From: Venugopal Kaikulath (venu1005@hotmail.com)
Sent: Wednesday, September 26, 2007 10:51:31 PM
To: balakrishnan hariharan (hbalakrishnan@yahoo.com)
Cc: kalyan97@gmail.com
Respected Balakrishnanji,
Has the time come to talk about a new bridge from Rameswaram to Talaimanar? The idea of driving to Sri Lanka in less than an hour over the magnificient sea might be just the thing to bloster tourism in the area, increase trade and all that stuff. And an actual physical link to Sri Lanka. But for it to inspire the DMK wallahs enough to forget the canal, Colombo has to agree to autonomy and non interference in Tigerland. Then it will be a bridge from Tamil land to Tamil land. Sound proposition? Or would it be a case of trying to catch the tiger by the tail?
Regards
Venu
Date: Tue, 25 Sep 2007 17:55:49 -0700From: hbalakrishnan@yahoo.comSubject: RE: SETHUSAMUDRAM SHIPPING CHANNEL PROJECTTo: venu1005@hotmail.com
DEAR SIR,
NAMSKARAMS.
I regret to state that 'NO RELIGNMENT' is going to make the SSCP 'economically viable' with the present Qualitative Requirements especially the '12 Metres' dredged depth. That rules out vessels of tonnage in excess of 32,000 to 34,000 Deadweight Tonnage (DWT). And,its not worth paying 'high pilotage rates' to save a 'few hundred miles' in voyage distances!! No sir!! SSCP MAKES NO NAUTICAL SENSE.
NAMSKARAMS
WARM REGARDS
CAPT(RETD) H.Balakrishnan,I.N.
RE: SETHUSAMUDRAM SHIPPING CHANNEL PROJECT
From: Venugopal Kaikulath (venu1005@hotmail.com)
Sent: Tuesday, September 25, 2007 9:05:07 PM
To: balakrishnan hariharan (hbalakrishnan@yahoo.com)
Cc: kalyan97@gmail.com
Respected Capt. Balakrishnanji,
I am grateful to you for responding to me and I feel honoured to read such a well-written, precise, convincing and researched article by you in the Indian Express. It has come as a great relief to me that the Navy is unlikely to go nuts demanding completion of the Project regardless of what comes in the way, Ram's sethu or even Hanumanji himself! I was worried that the anti-Ram forces in India might get the Navy to push for the project and propagate that the project above all is vital for our defence purposes. After reading your article, I can see that the Navy has no reason to be excited about the project. I will soon be reading Priyanka Narain's article also. Maybe in the end I think it will boil down to alignments. Respected Sir, please pour over the various alignment proposals and see if we can have both the project (even if it turns out to be a white elephant) and Ram Sethu. The stubborn Minister Baalu is saying no realignment is possible. I am sure your capacity for incisive assessment can call the Minister's bluff. Congratulations for your solid contribution to saving Ram Sethu. Looking forward to reading many more of your essays. With best wishes,K.VenugopalMumbai
Date: Mon, 24 Sep 2007 18:53:04 -0700
From: hbalakrishnan@yahoo.com
Subject: SETHUSAMUDRAM SHIPPING CHANNEL
---------------------------------------------------------------------------------------------------------------------------------
DEAR SHRI VENUGOPAL,
1. Ref. your mail to Shri Kalyanaraman, above. The same was 'forwarded' to me by Shri Kalyanaraman.
2. I am a reitred Indian Naval Officer and have also served as a Master Mariner in the Merchant Navy. Of my own interest as a mariner,I had researched into the Sethusamudram Shipping Channel Project, purely from a 'mariner's perspective'. My conclusions,in a word is "THE SETHUSAMUDRAM SHIPPING CHANNEL PROJECT MAKES NO NAUTICAL SENSE". My research (a THREE PART PAPER) was published by 'THE NEW INDIAN EXPRESS' in its Chennai and other Southern editions on 25, 26 and 28 MAY 2007.I am enclosing the same for your reading please.
3. Media reports indicate the Indian Navy was NOT CONSULTED in this Project from the security standpoint. However, I informally understand that SHRI Subramanian Swamy has enclosed my paper as an enclosure in his letter to the Union Defence Minister in mid-June 2007. I am sure that the Ministry of Defence would have forwarded the same to NHQ for its comments.I am not aware the official stand taken by NHQ. Informally,I understand that the senior echelons of the Navy are in agreement with my findings!!
4. NDTV 24X7 and CNN-IBN have recently carried my views on the SSCP in theor programmes.May I also request you to please read a 4 PART SERIES published by the daily MINT last Tuesday,Wednesday,Thursday and Friday.It was written by thier journalist Ms.PRIYANKA NARAIN.You can access it over the NET as follows:
(a)- Go to www.livemint.com
(b)- When the page opens, please type 'Sethusamudram' in the 'search' column and click on 'go'.
(c)- The google page will now open and you can access Priyanka's Articles.
NAMASKARAMS
WARM REGARDS
CAPT(RETD) H.Balakrishnan,I.N.
