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Ports

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OVERVIEW

SIZE
 

  • Indian ports handled cargo of 510 million tonnes in 2004-05, 10.8% increase over 2003-04
     

  • 80% of the port traffic by volume is dry and liquid bulk, remaining 20% is general cargo, including containers

    • Containerised cargo has grown at a rate of 15% p.a. over the last 5 years
       

  • India has 12 Major Ports and 185 Minor Ports along 7,517 km long Indian coastline

    • Cargo handled by Major Ports has increased by 9.5% p.a. over last 3 years

    • Major ports handle 75% of the total traffic
       

      


The JNPT port where the
capacity will be over
3 million TEU by 2006


The port sector has seen
significant investment by
major global port operators

  • Of the 12 Major Ports, 11 ports are run by Port Trusts while the port at Ennore is a corporation under the Central Government. These ports handled 383 million tonnes of cargo in 2004-05
     

  • Two major Government projects underway:

    • Project “Sethusamundram”: Dredging of the Palk Strait, in Southern India to facilitate maritime trade through it

    • Project “Sagarmala”: $22 billion project for the modernisation of Major and Minor Ports
       

STRUCTURE

  • Government of India dominated maritime activity in the past. Policy direction is now oriented to encouraging the private sector to take the lead in port development and operations

      

  • Many Major ports now operate largely as landlord ports - International port operators have been invited to submit competitive bid for BOT terminals on a revenue share basis
     

  • Significant investment on BOT basis by foreign players including Maersk (JNPT, Mumbai) and P & O Ports (JNPT, Mumbai and Chennai), Dubai Ports International (Cochin and Vishakhapatnam) and PSA Singapore (Tuticorin)
     

  • Minor ports are being developed by domestic and international private investors: Pipavav Port by Maersk, Mundra Port by Adani Group (with a terminal operated by P & O)

POLICY

  • 100% FDI under the automatic route is permitted for port development projects
     

  • 100% income tax exemption for a period of 10 years
     

  • Tariff Authority of Major Ports (TAMP) regulates the ceiling for tariffs charged by Major ports/port operators (not applicable to Minor ports)
     

  • A comprehensive National Maritime Development Policy is being formulated to facilitate private investment, improve service quality and promote competitiveness.

Cargo handled by Major Ports in India
 

Major Port

Trade
(04-05, MMT)

Container Traffic
(04-05)(million TEU*)
Chennai Port
44
0.62
Cochin Port 14 0.19
Ennore 9.5 —
Haldia 36 0.13
JNPT 33 2.37
Kandla Port 42 0.18
Kolkata Port 10 0.16
Mormagao 31 0.01
Mumbai Port 35 0.22
New Mangalore Port 34 —
Paradip Port 30 —
Tuticorin Port 16 0.30
Vizag Port 50 0.05

Source: Indian Ports Association

* Twenty foot equivalent unit

 


OPPORTUNITY

OUTLOOK

  • Cargo handling at all the ports is projected to grow at 7.7% p.a. till 2013-14 with Minor ports growing at a faster rate of 8.5% compared to 7.4% for the Major ports

    • Traffic estimated to reach 960 million tonnes by 2013-14

    • Containerised cargo is expected to grow at 17.3% over the next 9 years
       

  • The New Foreign Trade Policy envisages doubling of India’s share in global exports in next five years to $150 billion

    • A large portion of the foreign trade to be through the maritime route: 95% by volume and 70% by value

POTENTIAL

  • Growth in merchandise exports projected at over 13% p.a. underlines the need for large investments in port infrastructure
     

  • Investment need of $13.5 billion in the major ports under National Maritime Development Program (NMDP) to boost infrastructure at these ports in the next nine years

    • Under NMDP, 219 projects have been identified for the development of Major ports

    • Public–Private partnership is seen by the Government as the key to improve Major and Minor ports

      • * 64% of the proposed investment in Major ports envisaged from private players
         

  • The plan proposes an additional port handling capacity of 530 MMTA in Major Ports through:

    • Projects related to port development
      (construction of jetties, berths etc.)

    • Procurement, replacement or up-gradation of port equipment

    • Deepening of channels to improve draft

    • Projects related to port connectivity
       

  • Investment need of $4.5 billion for improving Minor Ports

For additional information: Department of Shipping, Ministry of Shipping, Road Transport & Highways (http://shipping.nic.in)
 

Content Source: www.investmentcommission.in

 
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