PORTS

For updated information, please visit www.ibef.org July 2017

Table of Content

Executive Summary...3

Advantage India.... 5

Market Overview ...7

Porters Five Forces Framework...16

Recent Trends and Strategies........17

Growth Drivers and Opportunities.......21

Case Studies.......... 31

Key Industry Organisations...35

Useful Information.........37
 EXECUTIVE SUMMARY

Increasing trade activities and private participation in port Total cargo capacity in India (MMT)
infrastructure set to support port infrastructure activity
3000
By FY17, cargo capacity in India is estimated to increase to 2,493.1
MMT from 1,806.8 MMT in FY15 2000 2493.1
1806.8
1000

0
FY15 FY17 E

India has 12 major ports. Cargo capacity at major ports (MMT)

By FY17, cargo capacity at major ports grew to 1,065 MMT in FY17,
1100
from 965.36 in FY16 implying a CAGR of 10.32 per cent.
1050
1065
1000
950
965.36
900
FY16 FY17

The average turnaround time of major ports improved to 3.44 days in Cargo traffic at major ports (MMT)
FY17 from 4.01 days in FY15
660
In FY17, 12 major ports in India handled 647.43 (Million Tonnes) of
cargo, showing a CAGR of 6.79 per cent. 640 647.43
620
600
606.37
580
FY16 FY17
Notes: E Estimates,MMT - Million Metric Tonnes
Source: Ministry of Shipping

3 IT and ITeS For updated information, please visit www.ibef.org

 EXECUTIVE SUMMARY

Indias 200 non-major ports are strategically located on the worlds Cargo capacity at non-major ports
shipping routes
1000
In FY17, cargo traffic at non-major ports in India is estimated to grow
to 815.2 MMT from 466.1 MMT in FY16 815.2
500
466.1

0
FY16 FY17 E

Trade to boost demand for containers Container demand in India

By FY17, container demand in India (For major ports) is estimated to
30
increase to 21 million TEU from 8.2 million TEU in FY16
20
21
10
8.2
0
FY16 FY17 E

Infrastructural development to increase demand for iron and steel Iron ore traffic
By FY17, iron ore traffic (For Major and Minor ports) is estimated to
300
rise to 228 MMT from 43.6 MMT in FY15
200 228

100
43.6
0
FY15 FY17
Notes: E Estimates, TEU Twenty Foot Equivalent Unit, MMT - Million Metric Tonnes
Source: Ministry of Shipping

4 IT and ITeS For updated information, please visit www.ibef.org

 IT and ITeS

ADVANTAGE INDIA
 ADVANTAGE INDIA

CAGR in traffic : Non-major ports are set to benefit from

strong growth in Indias external trade
Non-major ports: is estimated to grow at
CAGR of 15.9 per cent and reach 815 Special Economic Zones are being
MMT in 2017 . developed in close proximity to several
ports comprising coal-based power
During FY 2016-17, 12 major ports in India
plants, steel plants and oil refineries
handled 647.43 (Million Tonnes) of cargo,
showing a growth of 6.79 per cent in
comparison to the same time during
previous year.

ADVANTAGE
INDIA
India has a coastline which is more than The government initiated NMDP, an
7,517 km long, interspersed with more initiative to develop the maritime sector;
than 200 ports the planned outlay is US$ 11.8 billion
Most cargo ships that sail between East FDI of 100 per cent under the automatic
Asia and America, Europe and Africa pass route and a 10n year tax holiday for
through Indian territorial waters enterprises engaged in ports
India is the largest importer of thermal coal
Plans to create port capacity of around
in the world
3200 MMT to handle the expected traffic
of about 2500 MMT by 2020

Note: FY Indian Financial Year (AprilMarch), NMDP National Maritime Development Programme, FDI Foreign Direct Investment, US$ US Dollar,
E Estimated, MMT Million Metric Tonnes, CAGR Compound Annual Growth Rate
Source: Report of the Task force on Financing Plan for Ports, Government of India

6 IT and ITeS For updated information, please visit www.ibef.org

 IT and ITeS

MARKET
OVERVIEW
 CATEGORIES OF PORTS IN INDIA

Ports in India (2016)