"ATHREYA"
A1/8-FLAT-5
22nd CROSS STREET
BESANTNAGAR
CHENNAI-600 090
TEL: (044) - 24910140
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Part 1 of 3
THE SETHU SAMUDRAM SHIP CANAL PROJECT - (SSSCP)
–A MARINER’S PERSPECTIVE
By
Capt (Retd) H. Balakrishnan, I.N
INTRODUCTION
1. The SSSCP is an off-shore shipping canal project in the Palk Bay. It plans to cut short the distance navigated by ships sailing from the West coast of India and bound for ports on the Eastern seaboard and vice versa, by precluding the necessity to circumnavigate around Sri Lanka.
2. The total length of the SSSCP in the Palk Bay is 152.2 Kms. It is divided into three legs. The Southern leg in the Adam’s Bridge area is 20 Kms. The Northern leg in the Palk Strait area is 54.2 Kms. The Central portion is 78 Kms. Dredging is to be carried out in the Southern and Northern legs to maintain a dredged depth of 12 metres. This would facilitate a navigable channel for ships with a draught of upto 10.7 meters. The canal will be 300 meters wide.
3. The basic justification advanced in favour of the project is that it will reduce the sailing distance between Kolkata and Tuiticorin by 340 nautical miles and between Chennai and Tuiticorin by 434 nautical miles. This enables savings in fuel costs and sailing time, for ships plying between these ports.
4. This paper aims to analyse the viability of the SSCP against the canvas of the following factors that have a bearing on shipping:
(a) Environmental Factors
(b) Security Implications
(c) Navigational and Allied Factors
ENVIRONMENTAL FACTORS
Tropical Cyclones
5. The India Meteorological Department has assigned the Palk Bay area as a ‘High Risk Area’ for cyclonic activity. The cyclone season in the Bay of Bengal is generally between Oct to Jan. It is interesting to note that the IMD’s records from 1891-2001, states that of the 452 cyclones that hit the Indian coastline, 256 were on the East coast. We mariners, in a lighter vein, refer to the Tamil Nadu coast between Rameswaram and Cuddalore as the ‘cyclone coast’!! There are valid reasons for this quip. Of the 256 cyclones referred, 64 have crossed the Tamil Nadu coast in this period. Of these, 36 were ‘severe cyclones’ (winds in excess of 90 Kmph). More interesting, of these cyclones, SIX have crossed the Palk Bay, 14 have crossed the coast at Nagapattinam and THREE have crossed the Gulf of Mannar. All these cyclones can have a devastating consequence on the SSCP and shipping in the area.
6. A few more examples of the devastating consequences of these cyclones, will be illustrative:
(a) In Dec 1964, a cyclone washed away the Pamban Bridge.
(b) In Dec 1973, FIVE metres high tidal waves hit the Palk Bay area – the very
same area where the SSSCP is to be dredged!!
(c) In Dec 1977/78, under the influence of a severe cyclonic storm that crossed the
coast near Nagapattinam, 120 Kmph winds were recorded in the Palk Bay area.
(d) In Nov/Dec 1997/98, an oil-drilling ship, anchored with SIX anchors in the
Cauvery Basin, broke loose from her anchors and was washed ashore by a cyclone.
7. The foregoing will serve to illustrate the fact that the Bay of Bengal cyclones pose a ‘clear, live and present danger’ to ‘Safety of Lives at Sea’ (SOLAS). And, the SSSCP is sought to be created in a ‘cyclone danger area’!!
Siltation
8. Allied to the cyclonic activity in the area, is the problem of siltation leading to a loss of sea depth. scientists have concluded that the Palk Bay area is one of the FIVE areas, off the Indian coast, where siltation takes place regularly. Some of their calculations have indicated a loss in sea depth of about 1 cms every year. It is pertinent to state that TWO of the LEGS of the SSSCP, where dredging is to be undertaken, happen to cross two such micro regions where high siltation takes place.
9. To conclude, the environmental factors of cyclonic activity and siltation rates in the Palk Bay area, impinge on shipping safety. It is also appreciated that maintenance dredging may have to be undertaken through the year to maintain dredged depths. This could lead to substantially increasing the costs of the SSSCP.
SECURITY IMPLICATIONS
Global Scene on Maritime Terrorism
10. While terrorist attacks are predominantly land based, non-state actors have also sought to exploit vulnerabilities in shipping, ports and the container supply chains in Asia, Middle- East, Europe and North America.
11. Conventional arms trade and smuggling, both highly profitable global businesses, are spreading increasingly sophisticated conventional weapons to non-state actors, including long- range anti-ship missiles, unmanned aerial vehicles and close range armour piercing missiles and rocket propelled grenades. All these weapons are capable of inflicting serious damage to ships.
12. The list of foiled, failed and successful attempts in maritime related terrorism over the past decade is significant. Yet, there is a tendency to overlook or downplay what has happened, and thus ignore the possibility of further trouble. It is clear that terrorists can see the potential of using the maritime trading system and its land links in the container supply chain to conceal weapons or agents for attack purposes. Two recent examples of terrorist attacks on naval warships help illustrate the point.
