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Major ports need to step up productivity - 2012-04-09

It may be a matter of some concern that the cargo throughput of Indian major ports retreated 1.73 per cent, for the first time in years, in the just-ended fiscal. Admitted that a sharp fall in iron ore shipments was the reason for the fall, which would recover this year. But what is of bigger trepidation is that the Government-run 12 major ports hardly reflected any significant improvement in productivity parameters such as ship turnaround time and pre-berthing delay. In spite of plans to infuse mechanisation and increase cargo-handling capacities, Indian ports are still a far cry from ports such as Rotterdam or Singapore in terms of productivity and efficiency.

“Pre-berthing delays still exist in our major ports and our aim is to totally eliminate them in the current Plan Period. Draft restrictions pose another challenge to the ports sector,” Mr A. Janardhana Rao, Managing Director of Indian Ports association, told Business Line. During 2011-12, the major ports put together rustled up a cargo volume of 560 million tonnes (mt), mirroring a fall of 1.73 per cent from that of the previous fiscal (570 mt). This constitutes nearly 70 per cent of India's external trade in volume terms. This is mainly ascribed to the fall in iron ore movement, thanks to the ban on mining in Karnataka and a move by the Government to save the critical raw material for the domestic steel sector. Iron ore exports sank by nearly 17 mt, or 30.39 per cent; the ports handled 60 mt of the commodity last year, as against 87 mt the year before. Flow of other major cargoes was more or less at the same level. For instance, crude oil and petroleum products maintained the level of 179 mt in the last two years, as also finished fertilisers at about 12 mt.

While thermal coal traffic increased, coking coal movement dipped. Last fiscal, the ports handled 50.3 mt of thermal coal as against 43.6 mt in the previous year, while coking coal movement to ports was at 27.9 mt, as against 29 mt, a dip of 4 per cent.Although globally containerisation of ocean cargo movement is being given a push, container traffic in India did not register the desired hike. The total container traffic last fiscal was 120 mt (or 7.7 million TEUs), as compared to 114 mt (7.5 million TEUs). Nearly half this load, about 58.2 mt, was carried by the Jawaharlal Nehru Port Trust (JNPT), followed by Chennai with 30 mt (1.5 million TEUs).

The Kandla port in Gujarat once again emerged as India's premier port in terms of throughput — it handled 82.5 mt during the year, up from 81.8 mt in the previous year. The Visakhapatnam port, which for several years had occupied the top position before Kandla replaced it, was second with 67.4 mt — its traffic however declined by 0.91 per cent as compared with the previous year, as it is one of the major ports for iron ore shipment. Mormugao and Kolkata registered the biggest fall in cargo volumes. Mormugao's throughput fell 22 per cent to touch 39 mt (50 mt), while Kolkata (Kolkata Dock System and Haldia Dock Complex) tanked by 9.04 per cent at 43.2 mt. On the other side of the spectrum, Ennore port registered the biggest increase in volume with 35.85 per cent during the year.

Improvement of productivity parameters, increasing of port draught and taking up modernisation and expansion at a faster clip remain a challenge. And these are taking a toll on the productivity of the ports. Last year, the Parliament Committee on Estimates, in a report, had pointed out the turnaround time had improved from 10.10 days in 1990-91 to 3.85 days in 2009-10. But this is a far cry from ports such as Hong Kong, where the ship turnaround time is less than 10 hours.

Says Mr Janardhana Rao: “One of the biggest challenges is draught (as inadequate draught prevents ports to handle bigger ships). Out target in the current Plan is to ensure all ports have a minimum draught of 14 mt and hub ports such as JNPT, Cochin, Chennai and Visakhapatnam, 17 mt.” Indian ports have also been lagging in meeting capacity-addition targets. In the 11{+t}{+h} Plan, about 276 projects envisaging an investment of Rs 1,00,339 crore (based on 2004-05 prices) had been proposed — of this Rs 55,804 crore is for the port sector and the rest for shipping and inland water transport sectors. But, out of the 276 projects, only about 55-odd projects involving a capacity of about 70 mt are complete, while about 80 other projects are under implementation.

Even the Parliamentary Committee in its report had noted “with dismay” that the Government has not been able to create adequate capacity. “The committee fails to understand as to why not even 25 per cent of the targeted projects could not be achieved under the NMDP (National Maritime Development Programme),” the report points out. “Capacity-addition projects should be speeded up, as the port sector is expected to handle 3.2 billion tonnes of traffic by 2020, from the current 1.1 billion,” admits Mr Rao. With ports playing a crucial role in facilitating external trade, which accounts for nearly 40 per cent of India's GDP, this sector should take to a faster course of growth.