The Government is going ahead with plans to commence vehicle imports from the Hambantota port from next March despite strong opposition from importers, who made their concerns known at a meeting on Monday with the state.
Authorities state that currently they are negotiating with at least one operator for transshipment to be carried out from the Hambantota port. This vessel will be carrying vehicles shipped from Japan, China, India, and Korea with some of these likely to include vehicle imports to Sri Lanka as well.
Sri Lanka Ports Authority (SLPA) Chairman Dr. Priyath Bandu Wickrama told the Business Times on Wednesday that this vessel would bring in vehicles to the Hambantota port and will carry out transshipment from this point where facilities related to monitoring of the work, office, repairs, and audit will be provided by the SLPA.
In this respect, part of the operations for vehicle imports will be carried out from the Hambantota port as well in the future.
It was pointed out however, they did not intend on closing down operations for Colombo either but noted that those willing to shift can do so.
“If we decide to shift they will have to do so,” Dr. Wickrama asserted adding that those in Colombo must understand the situation and growing problem concerning congestion at the Colombo port.
Noting this move is carried out in the “national interest”, he said that “one day they will have to shift,” referring to vehicle importers in the island.
Congestion at the Colombo port is said to be on the rise since the latter part of 2010 when the government slashed the duty on vehicle imports generating an increased demand resulting in higher volumes needed to be maintained at the port.
In addition, the ongoing internal works on road expansion within the port has also resulted in a further squeeze on the space available for parking vehicles at this location, Dr. Wickrama said.
It was further pointed out that with an increased number of vessels calling at the Sri Lankan ports it will result in a possible decline in freight rates adding that this surge could be brought about by ensuring vessels carry out transshipment from this location.
Ceylon Motor Traders Association President Tilak Gunasekara observed however, that the industry will suffer heavy losses running into millions due to high variable costs if they are to shift to Hambantota.
He noted the industry was not positive on this matter and had in this respect called for a meeting with Dr. Wickrama last Monday that allowed them to, for the first time, discuss the issue with the government.
Further, it was pointed out that while authorities understood the situation there was no decision reached at the conclusion of the meeting.
Mr. Gunasekara pointed out that importers will face the issue of bringing down vehicles to Colombo from Hambantota that will result in a huge additional cost.
Moreover, with no pre-delivery inspection (PDI) carried out at the Hambantota port it will become a key issue concerning the granting of warranty from the principal (import source) on the vehicle.
The industry points out that while they were saddled with additional costs the Government’s plans might only force them to pass on this cost to the customer as they will be unable to absorb it. This will effectively result in vehicle costs increasing further in the future, he pointed out.
Authorities however, noted that they intend on carrying out several discussions with importers, shipping lines and car carrier agents together following which they hope to arrive at a decision. |
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