13. Attack on the U.S.S. Cole. In Oct 2000, Al-Qaeda operatives in Yemen, packed a small boat with explosives and rammed the same onto the U.S. Navy destroyer, U.S.S. Cole, while the ship was in harbour. The blast left a gaping hole on the side of the destroyer and the cost of repairs amounted to USD 250 million. The blast killed 17 U.S. Naval sailors and, wounded another 40 seamen.
14. Missile attack on Israeli Naval Ships. On 14 Jul 2006, two days after hostilities between Israel and the Hezbollah commenced, the latter fired TWO, C-802 radar guided cruise missiles from ashore in Lebanon, at Israeli naval vessels patrolling off the Lebanese coast. One missile seriously damaged an Israeli naval corvette. The second missile narrowly missed another corvette. Instead it hit a Cambodian registered merchant vessel, sinking it with eleven hands on board.
The LTTE Factor
15. The LTTE factor has a direct bearing on the safety of shipping navigating through the SSSCP. The LTTE has control over most of North Sri Lanka coastal region and the seas contiguous to it. The Sea Tigers, the naval arm of the LTTE, have displayed considerable ingenuity and daring in sea borne insurgency. They have carried out numerous daring attacks on Sri Lankan naval ships, and have not hesitated in resorting to suicide missions. It is pertinent to note that the SSCP is a ‘next-door-neighbour’ in the area of operations of the Sea Tigers!!
16. A new addition to the LTTE’s fighting capability is its ‘Air Arm’. They have to-date carried out three daring ‘night attacks’ on Sri Lankan assets. This factor adds a new dimension to the threat perception along the SSSCP.
17. Reports in open source literature indicate that the aircraft deployed by the LTTE Air Force is the Czech manufactured ‘ZLIN-Z 242 L’ aircraft. These appear to have been purchased from a private South African flying club. The aircraft is delivered in a knocked-down condition and can be easily smuggled as automobile parts or components of heavy commercial vehicles. By all accounts these aircraft were ferried by sea using forged Bills of Lading. This corroborates Para 11 above.
18. Reports also indicate that the flying training for the LTTE’s pilots was carried out by the same South African flying club. It is also suspected that armament training were carried out by mercenaries in South Africa. All the air attacks on Sri Lankan assets todate have been at night, indicating a high degree of proficiency. The SSSCP falls within the radius of operation of these aircraft!!
19. Media reports of 28 Apr 2007 in Chennai, attributed the recent killings of the TN fishermen at sea to the LTTE Sea Tigers. The grounds for the killings, attributed to LTTE sources, were that these fishermen were ‘spying’ on the LTTE’s activities at sea!! If that be the case, the possibility of the LTTE advancing the same argument for attacking ships navigating through the SSSCP cannot be ruled out. The consequences of a ship sinking in the canal could have a disastrous impact on the viability of the project itself. It would have a psychological impact on the shipping industry which may then tend to avoid the SSSCP and circumnavigate Sri Lanka in the larger interests of safety of men and material.
NAVIGATIONAL AND ALLIED FACTORS
20.The official website of the SSSCP states: “ Ships originating in the West of India and destined for Chennai, Ennore, Vishakapatnam, Paradeep, Haldia and Kolkata have to travel around the Sri Lankan coast resulting in increase of travel distance and time. Apart from this ships belonging to the Indian Navy and Cost Guard need also to traverse around Sri Lanka- - “ .
Navy and Coast Guard
21. The website statement about the Navy and the Coast Guard would give the impression Naval/Coast Guard ships sail to and from either coast on a frequent basis. In reality this is not the case.
22. The navy has been operating on a ‘Two Fleet’ concept for over three decades, to safeguard our maritime interests on the Eastern and Western seaboards. New induction ships are allotted to both Fleets to maintain the required Force Levels on both coasts. Thus the requirement for ships to cross over to the other coast is more the exception than the rule. At the most, they may meet annually for a combined Fleet exercise programme.
23. Besides, peacetime sailings of the Fleet are to hone skill levels in battle-manoeuvres, missile and gun firings, submarine exercises, aircraft operations and underway re-fuelling exercise at sea. All these and other exercises are conducted in areas far removed from the coastal and international shipping lanes for obvious reasons. Under these circumstances and considering the security implications in the area contiguous to the SSSCP, it is debatable whether a Fleet would prefer to navigate through the SSSCP. Also, if the Fleet happens to be a carrier battle group, availing the SSSCP route can be almost ruled out, on account of various tactical factors.
24. During the period of hostilities, it is improbable that ships on passage to either coast would navigate through the SSSCP as it militates against the basic principles of naval operations of avoiding straits and narrows to maintain secrecy of deployment.
25. Similar arguments can also be advanced on the deployment of Coast Guard vessels.
Mercantile Marine
26. It must be borne in mind that the SSSCP is not an ‘open seaway’. Thus for ships to safely traverse through the canal, it will be mandatory to embark a ‘pilot’. A ‘pilot’ is a mariner with experience pertaining to local conditions. He would normally board a vessel at either extremity of the canal and take the vessel safely to the other extremity before disembarking. It is not clear at the present juncture, whether vessels calling at the SSSCP will have a ‘pilot’ boarding on arrival. Delays in the boarding of the ‘pilot’ will entail the vessel to anchor and await the ‘pilot’. Under adverse weather conditions this is not a comforting thought to a mariner. Besides, during cyclonic weather, sea conditions may preclude the embarkation of a ‘pilot’. What does the vessel then do?
