Ports sector

An Expert's View about Sea, Coastal and Inland Water Transport in India

Last updated: 29 Jul 2011

The port privatisation policy announced by the Government of India in October 1996 offers a number of opportunities for British companies engaged in port consultancy, construction, management and turnkey contracts.

Sector briefing Ports sector in India Why India? India has a coast line of over 7000 km with a maritime tradition dating back several centuries. It has thirteen major ports under the jurisdiction of the central government and one hundred and eighty seven non-major ports which are controlled by the respective state governments. The port privatisation policy announced by the Government of India in October 1996 offers a number of opportunities for British companies engaged in port consultancy, construction, management and turnkey contracts. The general layout of the facilities in the older ports is outdated and the facilities are not suitable for modern cargo handling. There is ample scope to increase the capacity of existing facilities through modernisation and improvements in productivity and construction of new berths. The value of such projects would range from £2million to £700 million. See the UKTI website for general information about India. The ?Doing business? guide includes an overview of the economy, business culture, potential opportunities and other relevant issues. UK Trade & Investment Sector briefing: Ports sector in India Opportunities ? For bringing uniformity and transparency in the PPP process, With a robust growth of the Indian economy at Ministry of shipping have put in place nearly 9% annually, traffic handled by Indian standardised RFQ, RFP and model ports has witnessed a quantum jump. As per a concession agreements. research paper by CRISIL (Credit Rating and Information Services India Limited), traffic in At present, there are 22 PPP projects in Indian ports is expected to grow at a CAGR of operation at the major ports at a total cost 9% from 761 MT in 2008-09 to 1166 MT in of £0.8 billion. Another 21 projects are 2013-14. During the year 2010-11, the total under implementation with an investment volume of cargo handled by both major and of around £1.76 billion to add 172 MT of non major ports stood at 869.9 MT. Of this, capacity across the major ports. In the year 569.9 MT was the volume of cargo handled by 2009-10 alone, 13 projects were awarded major ports and the balance by non major in the major ports for a value of £370 ports. million for construction of berths and terminals and mechanisation. The National Maritime development programme (NMDP) Traffic handled by major ports in India- undertook a number of schemes for 2010-11 capacity expansion in major ports. As a result, capacity of major ports which was Port 2011 (MT) 397.50 MT in 2004-05 increased to 617 MT Mumbai 54.58 March 2010. JNPT 64.30 Visakhapatnam 68.04 There are many UK companies operating Ennore 11.00 successfully in this market in areas of port Paradip 56.03 consultancy, port management, material Kolkata Dock handling and port construction. Some of the 47.43 (incl. Haldia) major international companies operating in Kandla 81.88 the Indian ports sector include PSA Chennai 61.46 (formerly Port of Singapore Authority), Kochi 17.87 Dragdos SPL of Spain, Port of Zebrugee Mormugao 50.02 Belgium, Scot Wilson Kirkpatrik India Tuticorin 25.72 Pvt.Ltd, H.R. Wallingford,UK and Dredging New Mangalore 31.55 International (Belgium). In addition, major Total 569.90 infrastructure companies from India such as Larsen & Toubro (L&T), GVK, Gammon, Currently, the combined port capacity (major Hindustan Construction Corporation, IL&FS, and non major ports) in India stands at 1000 Reliance, Adani and Marg are operating in MT and Indian ports need to undertake major the port sector. modernisation and expansion programmes to cater to the growing volume of traffic. Towards Some Current and future opportunities this end in view, at various major ports are as follows: ? The Indian Government has been Chennai encouraging private sector participation in port development since 1996. The ? Creation of mega container terminal major areas that have been thrown for a capacity of 4 milion TEU on a open for private investment, mainly on BOT basis at the Chennai port. The Build, operate and transfer with revenue project is at the RFP stage. sharing mechanism include cargo ? Construction of a marina near the handling berths, container terminals, port warehousing facilities, dry docks and ? A dry port at Sriperumbudhur ? ship repair facilities. Container Freight Station which is at a DPR stage. ? 100% FDI is permitted for construction JNPT and maintenance of ports as well as harbours. UK Trade & Investment Sector briefing: Ports sector in India ? Development of a standalone container handling facility with a quay length Among the maritime state Gujarat has had a 330mts towards north. The project is at successful track record of developing ports on RFQ stage. a PPP model some of which are Pipavav, ? Development of fourth terminal and a Mundra, and Dahej. The Gujarat maritime marine chemical terminal in two phases Board has plans to develop 11 green field ports on a BOOT basis (30 years concession) and the Cochin pipeline projects include Dholera, Positra, Chhara, Vansi-Borsi and Bedi. ? Outer harbour development ? Facilities for handling bulk commodities Orissa and bagging plant The state government of Orissa has awarded Ennore development of Dhamra port to a JV, Dhamra Port Company Limited (DPCL) which is a Joint ? World class container terminal under Venture between L&T and Tata Steel. The first construction on a PPP model at a cost of phase is nearing completion. £200 million for a capacity of 1.5 million TEUs per annum. Andhra Pradesh ? The port is planning to add a LNG terminal at a cost of over £350 million Phase I of the development of Krishnapatnam for a capacity of 5 MTPA. Port is complete. The State Government is planning the second phase of Krishnapatnam Paradip port at a cost of £600 million. Machilipatnam and Nizampatnam are under development by ? Construction of Western dock system private developers. consisting of 6 berths. DPR, EIA (environment assessment impact) and The Government has also identified detailed engineering studies are in Bhavanapadu, Kalingapatnam and Narsapur progress. ports for development under PPP model. ? The port is constructing an iron ore berth for a capacity of 10 MT on a BOT basis. Karnataka The project is expected to finish in 2013. Karnataka is planning to develop a port at Haldia Tadri on BOOST basis. The state is looking to developing inland water ways along its ports ? The port has invited bids for for which a few DPRs have been commissioned. constructing Haldia dock II along with all required facilities on a DBFOT basis Maharastra for a concession period of 30 years Maharastra state is developing a number of New Mangalore ports with private sector participation Jaigarh port has been developed by JSW infrastructure ? The port is planning a container on a BOOST basis ? 