Major Non-major (minor)

There are 12 major ports in the India has about 200 non-major
country; 6 on the Eastern coast ports of which one-third are
and 6 on the Western coast operational

Major ports are under the Non-major ports come under the
jurisdiction of the Government of jurisdiction of the respective state
India and are governed by the Governments Maritime Boards
Major Port Trusts Act 1963, (GMB)
except Ennore port, which is
administered under the
Companies Act 1956

Source: Ministry of Shipping

8 IT and ITeS For updated information, please visit www.ibef.org

 MAJOR PORTS IN INDIA

Kandla
Kolkata

Paradip
Mumbai
JNPT Visakhapatnam

Mormugao

New Mangalore Ennore

Chennai

Cochin

Note: JNPT Jawaharlal Nehru Port Trust

9 IT and ITeS For updated information, please visit www.ibef.org

 CARGO TRAFFIC IS ON THE RISE (1/2)

Cargo traffic at major ports in India: Cargo traffic at major ports (MMT)
Stood at 647.43 MMT in FY17, growing at a CAGR of 4.02 per cent
from FY07-FY17. 700 CAGR 4.02%
During FY 2016-17, 12 major ports in India handled 647.43 (Million

647.43
Tonnes) of cargo, showing a growth of 6.79 per cent in comparison 600

606.37
to the same time during previous year.

581.3
569.8
561

560.1

555.3
546.6
As of March 2017, 16 new cargo scanners are installed across major

530.4
500

519.2
ports in India. In the 1st phase, 5 of the 13 major ports i.e. Kamarajar
(Ennore), New Mangalore, JNPT, Kolkata and Vizag will receive the

436.6
scanners, which should be operational in the next six months. 400

300

200

100

0
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17

Note: MMT Million Metric Tonnes, CAGR Compound Annual Growth Rate, FY Indian Financial Year (AprilMarch), E Estimated, Aranca Research
Source: Ministry of Shipping

10 IT and ITeS For updated information, please visit www.ibef.org

 CARGO TRAFFIC IS ON THE RISE (2/2)

Percentage share of ports Cargo traffic at non-major ports (MMT)

120%
900 CAGR 15.9%
100% 800

815.2
71.4% 28.6%

71.8% 28.2%

71.3% 28.7%

34.0%

35.6%

38.7%

41.6%

42.9%

44.8%

43.5%

46.4%
700
80%
600
60% 500
66%

64.4%

61.3%

58.4%

471.2
57.1%

466.1
56.5%
400

55.2%

53.6%

417.1
40%

387.9
300

353
314.9
289.9
20% 200

186.1

203.6

213.2
100
0%
0
FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

FY17 E

FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

FY17 E
Major Ports Non-major Ports
Non-major ports are evolving faster than major ports: Cargo traffic at non-major ports
Non-major ports are gaining shares and a major chunk of traffic Stood at 466.1 MMT in FY16
has shifted from major ports to non-major ports Cargo traffic has expanded at a CAGR of 10.7 per cent during
The contribution of non-major ports traffic to total traffic rose to FY0716 and is expected to grow annually at 15.9 per cent during
43.5 per cent in FY16 from 28.6 per cent in FY07 FY07-17
Cargo traffic in 2017 at non-major ports is estimated to reach
815.2 MMT

Note: MMT Million Metric Tonnes, CAGR Compound Annual Growth Rate, FY Indian Financial Year (AprilMarch), E Estimated
Source: Ministry of Shipping

11 IT and ITeS For updated information, please visit www.ibef.org

 CARGO PROFILE AT MAJOR PORTS IN INDIA (1/2)

Cargo at major ports in FY16 Cargo at major ports in FY171

Liquid (petroleum, oil Liquid (petroleum, oil

Solid Container Solid Container
and lubricants) and lubricants)

Share: 46.4% Share: 33.3% Share: 20.3% Share: 47.97% Share: 32.89% Share: 19.15%

Iron ore Share: 2.1% Iron ore Share: 14.06%

Coal Share: 22.7% Coal Share: 46.09%

Fertilizer Share: 2.6% Fertilizer Share: 5.03%

Other cargo Share: 18.9% Other cargo Share: 34.82%

Note: Other cargo includes Fertiliser Raw Material (dry) and food-grains; 1 - Data from April 2016-December 2016
Source: Ministry of Shipping

