India OKs Port Projects to Double Container Capacity

India OKs Port Projects to Double Container Capacity

The Indian government has approved plans to develop five new cargo terminals, including four major container facilities, at various state-owned ports through public-private partnerships, as part of its $110 billion port capacity-building program.

The planned projects, cumulatively estimated to cost Rs. 17,630 crore (approximately $2.8 billion), include a fourth container terminal at Jawaharlal Nehru Port (Nhava Sheva) and new box facilities at the ports of Ennore, Kandla and Kolkata, as well as a multi-purpose terminal at Mumbai Port.

“The proposed container projects will double the container handling capacity of major ports and will add capacity to the tune of 11.6 million TEUs,” an official statement said. “These facilities will go a long way in promoting the export-import trade of the country and would also reduce transaction costs by improving efficiency in handling operations.”

The government approval is expected to help speed up the awarding of concession contracts by various port authorities, which are in the process of seeking bids from private investors. ”We will be in a position to announce the winning bidder by the end of this month and sign the contract within this fiscal year (ending March 31, 2014),” a Nehru Port official said.

Nehru’s fourth terminal plan, which hit a roadblock following PSA International’s exit from the first tender, comprises a single terminal with a total berth length of 2 kilometers (about 1.2 miles) and throughput capacity of 4.8 million containers a year, requiring an estimated investment of $1.3 billion.

India has 12 major publicly owned ports, equally spread over the west and east coasts, which cumulatively handled 546 million tons of cargo in fiscal year 2012-13, which ended March 31, 2013, a 3 percent decline over the previous year. Consolidated container throughput was relatively flat year-over-year, at 7.71 million TEUs.

New Delhi is working on plans to construct another two major ports  — one at Sagar Island in West Bengal and the other atDugarajapatnam in Andhra Pradesh  — with a total investment of approximately $2.6 billion.