Key Issues for Port Sector Development in India. George Tharakan Mumbai, June 16-17, 17, 2005

Transcription

1 Key Issues for Port Sector Development in India George Tharakan Mumbai, June 16-17, 17, 2005

2 India s s Port Sector There are 12 major ports and 185 minor ports on a coastline of over 6000 km The 12 major ports handle about 75% of port traffic Traffic at the 12 major ports totaled almost 350 million tons in 2003/04. By way of comparison, China s Shanghai Port alone handles well over 100 million tons Containerized cargo in 2003/04 was a little over 50 million tons Hong Kong handled over 200 million tons of container traffic Overall growth in India s port traffic was 9.9 % in 2003/04, and for the first nine months in 2004/05 it was 10.9% All indications are that the port sector is going to experience explosive growth.

3 National Maritime Development Program Investments on the order of Rs 58,000 crore (about $15 billion) over a ten-year period Private sector expected to invest Rs 35,000 crore or about 60% of the total Most of the rest would be from Port Authorities internal cash generation Rs 5600 cr, and budget support Rs 10,600 cr In addition, the road and rail sectors are expected to contribute Rs 2600 cr for port hinterland connectivity improvements All major ports are included in NMDP, but largest investments are for Mumbai JNPT, Cochin, New Mangalore and Kolkata NMDP also includes the Sethu Samudram project to dredge a navigable channel between India and Sri Lanka

4 Maritime Sector Policy Related to Port Development Some features of the recently formulated policy: Improve hinterland connectivity to ensure efficient port access and promote inter-port competition for cargo Facilitate private investment in ports, and ensure a competitive environment that precludes the emergence of monopolies Safeguard investments while ensuring compliance with agreed service standards Rationalize Multi-Modal Transportation of Goods Act, 1993 to support through movement of cargo. Port labor involved in concessioned facilities to become the responsibility of the concessionaire

5 Port Developments 1995 to 2005 World Bank report in 1995 identified a number of areas for improvement: Container handling productivity was only 2000 tons/ship-berth-day, this is now 7405 tons General cargo productivity was 823 tons/ship-berthday, this is now 1691 tons Port organization has shifted to the landlord port model, greater autonomy of management, and the very substantial involvement of private operators Tariff Authority for major Ports (TAMP) as independent regulator facilitates private investment

6 Jawaharlal Nehru Port Trust P&O Australia Experience In July 1997, Jawaharlal Nehru Port Trust signed a 30 year BOT concession with P&O Australia, for development of the Nhava Sheva International Container Terminal (NSICT). M/s P&O completed the project ahead of schedule and commenced operations in April The total investment on this project was about Rs. 900 core. NSICT was expected to handle million TEUs in the first year of operations, reaching 0.5 million TEUs in the sixth year of operations. In fact, million TEUs were handled during the first year. Traffic handled by NSICT during the last financial year ( ) was 1.23 million TEUs.

7 Traffic Trends at Major Ports April - December Change over previous year * 2003# 2004# # (Million Tonnes) (Per Cent) POL Iron Ore Fertilizer/ raw matls Food Grain Coal Vegetable oil Other liquids Container Cargo Others TOTAL Source : Department of Shipping * Provisional # April - December

8 Container Traffic Rationalization of container movements will help alleviate some of problems currently experienced: Presently, though all major ports have container capacity, 60 % of traffic moves through JNPT JNPT and its hinterland connections, particularly the Delhi-Mumbai corridor, are capacity constrained Recently, the liner conference imposed a $55/TEU congestion surcharge on Mumbai boxes Rationalizing container flows to ports such as Cochin, and ports in Gujarat could reduce pressure on JNPT

9 Coal Traffic Coal imports and coastal traffic is likely to increasingly become a factor in the port sector: Presently, 95% of coal movement is on the railways Shifting some of this to inland waterways and coastal shipping will release badly needed rail capacity Developing port capacity for coal movements will also help when coal imports increase as projected National Waterway 1 could be developed to serve the coal producing areas

10 Food Grain Movements Indian ports now have very little food grain handling capacity as the country has become self-sufficient: However, it is projected that by 2010 the country will produce a surplus of the order of 75 million tonnes Most of the food grain surplus states such as UP, Bihar, Haryana, Punjab are located along the Ganga which could be developed to serve this export traffic National Waterway 1 (Ganges system) could perform the same function as the US Mississippi System

11 Other Traffic Likely to Face Capacity Constraints In a number of other areas potential capacity constraints have been identified: Automobile exports in 2004 registered growth of over 50%. Presently, exports exceed 500,000 vehicles and this could require specialized port facilities. Fertilizer handling capacity is now < 5 million tons, Traffic is forecast to exceed 13 million tons by 2010 Iron ore handling capacity is around 50 million tons, while traffic is projected to be 65 million tons by 2010

12 Capacity Shortfalls at Major Ports for Selected Commodities Present Traffic* Forecast Traffic+ Present Capacity# Forecast Shortfall (Million Tonnes) Iron Ore Fertilizer/ raw matls Food Grain Coal Container Cargo Source : *Department of Shipping # India Ports Association + Port Transportation Connectivity, India LEA Intl. et. al

13 Hinterland Connectivity Most of the major ports suffer from inadequate hinterland connectivity: Rail connectivity is a problem at Nhava Sheva and Cochin and in other ports also due to shortages of rolling stock and track limitations. Highway connectivity to the national highway network is often problematic being addressed in NHDP Waterways have the potential to relieve other modes and can also be developed with minimum land acquisition and displacement of peoples

14 Thank You