12 IT and ITeS For updated information, please visit www.ibef.org

 CARGO PROFILE AT MAJOR PORTS IN INDIA (2/2)

Between FY07 FY17, cargo traffic grew at CAGR 0.38 per cent Cargo traffic at major ports (MMT)
Over FY0716, CAGR in the volume of different segments was as
follows 700.0
Solid cargo was 2 per cent

Liquid cargo was 3.1 per cent 600.0

123.2
119.4
114.1

101.2

120.1
Container cargo was 6 per cent

114.6
119.8
93.1
500.0

92.3
Cargo traffic during FY17 (Till December 2016) for solid, liquid and

195.9

92.1
154.3 73.2

188.9
175.1
container cargo was 230.8, 158.2 and 92.13 MMT, respectively

179.1

187.2
179.1
176.1
400.0

168.7

185.9
During April-October 2016, cargo traffic at 12 major ports in the

158.2
country was reported at 370.04 MT, showing a growth of 6.27 per
300.0
cent over the same period during the previous year

287.4
284.7

276.6

273.0
261.2

260.9
258.2

253.5
239.9
235.9

230.8
200.0

100.0

0.0
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17

Solid Liquid Container

Note: E estimate, Other cargo in Solid includes fertiliser raw material (dry) and food-grains; 1 - Data from April December 2016
Source: Ministry of Shipping; Indian Ports Association (IPA),

13 IT and ITeS For updated information, please visit www.ibef.org

 INCREASE IN CAPACITY OVER THE YEARS

Capacity at major ports grew to 1,065 MMT in FY17, implying a

CAGR of 7.75 per cent since FY07 Capacity and utilisation at major ports (MMT)
Despite capacity increasing, utilisation rates have been gradually
coming down post the global economic meltdown in FY08 1200 120.0%

Utilisation rates of major ports in India such as JNPT port, Kandla port,
Ennore port, etc., are much above the worlds average

1065
1000 100.0%
As of November 2016, 12 Major Ports were identified under Sagarmala

965.36
project, for cargo handling till 2035. The objective of this project is to

871.52
promote port led development and to provide infrastructure to quickly 800 80.0%

800.52
transport goods to and from ports, with higher efficiency and at lower

744.9
cost.

689.8
670.1
600 60.0%
Indian Port Rail Corporation Ltd. (IPRCL), plans to conduct rail

616.7
574.8
infrastructure expansion and modernisation work for JNPT, Kandla Port

532.1
504.8
and Haldia Dock Complex in April 2017. Similar works have already
400 40.0%
started for Kolkata, Vishakhapatnam, Tuticorin, Mangalore and Chennai
ports.

Germanys Deutsche Bahn Engineering and Consulting plans to form a 200 20.0%
JV with Indian Port Rail Corp. Ltd (IPRCL) with an aim to connect Indian
ports with railways. Germany and India are working on projects worth
US$14.87 billion being implemented by IPRCL 0 0.0%

FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

FY17
In May 2017, the government of India laid the foundation stone for
various projects of the Kandla port. The construction of the Chabahar
port will further encourage the growth of the Kandla port. The port has
been renamed as Deendayal Port Trust Kandla.
Note: MMT Million Metric Tonnes,
Source: Ministry of Shipping; Indian Ports Association (IPA),

14 IT and ITeS For updated information, please visit www.ibef.org

 DROP IN TURNAROUND TIME

Average turnaround time is influenced by factors such as type of Average turnaround time for major ports (in days)
cargo, parcel size and entrance channel

The average turnaround time improved to 3.44 days in FY17 from 6

4.01 days in FY15

5 5.29

4.63 4.56
4 4.2 4.29
4 4.01
3.8 3.84
3.64
3.44
3

0
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17

Note: Turnaround time Total time spent by a ship from entry into port until departure
Source: Ministry of Shipping, Indian Port Association

15 IT and ITeS For updated information, please visit www.ibef.org

 Porters Five Force Framework Analysis

Threat of Substitutes

Low With rising demand for port

infrastructure due to growing imports
(crude, coal) and containerisation, the
threat of substitute products to remain
weak

