Ports in India: Where to Find the Most Efficient Port
Ports in India handle 90 percent of the country’s export-import cargo by volume and 70 percent by value. Accordingly, the quality of port infrastructure and its operational efficiency plays a critical role in improving the competitiveness of importers and exporters in the country.
For example, a recent analysis by Goldar and Paul (Ideas for India), shows that reducing the average turnaround time of a ship – the duration when the vessel reports at the anchorage of a port to the time of its departure –by 50 percent can boost India’s manufacturing exports by at least 20-25 percent.
Accordingly, businesses that want to import or export in India should seek to identify the most efficient ports in India as part of their site selection process.
In this article, India Briefing examines the current state of India’s port sector: the latest trends and performance metrics, as well as the most recent measures adopted by the government to improve port productivity.
India’s port sector
India is the sixteenth largest maritime country in the world, with a coastline of about 7,517 km. It has 13 major ports and about 200 non-major or intermediate ports spread evenly across its eastern and western coastline.
The ports differ substantially in topography, ranging from deep-sea ports to tidal ports and river ports, and have the capacity to handle all major commodities, including dry bulk (coal, iron ore), containers, break bulk, and liquid bulk.
In the last five years, cargo traffic at these ports has grown at a compound annual growth rate (CAGR) of 4.74 percent, reaching 1,171 million tones (mt) in 2017-18. Of this, major ports handled 58 percent of the total traffic in 2017-18.
In terms of major commodities, dry bulk accounted for 39 percent of the cargo traffic, followed by liquid bulk (36 percent), containers (17 percent), and other commodities including break bulk (8 percent).
Performance efficiency of ports
India’s major ports have shown a significant improvement in the average turnaround time (reducing from 3.64 days to 2.14 days) and berth productivity (increasing from 14,576 tons to 15,333 tons) in the last one year.
Among the 13 major ports, Cochin recorded the shortest average turnaround time at 1.10 days – a substantial improvement from its 1.87 days, a year earlier. Ship calls at Jawaharlal Nehru Port Trust (JNPT) in Navi Mumbai, India’s busiest container gateway, took an average of 1.61 days, compared with 2.24 days previously.
While a lowering of the turnaround time indicates significant improvement in ports’ competence, the average dwell time at India’s ports remains considerably low compared to leading International ports such as Singapore, Rotterdam, and Shanghai.
The turnaround time at these ports is anywhere between one and two days on an average, and sometimes even less than a day (as shown in the figure below).
In 2016, the Indian government passed the Central Port Authority Act that grants more autonomy to the major ports. It also released the revised Model Concession Agreement (MCA) to make port sector more investor friendly.
Under its Sagarmala initiative, the government has proposed a total of 189 projects for modernizations of ports, and about 116 initiatives under project UNNATI to identify opportunity areas for improvement in the operations of major ports.
In the latest Economic Survey 2018-19, India’s Shipping Ministry has identified several parameters for simplifying customs procedures and eliminating bureaucratic barriers to lower cargo dwell times, as well as handle rising trade volume at major ports.
These include widespread digitization, customs’ reforms such as direct port delivery and direct port entry services, elimination of manual forms, accommodation for laboratories to participating government agencies, installation of container scanners, e-delivery orders, and radio frequency identification-based gate automation system.
As the government makes progress against these initiatives, importers and exporters should benefit from greater efficiency at ports in India.