27. Open source literature on the SSSCP indicates that vessels upto 32,000 DWT can navigate through the canal. However, in the current global shipping scenario, to reduce the operating costs and cater to the enormous growth in shipping needs, trends are towards operating vessels of 60,000 DWT and above. This trend is likely to grow further in future, resulting in vessels of larger tonnage. A passage along the international shipping lane from South of Sri Lanka to South of the Great Nicobar Island will prove this point. None of these large vessels can avail of the facility of the SSSCP.
28.This would leave the coal carrying bulk carriers on charter to the TNEB, the only ships that would use the SSSCP on a regular basis. These vessels load coal at Haldia/ Paradeep/ Vishakapatnam and discharge the same at Chennai and Tuiticorin for the Thermal Power Plants. Besides, some smaller container feeder vessels from Colombo and bound for Chennai could also use the SSSCP.
29. In the opinion of Mr. K.S. Ramakrishnan, former Deputy Chairman of Chennai Port Trust and former Managing Director of the Poompuhar Shipping Corporation, the pilotage costs of navigating through the SSSCP and certain allied factors, could make the SSSCP unattractive to the shipping industry. It is his opinion that the actual use of the SSSCP maybe substantially lower than the projected figure of 3417 vessels by 2010 and 7141 vessels by 2025.
CONCLUSION
30.A report in the magazine ‘Frontline’ of 01 Jan-14 Jan 2005, entitled ‘Of Gains and Loses’, states: “ George Gomez, Tamil Nadu Manual Workers’ Union, Tuticorin, who has several decades of experience in the shipping industry, says the Project cost will work out to Rs. 3000 crores. He says the Project will be a ‘sick unit’ as the money invested can never be recovered. ‘I don’t think any container ship will use the canal’. Major container operators deploying mother-vessels, will not use it. The difference in time between ships using the canal and those going around Sri Lanka will only be a few hours. Ships would not be able to cruise fast in the canal because they will have to be piloted, he argues. Moreover, the canal will have to be dredged continuously.”
31. In the Chennai based English daily, The Hindu, of 21 Dec 2004, Mr. K.S. Ramakrishnan, former Deputy Chairman of the Chennai Port Trust had questioned the need for the canal. He had stated: “- - - . But the canal cannot be a free seaway because the grounding of a wayward coal or oil ship that strays from the alignment or a collision of two ships in the channel will result in an ecological disaster of unimaginable proportions to the Gulf of Mannar and the Palk Bay”. He further stated: “ The two statements that the ships using the canal will save money and that the project will be a financially viable undertaking are therefore mutually contradictory and cannot have simultaneous validity”.
32. In the light of the foregoing analysis, it is debatable whether the investments made in the construction of the canal is justified from the security, environment or economic standpoints. The old adage ‘Haste Makes Waste’ readily comes to mind in the case of the SSSCP.
REFERENCES
(A) Business Line- 29 Dec 2004- ‘Will We Ever Learn’- P.Devarajan.
(B) “Is the Sethusamudram Shipping Canal Project Technically Feasible?”- R. Ramesh
(C) “Cyclones, Tsunami and the Sethusamudram Project”- Papri Sri Raman-
(www.boloji.com/environment/25.htm)
(D) Frontline- Vol 22- Issue 01, Jan 01-14, 2005- “Of Gains and Loses”- T.S.
Subramanian
(E) “Strategic Security and Sethusamudram Project”-Col. R.Hariharan (Retd)- http://www.saag.org-/ Paper No: 1713
(F) “ Countering LTTE’s Air Capability”- B.Raman- http://www.saag.org-/ Paper No: 2222
(G) “Maritime Related Terrorism”- Michael Richardson
(end of Part 1)
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Part 2 of 3
TIME AND SPACE CALCULATIONS-
NAVIGATING AROUND SRI LANKA AND NAVIGATING THROUGH SSSCP
PASSAGES FROM KOLKATA/CHENNAI TO TUITICORIN
BY
CAPT (RETD) H.Balakrishnan,I.N.
