India's Major Ports Fight to Ease Congestion

India’s largest container port took delivery of two new super post-Panamax rail-mounted ship-to-shore cranes this week, the largest yet to be installed in the nation.

The cranes, each 115m high and weighing 1,500 tons, were delivered to Jawaharlal Nehru Port (also known as Nhava Sheva) on December 20 by odd dimension cargo and heavylift specialist Super Freight.

The cranes are the latest development in a $650m upgrade that forms part of the Indian government’s plans to ease congestion in its major ports. The Modi government, elected in May 2014, is setting plans in place to double the capacity of major ports from 800 million tons to 1.6 billion tons over the next five years. This will be supported by infrastructure projects designed to improve port connectivity.

Jawaharlal Nehru Port is located south of Mumbai in Maharashtra on the Arabian Sea, and it currently handles around 56 percent of the country’s containerized cargo. By the end of the decade it is anticipated that it will handle over 10 million TEU and be amongst the world’s top 10 container ports. A new special economic zone is being built at the port which is anticipated to take advantage of a new dedicated freight corridor and the proposed Navi Mumbai International Airport expected to be operational by 2019.

On the other side of the country, state-owned Viskhapatnam Port is set to double to one million TEU annually after the signing of a $100m construction contract to extend the berth of the Visakha Container Terminal. This will facilitate increased container traffic and enable the port to better serve India’s central hinterland up to New Delhi. The extension is being built by DP World and Mumbai-based J.M. Baxi Group.

Infrastructure problems have been on-going in India, limiting the ports’ ability to receive larger vessels. The average size of container ships handled in India is 5,000 TEU, reports the Journal of Commerce (JOC), and at least 50 percent of the current orderbook of vessels is too large to be received by Indian ports.

India’s state-run ports have been losing out to its private competitors. JOC reports that their share of business has no dropped from 91 percent in 1995 to 57 percent.

India competes regionally with transshipment hubs in Colombo and Singapore, and Modi’s port development plans have been received positively by business.

“While infrastructure bottlenecks are present, the government is taking decisive steps to resolving them, which sets the stage for a growth boost. As per our estimates, we think India can grow at an average rate of 7-8 percent per annum in the next decade,” a recent report from Barclays referenced by JOC states.

And despite some restrictions due to the crane replacement project, throughput at Jawaharlal Nehru Port is improving. The port reported 10.8 percent growth in container traffic between April and November, giving it a leading position in the overall 8.32 percent increase experienced by India’s major ports.

Image courtesy of Super Freight.