Indonesia lacks ships to transport coal

Indonesia still needs to operate foreign flagged ships to transport coal in the country because the number of local ships is still far from enough to meet the demand, Media Indonesia reported Thursday.

Soehariyo, the head of the dry bulk division at the Indonesian National Ship owners Association (INSA), said in Jakarta Wednesday that Indonesia had only six ships at present far lower than the requirement which reached at least 20 ships.

"This is why many coal producers still use foreign ships to transport their coal," he said when asked to comment on the transportation ministry's recent decision to allow the operation of an Italian-flagged ship MV Salvatore.

The Italian ship has been operated by PT Adyana to transport 300,000 tons of coal from Samarinda to the Tanjung Jati B coal-fired power plant in Central Java. The license for the operation of the ships is valid from Aug 25 to Nov. 25 this year.

However, unlike Soehariyo, the chairman of the association, Oentoro Surya said that the operation of the Italian ship violated the Cabotage principle in which the transportation of goods within the country should be handled by local ships.

Ministry of transportation has given expemption for foreign ships to transport coal within Indonesia until 2010. Under the cabotage rule that currently being applied, only Indonesian-flagged ships are allowed transport goods domestically.(*)