DISTANCES (in nautical miles- nm)- AROUND SRI LANKA
1. KOLKATA TO TUITICORIN = 1227 nm
2. CHENNAI TO TUITICORIN = 750 nm
(NB: Distances taken from Admiralty Distance Tables)
DISTANCES- KOLKATA-SSSCP-TUTICORIN
3. Kolkata to Palk Straits = 969 nm
4. SSSCP length (152.2 KMS) = 84 nm
5. SSSCP to Tuiticorin =45nm
6. Total Distance = (3) + (4) + (5)= 1098 nm
DISTANCES- CHENNAI-SSSCP-TUTICORIN
7. Chennai to Palk Straits = 180 nm
8. SSSCP length (152.2 KMS) = 84 nm
9. SSSCP to Tuiticorin = 45 nm
10. Total Distance = (7) + (8) + (9) = 309 nm
SAILING TIME- KOLKATA TO TUITICORIN AROUND SRI LANKA
11. @ 12 knots speed = 1227/12 = 102.25 hours
12. @ 15 knots speed = 1227/15 = 81.80 hours
SAILING TIME- KOLKATA TO TUITICORIN VIA SSSCP
13. Kolkata to Palk Straits
(A) @ 12 knots speed =969/12 = 80.75 hours
(B) @ 15 knots speed = 969/15 = 64.60 hours
14. SSSCP
(A) @ 6 knots speed = 84/6 = 14 hours
(B) @ 8 knots speed = 84/8 = 10.50 hours
15. SSSCP to Tuiticorin
( A) @ 12 knots speed = 45/12 = 3.75 hours
(B) @ 15 knots speed = 45/15 = 3.00 hours
16. Total time taken
(A) @ 12 knots and 6 knots = 80.75+14+3.75 = 98.5 hours
(B) @ 12 knots and 8 knots = 80.75+10.50+3.75 = 95.0 hours
(C) @ 15 knots and 6 knots = 64.60+14+3.00 = 81.60 hours
(D) @ 15 knots and 8 knots = 64.60+10.50+3.00 = 78.10 hours
SAILING TIME- CHENNAI TO TUITICORIN-
AROUND SRI LANKA AND VIA SSSCP
17. In a similar manner, the passage times from Chennai to Tuiticorin, around Sri Lanka and via the SSSCP at speeds and combinations thereof, indicated above, the times taken are indicated below.
18. Around Sri Lanka
(A) @ 12 knots speed = 750/12 = 62.50 hours
(B) @ 15 knots speed = 750/15 = 50.00 hours
19. Via the SSSCP
(A) @ 12 and 6 knots combination= 15.0+14.0+3.75 = 32.5hours
(B) @ 12 and 8 knots combination= 15.0+10.5+3.75=29.25 hours
(C) @ 15 and 6 knots combination = 12.0+14.0+3.00=29.0hours
(D) @ 15 and 8 knots combination = 12.0+10.5+3.00 = 25.50 hours
(N.B. The foregoing distances at paras 3 to 19 above have been derived from actual plotting on navigational charts.)
20. Additional Time For Passage Planning For purposes of embarkation/disembarkation of 'Pilot', manoeuvering of engines in the SSSCP, as also for any delays in embarkation of 'Pilot'- ADD = 2 hours (at the minimum) to all the passage times indicated above.
DEDUCTIONS
21. From the foregoing calculations, the following deductions can be arrived at:
(A) The difference in time taken to reach Tuiticorin from Kolkata, circumnavigating Sri Lanka and navigating through the SSSCP at speeds of 12 and 6 knots is = 1.75 hours
(B) The difference in time taken to reach Tuiticorin from Kolkata, circumnavigating Sri Lanka and navigating through the SSSCP at speeds of 12 and 8 knots is = 5.25 hours
(C) The difference in time taken to reach Tuiticorin from Kolkata, circumnavigating Sri Lanka and navigating through the SSSCP at speeds of 15 and 6 knots is = 18.6 hours
(D) The difference in time taken to reach Tuiticorin from Kolkata, circumnavigating Sri Lanka and navigating through the SSSCP at speeds of 15 and 8 knots is = 22.15 hours
(E) The difference in time taken to reach Tuiticorin from Chennai circumnavigating Sri Lanka and navigating through the SSSCP at speeds of 12 and 6 knots is = 27.75 hours
(F) The difference in time taken to reach Tuiticorin from Chennai circumnavigating Sri Lanka and navigating through the SSSCP at speeds of 15 and 8 knots is = 22.50 hours
(G) Comment: The Indian Flag coal carrying bulk-carriers plying the coastal route to Chennai/ Tuiticorin transit at speeds of 12 to 13 knots . Therefore, time differences between circumnavigating Sri Lanka and transiting through the Sethusamdram Ship Canal are NOT going to be very marked.
(H) While there is savings in distance navigating through the SSCP, this does not automatically translate into commensurate savings in time, on account of the 'slow speeds' required to navigate through the SSSCP. This is on account of a phenomenon termed 'SHALLOW WATER EFFECT',or,'SQUAT EFFECT,where the ship's propellers tend to seek the sea bottom while proceeding at High Speeds in shallow waters. The SSSCP is to have a dredged depth of 12 meters and can be used by ships having a draught of upto 10.7 meters. Thus the difference between the ship's keel and the sea bottom will be 12.0-10.7=1.3 metres. This explains the necessity for 'slow speeds' through the SSCP.
(I) It is mandatory for ships using the SSSCP to embark a 'pilot'. In the calculations above, at a conservative estimate, a time 2 hours has been added to passage time calculations. Under actual conditions, this time may be more than the 2 hours. All the major ports of India suffer from a shortage of 'pilots'. Therefore, the SSSCP is also likely to suffer from this prevailing malaise. It is therefore appreciated that vessels arriving at the 'pilot boarding grounds' at the SSSCP may have to anchor and await
'pilot boarding'. In this light, it would further tend reduce the difference in time between circumnavigating Sri Lanka and using the SSSCP.
