India’s Ports to Allow Free Storage Time During the Lockdown

Government suspends imposition of penalties for delays in loading, unloading, or evacuation of cargos


The Ministry of Shipping (MoS) has issued a notice directing all major ports of the country to allow free storage time to all port users for the lockdown period. India is currently on a nationwide lockdown until May 3, 2020, to arrest the spread of the coronavirus pandemic.

The present situation has led to a drop in import and export volumes, delays in the evacuation of cargo, and cash flow issues.

Under the remission of charges to port users, the Ministry has directed the ports to allow deferment of annual lease rentals or license fees on a pro-rata (proportionate) basis without any interests for April, May, and June. However, this can be availed only on request from the lessee or licensee.

Further, the MoS has stated that ports should ensure that no penalty charges, demurrages, detention charges, dwell time charges, anchorage charges, berth hire charges, and performance-related penalties are to be levied on any port for the delay in berthing, loading/unloading operations or evacuation or arrival of cargo during the lockdown and another 30 days of the recovery period.

According to the new guidelines, if additional land is available within the port area, the port should make all efforts to provide additional storage land to port users temporarily. The Ministry has also pointed out that all these should be provided without any charges up to June 30, 2020.

Additionally, the ports are directed to extend the public-private partnership (PPP) concessionaries. Ports have been asked to allow deferment of revenue, royalty, and equipment hire charges without any interest in April, May, and June 2020. The charges due in April 2020 will be paid in August 2020 or through six-monthly equated installments.

The Ministry has also asked the ports to allow waiver of lease rentals, license fees, and similar charges for April, May, and June 2020.

Further, the ports have been asked not to levy any penalty for any shortfall in performance standards such as berth output, transit storage, or turnaround time for the lockdown period, and one month of the recovery period.

For now, ports will allow interest-free 60 days deferment of marine dues or vessel-related charges to the Indian coastal vessels. For this, the ports will obtain the bank guarantees as security from coastal vessel operators. However, only deferment requests received by May 30, 2020, will be considered.

The notification further added that all ports are to remain operational during the COVID-19 pandemic despite the force majeure declarations.

Given the situation arising due to the COVID-19 outbreak, the Ministry has directed the ports to extend the completion period of any project under the PPP model or otherwise.

All major port trusts have been asked to issue orders for both remission and force majeure in their respective ports and submit them to the Ministry of Shipping within seven working days from the date of the issue of the order.

In April 2020, Mercom reported that the Ministry of Shipping issued its first notice to major ports with directions to deal with issues caused due to the Coronavirus outbreak.

Earlier, the Directorate General of Shipping (DGS), Mumbai, had issued an advisory to shipping lines asking them not to impose any container detention charges on import shipments at Indian seaports to maintain proper supply lines in these tough times.

In a recent online survey conducted by Mercom India Research, almost 70% of the respondents said their business would be affected by over 15% because of the Coronavirus, while 83% of the survey participants expect solar component supply shortages because of Coronavirus. The Coronavirus pandemic is proving to be the solar industry’s biggest challenge this year, and the repercussions are being felt across industries all over the globe. Read Mercom’s in-depth report here.

According to several developers, even though ports are clearing the materials, there are no workers to transport the materials. According to a government official,  about 6-7 GW worth renewable energy components are currently stuck in Chinese ports.

Image credit: Adam Jones from Kelowna, BC, Canada / CC BY-SA

Anjana is a news editor at Mercom India. Before joining Mercom, she held roles of senior editor, district correspondent, and sub-editor for The Times of India, Biospectrum and The Sunday Guardian. Before that, she worked at the Deccan Herald and the Asianlite as chief sub-editor and news editor. She has also contributed to The Quint, Hindustan Times, The New Indian Express, Reader’s Digest (UK edition), IndiaSe (Singapore-based magazine) and Asiaville. Anjana holds a Master’s degree in Geography from North Bengal University, and a diploma in mass communication and journalism from Guru Ghasidas University, Bhopal.