Bargaining Power of Suppliers Competitive Rivalry Bargaining Power of Buyers

Medium Considerable capacities to
be added going forward. However,
demand to continue to remain strong
Low Increasing trade activities Medium Imports to continue to
brought by rising imports of remain strong led by strong demand.
commodities like coal and crude to However considerable port capacities
generate higher business and limit
to be added going forward
overall competition as most ports
handle specific geographies

Threat of New Entrants

Medium 100 per cent FDI under

automatic route and income tax
Positive Impact
exemption (10 years) is attracting
Neutral Impact foreign players. However, higher
Negative Impact capital expenditure acts as a barrier

Source: PricewaterhouseCoopers, Techopak

16 IT and ITeS For updated information, please visit www.ibef.org

 IT and ITeS

RECENT TRENDS
AND STRATEGIES
 NOTABLE TRENDS

Strong growth potential, favourable investment climate and sops provided by state governments have encouraged
Increasing private
domestic and foreign private players to enter the Indian ports sector. In addition to the development of ports and
participation
terminals, the private sector has extensively participated in port logistics services

SEZs are being developed in close proximity to several ports, thereby providing strategic advantage to industries
within these zones. Plants being set up include

Coal-based power plants to take advantage of imported coal

Setting up of port- Steel plants and edible oil refineries

based SEZs
Development of SEZs in Mundra, Krishnapatnam, Rewas and few others is underway

Government has announced plans to develop 14 CEZs (coastal economic zones) in a phased manner for port-led
development in all the 9 maritime states by advancing efforts to develop 1 new port, each on the east and the west
coast`

All the greenfield ports are being developed at shores with natural deep drafts and the existing ports are investing on
improving their draft depth.
Focus on draft
depth Higher draft depth is required to accommodate large sized vessels. Due to the cost and time advantage associated
with the large sized vehicles, much of the traffic is shifting to large vessels from smaller ones, especially in coal
transportation

Government of India is targeting to make the country the first in the world to operate all 12 major domestic government
Ports to operate on
ports on renewable energy. The government plans to install almost 200 MW wind and solar power generation capacity
Green energy
by 2019 at the ports. The energy capacity could be ramped up to 500 MW in future years.

Note: SEZ Special Economic Zone, PPP Public-Private Partnership

Source: Ministry of Shipping

18 IT and ITeS For updated information, please visit www.ibef.org

 NOTABLE TRENDS

Terminalisation: Focus on terminals that deal with a particular type of cargo

Specialist terminal- This is useful for handling specific cargo such as LNG that requires specific equipment and hence high capital costs.
based ports Forming specialist terminals for such cargo result in optimal use of resources and increased efficiencies

Examples of specialist terminals: ICTT in Cochin, LNG terminal in Dahej Port

The Haldia Port of West Bengal was rated as the cleanest port among all the major ports in the 1st ever ranking by the
Sanitation Ministry of Shipping. The ranking of major 13 Indian ports was conducted by the Quality Council of India (QCI) during
the 'Swachhta Pakhwada.

To promote private investments, the government has reformed the organisational model of seaports

From: A service port model where the port authority offers all the services
Landlord port
model To: A landlord port model where the port authority acts as a regulator and landlord while port operations are
carried out by private companies

Major ports following landlord port model: JNPT, Chennai, Visakhapatnam and Tuticorin

With the increasing private participation in establishing minor ports. Cargo traffic handled by the minor ports are
Rising traffic at non
outpacing cargo traffic at major ports, cargo traffic at non major port stood at 466.1 MMT in FY 16 and is estimated to
major ports
reach 815.2 MMT in FY17.