(J) The 'pilotage rates' that are going to be charged for availing of the Sethusamudram Canal are not known at present. However, this is the only recourse available to recover the 'capital costs' involved in the making of the 'Sethusamudrm Canal'. It is therefore appreciated that the 'pilotage rates' for navigating through the Sethsamudram Canal might not prove to be competitive for the shipping industry.
(K) Navigating through the Sethusamudram Canal, does reduce the distances between Kolkata/Cennai and Tuiticorin. This will reduce fuel costs. However, this advantage will be offset by anticipated 'high pilotage rates' and 'time delays' in embarking 'pilot'.
CONCLUSION
22. The foregoing calculations, from first principles, clearly highlight the unviability of the SSCP, from the shipping standpoint.
(end of Part 2)
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Part 3 of 3
SETHU SAMUDRAM SHIP CANAL PROJECT- COST BENEFIT ANALYSIS
By
Capt (Retd) H.Balakrishnan, I.N.
INTRODUCTION
1. The official project paper of the SSSCP states that the estimated investment of Rs. 2400 crores will " earn an operating profit from its very FIRST YEAR of operation and that the capital will be recovered with 9% interest WITHIN THE FIRST 25 YEARS after which THERE WILL BE A MAMOTH PROFIT GENERATION in the next 25 years". (REF: THE HINDU- OPEN PAGE- 21 DEC 2004- "SETHUSAMUDRAM- WILL THE SHIPS USE IT"- MR. K.S. Ramakrishnan, Former Dy. Chairman, Chennai Port Trust and Former M.D. Poompuhar Shipping Corporation, Chennai).
2. The Capital cost of constructing the SSSC is Rs. 2330 crores. The equity component of the Special Purpose Vehicle (SPV) is Rs. 971 crores. The debt portion has been pegged at Rs. 1456.40 crores. (REF: BUSINESSLINE- 19 MAY 2005- "CCEA CLEARS SETHUSAMUDRAM PROJECT AT RS. 2427 CRORES")
3. For the debt portion of Rs. 1456.40 crores, assuming an interest burden of 10%, it works out to Rs. 145.64 crores per annum. Assuming a repayment period of 25 years, the annual installments for repaying the capital, work out to Rs. 58.25 crores.
4. Thus, the total annual financial repayment for servicing the debt would be Rs.145.64 + Rs. 58.25 crores = Rs. 203.89 crores OR Rs. 204 crores (approx).
5. The major contributor to the earnings of the SSCP will be the ships that navigate through the canal.
6. This paper analyses the cost benefit that accrues to the ships that navigate through the Sethusamudram Canal.
ESTIMATE OF SHIPS THAT WILL ANVIGATE THROUGH THE
SETHU SAMUDRAM CANAL (SSC)
7. According to the consultants for the SSSCP, the number of ships that are expected to navigate through the SSC is 3055 in 2008 and 7141 in 2025.
8. Coal Ships One can predict with a reasonable accuracy the number of coal carrying bulk-carriers that will navigate through the SSC. These vessels carry thermal coal from Haldia/Paradeep/Vizag to Chennai/Tuiticorin to cater to the requirements of the Thermal Power Plants located at these ports.
9. Annual Requirement of Coal Ships for Tuitcorin
(a) Installed capacity of the Tuiticorin Thermal Power plant = 1050 MW
(b) Annual requirement of coal = 1050 X 6144.8 Tonnes = 6452040 Tonnes
( NOTE: The figure 6144.8 Tonnes is the annual requirement of coal to generate 1 MW of power. TNEB website refers)
(c ) Deadweight Tonnage of a bulk-carrier = 30,000 DWT
(d) Thus, number of vessels required annually = 6452040/30,000 = 215 ships.
10. Other Vessels. To cater to the requirement of petroleum products for Tuiticorin and nearby areas, at a very optimistic rate = 200 vessels.
11. At the most, it may be possible that 1000 vessels use the SSC annually, though this figure may not be realized, and is nowhere near the projected 3055 vessels in 2008. This is on account of the fact that global shipping trends are towards larger vessels of 60,000 DWT and above, and the SSC being restricted to vessels of 30,000 DWT- 34,000 DWT, with a draught limitation of 10.7 Metres.
