APM Terminals CEO Kim Fejfer is bullish about development opportunities in India pointing out that the nation, being the world's third largest economy with a population of 1.2 billion, still remains underrepresented as a player in global trade.
"The opportunities for development throughout India, one of the world's largest and fastest-growing economies, are exciting and energizing and APM Terminals is committed to being a part of that growth," said Mr Fejfer. He was speaking to local business leaders and customers as part of a keynote address at the India Ports Conference in Mumbai.
Although the Indian economy expanded by an estimated 7.8 per cent in 2011 to US$1.8 trillion, India ranked 13th in imports and 21st in exports globally last year. South Asia, which includes Pakistan and Bangladesh, represented only three per cent of global container throughout in 2011, according to estimates by Alphaliner, with combined container volume of 18 million TEU, four million less than the Port of Shenzhen in China.
Throughput at India's ports accounted for 9.7 million TEU in 2011, or one twelfth of what global container traffic averages based on economic output would suggest as necessary to meet the economy's needs. In his presentation, the CEO estimated the infrastructure investment necessary to enable projected growth at US$20 billion.
Jawaharlal Nehru Port (JNP), serving Mumbai, is India's busiest container port, accounting for nearly 45 per cent of all Indian containerised cargo traffic. It is the 25th busiest box port in the world, with throughput of 4.3 million TEU in 2011, including 1.9 million TEU handled by APM Terminals Mumbai for the whole of last year.
Congestion and capacity issues at Indian ports have begun to affect trade growth, as existing container terminals are at 84 per cent capacity and above, and access to inland points remains inadequate, the experts maintain.
The Indian government is determined to promote infrastructure growth and has projected container throughput to increase to 11 million TEU by 2016 and 23 million TEU by 2020, as called for in the latest 10-Year Plan released by the Indian Ministry of Shipping. Mr Fejfer pointed out that private sector involvement will be a crucial component of this growth if the investment and regulatory environment in India do not act as constraints.
"Port tariff regulations which penalise increased throughput and productivity will not assist in developing the needed infrastructure," added Mr Fejfer.
In addition to Mumbai, the company also operates a terminal in Pipavav also on the Indian west coast in the State of Gujarat. Pipavav has been recognised as the nation's fastest-growing port with a throughput of an estimated 620,000 TEU in 2011, and is India's first private sector port operation.
Other business interests in India encompass APM Terminals India Pvt Ltd, which offers inland services at seven locations throughout the country, including at Chennai. The company also operates global service centres in Mumbai, Chennai and Pune.
"We are pleased with the progress that we have made since entering this market in 2006, and we will continue to look for the right opportunities to expand our presence here to serve our customers and India's great economic potential," added Mr Fejfer.