Note: ICTT International Container Transshipment Terminal, LNG Liquefied Natural Gas, MMT Million Metric Tonnes
Source: Aranca Research

19 IT and ITeS For updated information, please visit www.ibef.org

 STRATEGIES ADOPTED

Adani group, largest private port operator in India, is now venturing into providing allied services like dredging. Its
Allied activities
dredgers which were being used only at its own ports in the past have now started taking work from other ports

Container train Adani group has also ventured into the container railway business becoming the largest private link in the country. It
operations conducts operations on a pan-India basis operating 6 container rakes

Port authorities are modernising and upgrading port facilities to meet the needs of the port users in competitive
Modernising
environment

After having a strong advantage on Indias West coast, Adani Ports and Special Economic Zone Ltd (APSEZ) is
looking to strengthen its position by winning the bid of a new container terminal at Ennore port located on the east
coast. Furthermore Adani Ports has acquired Dharma Port to replicate its development and growth on the eastern
coast
Pan-India presence
Essar Ports Ltd as a part of it strategic move to increase its potential on the east coast has won the contract for the
modernisation of 3 ports at Visakhapatnam

Essar Ports Ltd., a leading port operator, plans to build a port in Gujarat with investments worth US$1.49 billion. For
the same, the company has signed a MoU with Gujarat Maritime Board (GMB)

Geographic diversification as in the case of Adani group acquiring coal mines (Australia and Indonesia) and setting up
coal terminal in Australia to take the benefit of increasing coal imports in India
Geographic
diversification As of April 2017, Adani Ports is planning to expand and open a multi purpose port on Carey Island in Malaysia, as an
extension of the Port Klang. A MoU was signed between APSEZ and MMC Port Holdings Sdn Bhd, a wholly-owned
unit of MMC Corporation Berhad

Source: Company website

20 IT and ITeS For updated information, please visit www.ibef.org

 IT and ITeS

GROWTH DRIVERS
AND OPPORTUNITIES
 SECTOR BENEFITS FROM STRONG DEMAND,
PRIVATE PARTICIPATION

Policy support Growing demand Innovation Increasing investments

National Maritime
Development Expanding port Increasing
Increasing trade
Programme and development and investments in
activities resulting in
National Maritime distribution facilities building ports and
container traffic
Agenda in India related activities

Inviting Driving Resulting

Rising demand for FDI of up to 100 per Private equity

cent under the Use of modern
coal and other supporting private
automatic route technology
commodities port developers

Various sops and

Growing crude Providing support to Increasing
incentives for private
imports by the global projects from investments by
players to build ports
country India foreign players

22 IT and ITeS For updated information, please visit www.ibef.org

 INDIAS PORTS ARE BENEFITTING FROM STRONG
GROWTH IN EXTERNAL TRADE

Indias total external trade have grown to US$ 416 billion in FY171, Average turnaround time for major ports (in days)
implying a CAGR of 4 per cent done since FY09
600
Ports handle almost 95 per cent of trade volumes; thus rising trade CAGR 3.28%
500
has contributed significantly to cargo traffic

491
489
400

450

448
Increasing trade is translating into higher demand for containerisation

381
370
300
due to their efficiency

314

310
306
304

300
288

262
200

250

241
During FY0717, container traffic rose to 123.2 MMT, implying a

185

179

175
100
CAGR of 5.9 per cent
0
During FY171, container traffic stood at 92.13 MMT

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16
1

FY17
Exports

Container traffic at major ports (MMT)

140 CAGR 2.3%

120

123.2
120.1

119.8

119.4
114.6
114.1
100

101.2
93.1
80

92.3

92.13
73.4
60
40
20
0
FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

FY17
Notes: MMT Million Metric Tonnes 1: Data available for April - December 2016 CAGR: For Imports from FY09-16
Source: Ministry of Commerce, Indian Ports Association

23 IT and ITeS For updated information, please visit www.ibef.org

 PORTS TO BENEFIT FROM GROWING CRUDE
IMPORTS

A consequence of strong GDP growth has been rising energy Crude imports (MMT)
demand; the country currently meets about 75 per cent of total crude
oil demand by imports 250

Indias crude imports touched 202.85 MMT in FY16, implying a 200

202.85
CAGR of 6.9 per cent over FY0716

189.44
189.24
184.8
171.73
150

163.6
159.26
Private ports have been especially good at attracting crude import

132.78
121.67
traffic 100

111.5
POL have been the major contributors to total traffic at ports and 50

53.15
contributed 33.3 per cent in FY16
0

FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16
POL traffic at both major and non-major ports added up to 376.84 1