COST RECOVERY
12. (a) The annual financial repayment burden on the SSCP videPara 4 above = Rs 204 crores
(b) Maximum number of ships expected to use the SSC = 1000 ships
(c ) Thus, cost per ship to be levied through pilotage/allied rates = Rs. 204/1000= Rs. 0.2 crores OR RUPEES TWENTY LAKHS AND FORTY THOUSAND (at a very conservative estimate )
FUEL COSTS FOR VOYAGES KOLKATA/CHENNAI TO TUITICORIN AROUND SRI LANKA/ SSCP
13. Vessels use Heavy Fuel Oil (HFO). The cost of 1 Metric Tonne (MT) of HFO as per I.O.C . pricing as on 01 MAY 2007, with 12.5% VAT works out to = Rs 24,020
14. Kolkata to Tuticorin
(a) Distance Kolkata-Tuticorin around Sri Lanka = 1227 nm
(b) Distance Kolkata-Tuiticorin via SSCP= 1098 nm
(c )Time taken at 12 knots for (a) above= 102.25 h
(d) Time taken at 15 knots for (a) above = 81.80 h
(e) Time taken at 12 and 6 knots for (b) above= 98.5 h
(f) Time taken at 12 and 8 knots for (b) above = 95.0 h
(g) Time taken at 15 and 6 knots for (b) above = 81.6 h
(h) Time taken at 15 and 8 knots for (b) above= 78.1 h
15. Fuel consumption rate for these vessels is = 1 MT/h
16. Thus, total voyage fuel consumption will be as follows:
(a) For Para 14 (c) = 102.25 MT
(b) For Para 14 (d) = 81.80 MT
(C ) For Para 14 (e) = 98.5 MT
(d) For Para 14 (f) = 95.0 MT
(e) For Para 14 (g) = 81.6 MT
(f) For Para 14 (h) = 78.1 MT
17. Total voyage fuel costs
(a) Para 16 (a) above = Rs. 24,020 X 102.5 = Rs. 24,56,045.00
(b) Para 16 (b) above = Rs. 24,020 X 81.80 = Rs. 19,64,836.00
(c) Para 16 (c ) above =Rs. 24,020 X 98.50 = Rs. 23,65,970.00
(d) Para 16 (d) above = Rs. 24,020 X 95.00 = Rs. 22,81,900.00
(e) Para 16 (e) above = Rs. 24,020 X 81.60 = Rs. 19,60,032.00
(f) Para 16 (f) above = Rs. 24,020 X 78.10 = Rs. 18,75,962.00
18. Total voyage costs including pilotage and allied costs. In addition to the foregoing, pilotage and other allied charges as at Para 12 (c) above have to be added to the values at Paras 17 (c) to 17 (f). Thus the total costs will work out as follows:
(a) Rs. 23,65,970.00 + Rs. 20,40,000.00 = Rs. 44,05,970.00
(b) Rs. 22,81,900.00 + Rs. 20,40,000.00 = Rs. 43,21,900.00
(c) Rs. 19,60,032.00 + Rs. 20,40,000.00 = Rs. 40,00,032.00
(d) Rs. 18,75,962.00 + Rs. 20,40,000.00 = Rs. 39,15,962.00
19. Chennai to Tuiticorin
(a) Distance Chennai to Tuticorin around Sri Lanka=750 nm
(b) Distance Chennai to Tuticorin via SSCP =310 nm
(c) Time taken at 12 knots for (a) above =62.5h
(d) Time taken at 15 knots for (a) above =50.0h
(e) Time taken at 12 and 6 knots for (b) above =32.75h
(f) Time taken at 12 and 8 knots for (b) above =29.25h
(g) Time taken at 15 and 6 knots for (b) above =29.0h
(h) Time taken at 15 and 8 knots for (b) above =25.5h
20. Thus, total fuel consumption for the voyage will be as follows:
(a) For 19 (c ) above =62.5 MT
(b) For 19 (d) above =50.0 MT
(c )For 19 (e) above =32.75 MT
(d) For 19 (f) above =29.25 MT
(e) For 19 (g) above =29.0 MT
(f) For 19 (h) above =25.5 MT
21 Total Voyage Fuel Costs.
(a) For Para 20 (a) above = Rs.24,020 X 62.5 = Rs.15,01,250
(b) For Para 20 (b) above = Rs.24,020 X 50.0 = Rs. 12,01,000
(c) For Para 20 (c )above = Rs. 24,020 X 32.75=Rs. 7,86,655
(d) For Para 20 (d) above = Rs. 24,020 X 29.25=Rs. 7,02,585
(e) For Para 20 (e) above = Rs.24,020 X 29.00 =Rs. 6,96,580
(f) For Para 20 (f) above = Rs. 24,020 X 25.50 =RS. 6,12,510
22. Total Voyage Costs Including Plotage and Allied Costs. The total voyage costs work out as follows:
(a) Rs. 7,86,655.00 + Rs. 20,40,000.00 = Rs. 28,26,655.00
(b) Rs. 7,02,585.00 + Rs. 20,40,000.00 = Rs. 27,42,585.00
(c) Rs. 6,96,580.00 + Rs. 20,40,000.00 = Rs. 27,36,580.00
(d) Rs. 6,12,510.00 + Rs. 20,40,000.00 = Rs. 26,52,510.00
(Note: Many ocean going vessels use a combination of HFO for the ocean passage, and Motor Diesel Oil (MDO) for manoeuvering engines in restricted waters, like the SSCP. The I.O.C. rate for MDO/MT as on 01 MAY 2007, with 25% VAT, works out to Rs. 40,53,745.00.Considering the fact that vessels will have to manoeuvre their engines while transiting through the SSC, it is safe to assume a specific fuel consumption of 1 MT/h also. This would further increase the 'total voyage costs'. For the purposes of this paper, only HFO is being taken as the basis for the calculations.)
