India speeds development efforts to turn nation into a freight hub

INDIA's Ministry of Shipping plans to create a 'national port grid' to pinpoint opportunities for operational synergies between major public ports and minor port entities under the control of state agencies

28 October 2019 - 19:00

INDIA's Ministry of Shipping plans to create a 'national port grid' to pinpoint opportunities for operational synergies between major public ports and minor port entities under the control of state agencies.

At a recent meeting held with the heads of state maritime bodies, officials said out of 204 minor ports located across India's 4,600 miles of coastline, only 44 are currently capable of handling freight, with the remainder either serving as fishing harbours or are defunct.

'All these ports have been centres of maritime activity in the past, and if revived, they can once again become important centres of sea trade,' the Ministry of Shipping said in a statement, reported IHS Media.

The ministry emphasised the need to redevelop under-utilised minor ports entities into freight handlers and to that end, it said a joint committee representing the ministry, state maritime boards, and the Indian Ports Association (IPA) will be set up.

'The committee will analyse the prospect and strategy of developing the non-operational non-major ports into operational ports and submit its recommendations for implementation in a time-bound manner,' the statement said.

'An extensive study will be done for revival of each port, identifying the specific cargo linked to it and the downstream industry. The Centre [government] will share the study findings with the states so that the non-functional minor ports can be developed and made functional.'

The ministry also called for greater cooperation among federal and state port stakeholders to create a vibrant maritime environment at a time when coastal shipping and inland waterways are seen as the way forward from a cost and environmental point of view. Given that context, stakeholders debated the possibility of formulating common, comprehensive policy guidelines for barge transportation within the country.

Addressing the session, Shipping Minister Mansukh Mandaviya said the ministry has embarked on a multi-pronged programme to raise port capacity and efficiency where digitisation remains a key element.

Another issue that came up for discussion was how the port community system - a nationwide digital platform for port users - is settling into the maritime ecosystem. Stakeholders said thanks to trade outreach efforts, the pace of industry adoption has accelerated in recent months with 15,000 users joining the network since the PCS1x launch in December 2018.

From a market share perspective, minor ports hold considerable significance to Indian freight transportation. Two factors have essentially contributed to their steady growth: unregulated tariffs along with fewer government controls and relatively modern infrastructure.

Much of the minor ports' growth has thus far come from Adani Group-owned cargo terminals at Mundra, Hazira, Dahej, Kandla, Dhamra, Mormugao, Visakhapatnam and Kattupalli, which combined account for one-quarter of the country's total port capacity. Other notable players in the non-government category are APM Terminals Pipavav and Krishnapatnam port.

With the emergence of more non-government port entities as the government stepped up maritime infrastructure development efforts through private participation, the growth gap between major ports and minor counterparts has begun to widen. In fiscal year 2018-19, cargo tonnage at minor ports rose 10.1 per cent year on year, compared with the 2.9 per cent increase reported at major ports, according to a analysis of port data.


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