FY17
MMT in FY16, implying a CAGR of 5 per cent over FY0715

POL traffic in FY17 reached 349.75 MMT

POL traffic (MMT)

40000% CAGR 5%
35000%

180.9
169.8
168.6

191.5
167.3
30000%

156.3
145.4
175.1 137.7
97.8
25000%

168.7 91.0
154.3 81.2
20000%

195.9
15000%

187.2
185.9

181.0
179.1

179.1
176.1

158.3
10000%
5000%
0%
FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16
2

FY17
Major Ports Non-major Ports

Notes: MMT Million Metric Tonnes FY171: Data available for April - December 2016 POL Petroleum, Oil, and Lubricants, 2 - Figures from April December 2016
Source: Handbook of Indian Statistics (RBI), Petroleum Planning and Analysis Cell, Ministry of Shipping

24 IT and ITeS For updated information, please visit www.ibef.org

 INCREASING COAL IMPORTS SET TO DRIVE RISING
CARGO TRAFFIC

India is the largest importer of thermal coal in the world and this is Coal supply gap (import requirement) (MMT)
expected to grow due to increased demand for power

With growing demand for power, coal imports reached to be 156.83 250 CAGR 19.6%
MMT in FY16.
200

212.1
A major chunk of this import is transported by sea

192.5
150

168.5
160.9

156.38
Increasing coal imports are set to drive coal cargo traffic upwards at

132.2
100
both major and non-major ports

83.5
50
Coal cargo traffic has grown at a CAGR of 15.5 per cent over FY07

60
16 to reach 270.3 MMT. 0

Total coal handled by Indias 12 major ports jumped to 126.1 million

tonnes in FY16 from 118.7 million tonnes in FY15

Thermal coal imports through the ports leaped 13.3 per cent to 98.7 Coal cargo traffic (MMT)
million tonnes, while shipments of coking coal, used in making steel,
reached to 27.35 million tonnes 300 CAGR 15.5%
In FY16, the coal traffic by minor ports reached 144.23 MMT 250

158.7

144.2
200

126.3
41.3

109.3
150

21.5
15.4
14.0

FY12 78.8 79.0

FY11 72.7 58.5
100

126.1
118.7
FY14 104.1
FY13 86.6
50

FY10 71.7
FY09 70.4
FY08 64.9
0 FY0759.9

FY15

FY16
Major Ports Non-major Ports
Note: MMT Million Metric Tonnes FY171: Data available for April - December 2016 POL Petroleum, Oil, and Lubricants, 2 - Figures from April December 2016
Source: Ministry of Coal, Ministry of Shipping

25 IT and ITeS For updated information, please visit www.ibef.org

 NATIONAL MARITIME AGENDA 20102020

Increasing capacity To create a port capacity of around 3,200 MT to handle the expected traffic of about 2,500 MT by 2020

Proposed investments in major ports by 2020 are expected to total US$ 18.6 billion, while those in non-major ports
Increasing
would be US$ 28.5 billion. The government is also working to float a specialised Maritime Finance Corporation with
investments
the equity of ports and financial institutions to fund the Port projects

World-class To implement full mechanisation of cargo handling and movement at ports, thereby bringing Indian ports on par with
infrastructure the best international ports in terms of performance and capacity

Major ports have been working towards implementing Landlord port concept duly limiting their role to maintenance of
Landlord ports channels and basic infrastructure leaving the development, operation, management, of terminal and cargo handling
facilities to the private sector

To develop 2 major ports (1 each on East and West coast) to promote trade as well as 2 hub ports (1 each on the
West coast and the East coast) Mumbai (JNPT), Kochi, Chennai and Visakhapatnam

In April 2017, Indian government has approved MoU on passenger cruise services on the coast and protocol routes
Strategically between India and Bangladesh to commence regular movement of tourists and passengers in vessels between the 2
building ports countries.

In May 2017, Commerce and Transport Ministry announced construction of two new ports in Odisha, one at Astarang
in Puri district, and another at Subarnarekha in Balasore district. There are 14 potential sites identified for developing
these minor ports.

