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Expertspeak: Integration and differentiation needed

Expertspeak: Integration and differentiation needed

Did the MA 2020 miss the proverbial bull’s eye, or is there an explanation beyond bureaucratic and ministerial walls to the fact that there is still no serious mention of connectivity and integration of interests, and of treating shipping and ports differently? Prakash Tulsiani spotlights the two main missing links in the Agenda.

Maritime Agenda 2020 (MA 2020) has been designed to encourage the development of ports. There are plenty of opportunities, given that India has a long coastline and the economy is expected to continue on its growth trajectory. I expect new private ports to come up in the next decade as well as a good boost to coastal shipping. At APM Terminals we are interested in long term growth and are evaluating various options.

Who will connect the dots?

The biggest challenge is commitment to an integrated approach to port development, which includes the development of road and rail networks. The Indian government has proved time and again that it can achieve great things whenever it has shown focus and commitment. I hope to see the same level of commitment in supporting maritime growth.

It is not enough to build port capacity, the cargo has to be evacuated smoothly and quickly and delivered to international container depots (ICDs) or the end customer on time. Currently, we are way behind international standards. The existing ports in India are struggling with evacuation issues. We urgently need a good network of roads and broad gauge railway lines and dedicated freight corridors. There are major stumbling blocks in terms of land acquisition, etc, that prevent construction of such networks across the country. This needs immediate attention.

Unfortunately, even a plan as broad as the MA 2020 has completely ignored the big issue of hinterland logistics, the road and rail networks, essential for evacuation of goods from ports. Port development has to be addressed holistically, otherwise we will have lopsided development with well developed waterfront facilities but poor land-side infrastructure.

Divider ahead?

The port industry is different from the shipping industry; its needs and challenges are different. Splitting maritime into shipping and ports would be a welcome change. Ports are capital and labour intensive and attract large investments over a stretch of time. The government needs to support PPP projects in ports and support the development of evacuation logistics. We also need assistance to develop different kinds of ports: bulk, containers, automobiles, etc. These are different from the needs of the shipping industry.

We have along way to go to develop inland water services, but this decade may witness the first steps taken towards this direction. I expect coastal shipping to grow demonstrably during this decade. The recently inaugurated International Container Transhipment Terminal (ICTT) at Vallarpadam in Kochi will help the country attract larger ships to its coasts. In fact, larger ships have already started moving from neighbouring countries to private ports in India. This trend will help boost coastal shipping, which, in turn, can reduce the burden of cargo movement on roads and railways, besides being more economical and eco-friendly.

However, as I have mentioned earlier, ports without evacuation facilities are just not going to be able to make a marked difference.

Three key fators for a port:

Location is key and the port has to be located strategically within international shipping routes,
Infrastructure within the port, and
Road and rail networks available for evacuation of the cargo.

Any port that fulfils these three essentials, will be successful. Any port that enjoys a strategic location that offers a deep draught, excellent connectivity to the hinterland, modern infrastructure, and high quality ethical services will turn out to be a profitable venture.

The author is Managing Director, APM Terminals Pipavav.

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