Corporation for two projects. Alstom T&D declined 1.49% to close at Rs179.10 on the NSE.

Godrej Properties, through its wholly-owned subsidiary Godrej Projects Development Pvt Ltd, has entered into a development management agreement with RR Builders for redeveloping a MHADA (Maharashtra Housing & Area Development Authority) property at Byculla, Mumbai.

The project, spread over nearly 2.5 acres, would offer around 3 lakh sq ft of free saleable area. It is proposed to be developed as a residential project having 2, 3 and 4 BHK apartments. Godrej Properties closed 0.83% lower at Rs613.40 on the NSE.


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