Bringing ports To establish a port regulator for all ports in order to set, monitor and regulate service levels, technical and
under regulator performance standards

Source: Ministry of Shipping

26 IT and ITeS For updated information, please visit www.ibef.org

 FAVOURABLE POLICIES ASSISTING THE PRIVATE
SECTOR

The government has allowed FDI of up to 100 per cent under the automatic route for projects related to the
De-licensing and construction and maintenance of ports and harbours
tax holidays A 10-year tax holiday to enterprises engaged in the business of developing, maintaining, and operating ports, inland
waterways and inland ports

Private ports enjoy price flexibility, as the government allows non-major ports to determine their own tariffs in
Price flexibility consultation with the State Maritime Boards; at major ports, tariffs are regulated by the Tariff Authority for Major Ports
(TAMP)

An MCA has been finalised to bring transparency and uniformity to contractual agreements that major ports would
Model Concession enter into with selected bidders for projects under the Build, Operate and Transfer (BOT) model
Agreement (MCA) As on September 2016, the Ministry of Shipping proposed a new model concession agreement (MCA) to attract more
private sector investments in the development of port infrastructure across the country.

Major Port Primary focus of the scheme is to allow future public-private partnership operators to fix tariffs. With the
Authorities Act, implementation of this policy, port authorities will get the power to lease land for port-related use for up to 40 years and
2016 for non-port related use up to 20 years

The system for security clearance for ports being streamline and made faster

Favourable system Expansion of existing framework to attract participation from the private sector for development of infrastructure
facilities such as dredging, road infrastructure, creation of SEZ and development of integrated parking zones in the
port area

In June 2017, India Meteorological department has forecast an above normal monsoon before schedule in the central
Assistance from
and north India. After the onset in May end, the southwest monsoon is to make steady progress over the west coast,
Weather
southern peninsular India and to the east and northeast.

Note: FDI Foreign Direct Investment

Source: Ministry of Shipping

27 IT and ITeS For updated information, please visit www.ibef.org

 STRONG PRIVATE SECTOR PARTICIPATION IN
PORTS PROJECTS (1/2)

Greenfield projects

Private investment

Private terminals

39 Public Private Partnership (PPP) projects are operational at a cost of around US$ 2219.4 million and capacity of 240.72 Million Tonnes Per
Annum (MTPA). 32 PPP projects at an estimated cost of around US$ 3917.6 Million and capacity 264.77 Million Tonnes Per Annum (MTPA)
awarded and are under implementation.

15 PPP projects with an estimated cost of about US$ 1210.6 million and capacity 69.47 Million Tonnes Per Annum (MTPA) have been
awarded/approved and 13 projects at an estimated cost of about US$ 1466.2 Million and Capacity 108.35 Million Tonnes Per Annum (MTPA) are
likely to be awarded/approved by 31.03.2015.

As of September 2016, the National Green Tribunal has given nod for construction of multi-crore Vizhinjam International Seaport Ltd (VISL). The
port is being developed by Adani Group in collaboration with Kerala Government.

2 mega port projects in Colachel in Tamil Nadu and Dahanu in Maharashtra with an initial investment of US$ 2.3 billion has been introduced and
are being awaited for approval under PPP model in FY16.

The Central Government is planning to setup logistic hubs near seaports with the help of private sector players, to augment exports from the
country.

In January 2017, a new container service, operated by K Line, commenced operations between CITPL (Chennai International Container
Terminals Pvt. Ltd) at Chennai port and the Far East.

In May 2017, DP World has agreed to develop Indian port projects and plans to sign an MoU with the National Investment and Infrastructure Fund
(NIIF), the Indian wealth fund. The projects worth US$ 1.3 billion include the development of Sagarmala and Bharatmala projects.