50 year concession. The terminal and a POL berth. port opened in 2009. The port is planning additional facilities like LNG terminal, Ro-Ro Kandla facility and container terminals. Other ports such as Dighi, Rewas(Reliance) and Redi are ? Development of dry bulk terminal off under various stages of development. Veera outside Kandla creek ? Setting up of off shore liquid terminal Characteristics of the market Non major ports Ports have shown the way for successful Indian maritime States are collectively planning involvement of private sector in India. Indian to spend £ 23 billion in the non major ports to Government in January 2011 announced a new create additional capacity of 1293 MT by 2020. Maritime Agenda (2010-20) entailing an Gujarat investment of nearly £70 billion for capacity UK Trade & Investment Sector briefing: Ports sector in India building, modernisation and expansion in the Major events and activities ports and shipping sectors. Of this, nearly £42 billion will be invested in the ports sector to International Port Project seminar, London enhance ports capacity in India to 320 Mt by 8 November 2011 2020. The balance will be spent on the marine sector. A one day seminar looking at future projects in the Baltic States, Africa and India. The The highlights of the maritime agenda are: afternoon session will focus on the ports sector in India with speakers from Larsen & Tourbro, ? Create port capacity of 3200 MT for Gammon and Kakinada Seaports Limited. handling 250 MT of cargo. ? Increase tonnage under Indian flag as Contact: UKTI Ports Sector Team well as Indian control. Email: Jason.Castelino@ukti.gsi.gov.uk ? Increase India?s share of global ship bu Ports Trade Mission to India: 20-24 ilding to 5%. February 2012 ? Promote use of inland waterways for cargo movement. UK Trade & Investment will be arranging a ? Develop two new major ports- one each trade mission to India to meet key decision on the east and west coast. makers in the ports sector. The programme is ? Major ports to have draft of not less likely to include a visit to Mumbai where a high than 14 mts and hub ports 17 mts. profile networking event will be arranged. ? Development of two hub ports each on the east and west coasts- JNPT and Contact: UKTI Ports Sector Team Cochin in the west; Chennai and Email: jason.castelino@ukti.gsi.gov.uk Visakhapatnam in the east. ? Corporatisation of major ports For details of events related to this country or ? Establishing ?Indian Ports Global? for sector, use the events search on the UKTI overseas investments by Indian ports. website or register to receive regular updates. New export events are added daily. The maritime agenda opens up numerous opportunities for companies from the UK. UKTI?s Tradeshow Access Programme (TAP) provides grant support for eligible Small & If you have any questions about opportunities Medium Sized Enterprises (SMEs) to attend in the local market, get in touch with the trade shows overseas. contacts listed at the end of this report. Business opportunities aimed at UK companies UKTI contacts are added daily to the UKTI website. These leads are sourced by our staff overseas in Jayalakshmi Jayaraman British Embassies, High Commissions and Senior Trade & Investment Adviser Consulates, across all sectors and in over 100 m British Deputy High Commission, Chennai arkets. You can search for opportunities by Tel: (0091 44) 4219 2151 sector or country, or register to receive Email: Jayalakshmi.Jayaraman@fco.gov.uk business opportunity alerts on a regular basis. Kimberly Francis Trade & Investment Adviser British Deputy High Commission, Chennai Tel: (0091 44) 4219 2190 Email: Kimberly.francis@fco.gov.uk UK Trade & Investment Sector briefing: Ports sector in India Next steps - how UKTI can help British companies wishing to develop their business in the local market are advised to undertake as much market research and planning as possible in the UK. UKTI?s local team, with its wide local knowledge and experience, can provide a range of services to British-based companies wishing to grow their business in global markets. This can include: ? Provision of market information ? Validated lists of agents/distributors ? Key market players or potential customers in the local market ? Establishment of interest of such contacts in working with you ? Arranging appointments ? Organise seminars or other events for you to meet contacts and promote your company in the local market This work is available via our Overseas Market Introduction Service (OMIS) a chargeable service which assists British-based companies wishing to enter or expand their business in overseas markets. To find out more about commissioning this work, or accessing other UKTI services and specialist advice, please visit the UKTI website to find contact details for your local UKTI office. Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2011 by UK Trade & Investment. Crown Copyright © You may reuse this information (not including logos, images and case studies) free of charge in any format or medium, under the terms of the Open Government Licence. To view this licence, visit www.nationalarchives.gov.uk/doc/open-government-licence/ or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: psi@nationalarchives.gsi.gov.uk This publication is also available from our website at www.ukti.gov.uk or for more information please telephone +44 (0)20 7215 8000. UK Trade & Investment Sector briefing: Ports sector in India
Posted: 28 July 2011, last updated 29 July 2011

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