DEDUCTIONS
23. Kolkata to Tuticorin around Sri Lanka/ via SSC. It is 'MORE COST EFFECTIVE' to CIRCUMNAVIGATE Sri Lanka than routing through the SSC by amounts ranging from Rs. 19,49,925.00 (Rupees NINETEEN LAKHS, FORTY NINE THOUSAND, NINE HUNDRED AND TWENT FIVE ONLY), [Para 18 (a)–Para 17 (a)], TO, Rs. 19,51,126.00 (Rupees NINETEEN LAKHS, FIFTY ONE THOUSAND, ONE HUNDRED AND TWENTY SIX ONLY ), [ Para 18 (d)–Para 17 (b) ]
24. Chennai to Tuticorin around Sri Lanka / via SSSCP. It is 'MORE COST EFFECTIVE' to CIRCUMNAVIGATE Sri Lanka than routing through the SSSC by amounts ranging from Rs. 13,25,405.00 (Rupees THIRTEEN LAKHS, TWENTY FIVE THOUSAND, FOUR HUNDRED AND FIVE ONLY), [Para 22 (a) – Para 21 (a) ], TO, Rs. 14,51,260.00 (Rupees FOURTEEN LAKHS, FIFTYONE THOUSAND, TWO HUNDRED AND SIXTY ONLY), [ Para 22 (d) – Para 21 (b) ].
CONCLUSION
25. In the reference quoted at Para 1 above, Mr. K.S. Ramakrishnan, had made TWO insightful comments. Firstly, "the saving in sailing time for that ship will also be substantially less than the 36 hours projected by the SSCP because the ship cannot be towed at its normal speed through the canal, and time will also be lost in embarkation/disembarkation of pilots and other inspection procedures. The saving in sailing time of just about a day will not justify the incurring of over 8 times the cost of the saved fuel". Secondly, " the two statements that the ships using the Sethu Samudram Ship Canal will save money and that the SSSCP will be a financially viable undertaking are therefore mutually contradictory and cannot have simultaneous validity ". His wise words of reason have been corroborated by the 'Time and Space' and 'Voyage Costs' calculations.
26. It is quite possible that Indian Flag flying ships maybe 'coerced' into using the SSC to justify its existence. However, no such compulsions exist in respect of foreign flag ships.
27. The Sethu Samudram Canal Project Just Does Not Make 'Nautical Sense'.
ACKNOWLEDGEMENT
28 . My profound gratitude is due to Dr. S.Kalyanaraman, Phd., former Executive Director, Asian Development Bank, Manila, Shri V.Sundaram, I.A.S. (retd) and, First Chairman, Tuiticorin Port Trust, and Shri Govindan Menon. But for their valuable and insightful inputs, this analysis would not have been possible.
(CONCLUDED)
RE: Ram Setu - Indian Navy position
From: Venugopal Kaikulath (venu1005@hotmail.com)
Sent: Monday, September 24, 2007 8:12:34 PM
To: kalyan97 (kalyan97@gmail.com)
Dear Kalyanaramanji,
Thank you very much for your prompt response and it is extremely kind of you to forward my e-mail to someone in the know on this subject. I eagerly await to hear from Capt. Balakrishnan. As a last resort those wanting to destroy Ram Setu may seek to obtain a statement from the Navy that the project would be in the interest of the Indian Navy. We must pre-empt the possibility of such a statement by having the Army declare that in principle they exist to defend the country and its heritage and not destroy it.
Regards
K.Venugopal
Date: Mon, 24 Sep 2007 15:46:54 +0530
Subject: Fwd: Ram Setu - Indian Navy position
I have no idea on the subject. I think Indian Navy has been doing well guarding the coastline without the channel. In fact, the channel may be a risky affair for the coast guard to use, becoming a sitting duck in a strait from enemy forces. Anyway, I am referring this to Capt. Balakrishnan who may be able to respond to you. Namaskaram. kalyanaraman
From: Venugopal Kaikulath <venu1005@hotmail.com>
Date: Sep 24, 2007 8:17 AM
Subject: Ram Setu - Indian Navy position
To: kalyan97@gmail.com
Dear Sir, I am writing to you directly because I have been reading your postings in Haindava Keralam and know that you are well-versed with the Ram Setu issue. I am worried about one thing. Has the Indian Navy so far expressed their opinion on the issue? How are they presently going from, say, Cochin to Chennai? Are they also going round Sri Lanka? If so, would a canal be beneficial for them? Or would it be that a canal would be detrimental to the Navy from the point of view of security? Please research into this and write on this issue. Please also personally e-mail me a copy of your opinion on the subject. Regards
Date: Sep 24, 2007 8:17 AM
Subject: Ram Setu - Indian Navy position
To: kalyan97@gmail.com
Dear Sir, I am writing to you directly because I have been reading your postings in Haindava Keralam and know that you are well-versed with the Ram Setu issue. I am worried about one thing. Has the Indian Navy so far expressed their opinion on the issue? How are they presently going from, say, Cochin to Chennai? Are they also going round Sri Lanka? If so, would a canal be beneficial for them? Or would it be that a canal would be detrimental to the Navy from the point of view of security? Please research into this and write on this issue. Please also personally e-mail me a copy of your opinion on the subject. Regards
K.VenugopalMumbai
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