MSC starts feeder service linking Paradip with Colombo Port under Odisha government’s VGF scheme

Mediterranean Shipping Company S.A, the world’s biggest container line, has launched a shuttle service linking Paradip Port and Colombo Port with a maiden call on Friday, putting the eastern coast port and one of the 12 owned by the Union government, on the container map and help diversify the cargo mix.

MV MSC Tiger F made its maiden call at the Paradip International Cargo Terminal Pvt Ltd, the facility run by J M Baxi Ports and Logistics Ltd at Paradip Port, on Friday and sailed to Colombo with export aluminium cargo of 90 twenty-foot equivalent units (TEU’s) of Vedanta Ltd and 36 TEU’s of Jindal Stainless Ltd.

MSC will make three calls in a month at Paradip Port on the Paradip-Colombo route under its SE feeder corridor service catering to export-import cargo, port officials said.

The MSC service follows an innovative scheme finalised by the Odisha government to attract container lines and facilitate trade from the state, which was hitherto relying on Visakhapatnam and Kolkata/Haldia ports to send and receive container cargo, paying extra costs.

The Odisha government, per the scheme, has agreed to pay MSC $200 per TEU as viability gap funding (VGF) if the export-import volumes during a ship call at Paradip Port falls below the minimum guaranteed volume of 250 TEUs.

A TEU is the standard size of a container and a common measure of capacity in the container business.

On its part, the Paradip Port Authority is offering 75 percent discount in vessel related charges to container lines besides no container scanning charges to boost container traffic. “Henceforth, prospective clients from Odisha will be no more dependent on ports outside the state,”, said P L Haranadh, Chairman, Paradip Port Authority.Since starting commercial operations in 1967, Paradip Port has been mostly handling iron ore, coal and crude oil.

“Our approach was only towards improving the coal, iron ore and crude oil traffic. It is time now to diversify the cargo basket as an estimated 2 lakh TEU’s are available in the hinter-land of Paradip Port. The combined effort of Paradip Port Authority and the Odisha government has yielded results in attracting a reputed container line like MSC to the port. We have a 5 million tonne capacity terminal at PICT which is no less than any other container terminal in the country with a 14.5 metre draft and state of the art machinery to handle container traffic. It is totally underutilized,” Haranadh stated.

The flagging off ceremony of the inaugural service of MSC from Paradip Port was also attended by the port authority’s Traffic Manager G Edison, Deputy Conservator A C Sahoo, Advisor A K Bose, and PICT Terminal Head Rajesh Naik.