15SEP2017 - NEWS - Bunker sales fall 90% post-GST implementation in India

Bunker sales in India touched 2 million tonnes in the year to March 2017 with average monthly sales hitting as much as 150,000 tonnes.

90% drop
“Bunker sales have dropped by as much as 90% with the introduction of GST,” said an industry official. “Sales are happening only on account of emergency situations where ships are stuck due to wrong calculations on bunker requirements,” he added.

Sales in Mumbai dropped from 8,000-10,000 tonnes a month to about 500-1,000 tonnes post-GST, said industry officials.

In Kochi, monthly bunker sales have tanked to 3,000-4,000 tonnes from about 25,000-30,000 tonnes.

Prior to GST, the value added tax (VAT) on bonded bunkers sold to ships engaged in a foreign voyage was in the range of 0-4 per cent, varying from one state to another.

The steep fall in bunker sales is having a cascading effect on foreign exchange earnings, logistics, barge operations and ancillary services

Foreign vessels tank up in Colombo to avoid higher rates at Indian ports Ships are avoiding re-fuelling in India since July after an 18% Goods and Services Tax (GST) raised bunker (ship fuel) costs substantially, forcing vessel owners to tank up in Colombo.

As reported in Local Media.