Note: PPP Public Private Partnership

Source: Ministry of Shipping

28 IT and ITeS For updated information, please visit www.ibef.org

 STRONG PRIVATE SECTOR PARTICIPATION IN
PORTS PROJECTS (2/2)

Terminals in major ports

Estimated cost
with private sector Port agency Key private sector companies Ports they developed
(US$ million)
involvement

Container terminal, Ennore Ennore 293.1 Maersk JNPT (Mumbai)

LNG terminal, Cochin Cochin Port Trust 729.1
PandO Ports JNPT, (Mumbai and Chennai)
Container terminal, NSICT JNPT 156.3

Oil jetty related facilities Dubai Ports International (Cochin and Vishakhapatnam)
Kandla Port Trust 156.3
(Vadinar)
PSA Singapore Tuticorin
Third container terminal
JNPT 187.5
(Mumbai) Adani Mundra
Crude oil handling facility
Cochin Port Trust 146.5 Maersk Pipavav
(Cochin)

ICTT at Vallarpadam Navyuga Engineering Company Ltd Krishnapatnam

Cochin Port Trust 262.9
(Cochin)

Construction of SPM DVS Raju group Gangavaram

Paradip Port Trust 104.2
captive berth (Paradip)
JSW Jaigarh
Development of second
container terminal Chennai Port Trust 103.1
(Chennai) Marg Karaikal

Note: NSICT Nhava Sheva International Container Terminal, Mumbai, ICTT International Container Transshipment Terminal, SPM Single Point Mooring
Source: Indian Ports Association

29 IT and ITeS For updated information, please visit www.ibef.org

 OPPORTUNITIES
Increasing Scope for Private Ports
With rising demand for port
infrastructure due to growing imports
(crude, coal) and containerisation,
public ports (major ports) will fall short
of meeting demand
This provides private ports with an
opportunity to serve the spill-off demand
from major ports and increase their
capacities in line with forecasted new
demand.
Cochin Port Trust (CPT) announced
measures to increase its revenue by
generating higher container traffic and
increasing the number of passenger
liners. CPT is also planning to setup a
small industrial port at the southern end
of Willingdon Island to boost business.
Note: OandM Operations and Maintenance
Source: Ministry of Shipping
30 IT and ITeS
Increasing Scope for Private Ports
Dry docks are necessary to provide
ship repair facilities. Out of all major
ports, Kolkata has 5 dry docks, Mumbai
and Visakhapatnam have 2; the rest
have 1 or no dock at all
Given the positive outlook for cargo
traffic and the resulting increase in
number of vessels visiting ports,
demand for ship repair services will go
up. This will provide opportunities to
build new dry docks and setup ancillary
repair facilities.
For updated information, please visit www.ibef.org
Increasing Scope for Private Ports
Operation and maintenance services
such as pilotage, dredging, harbouring
and provision of marine assets such as
barges and dredgers are expected to
increase in coming years
Increasing investments and cargo traffic
point to a healthy outlook for port
support services
These include Operation and
Maintenance (OandM) services like
pilotage, harbouring and provision of
marine assets like barges and dredgers.
JNPT in Navi Mumbai signed an
agreement with Development Bank of
Singapore and State Bank of India, for
external commercial borrowing worth
US$ 400 million for expansion of road
network connecting the port.
 IT and ITeS

CASE STUDIES
 MUNDRA: THE LARGEST PRIVATE PORT IN INDIA

Mundra Port and Special Economic Zone Ltd was renamed as Adani Net sales (US$ million)
Ports and Special Economic Zone Ltd

It is the largest private port in India in terms of volume 1400

Net Sales (FY16): US$ 1213.1 million

Operating profit (FY16): US$ 710.5 million 1200

1213.1
Adanis Mundra Port crosses 100 MMT mark of cargo handling in
FY16. The only commercial port in India to achieve 100 MMT traffic. 1000

1020.6
Further, cargo traffic of the company touched 109.02 MMT in FY16

Container traffic contributed the most, followed by coal and edible 800

801.2
oil, chemicals and POL

Has the worlds largest fully mechanised coal terminal with a

658.6
600
capacity of 60 MTPA

575.4
Handles the 2nd highest container traffic in India 400

439.5
During FY0816, total revenue rose to US$ 1213.1 million, implying

300.7
a CAGR of 25 per cent

255.7
200

202.9
Adani Group plans to convert the Dhamra Port, in Odisha, into
country's biggest seaport with industrial park, and set up LNG and 0

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16
LPG terminals there by 2021.

Dhamra Port is expected to have 35 berths having 315 million tonnes

capacity.

Source: Ministry of Shipping

32 IT and ITeS For updated information, please visit www.ibef.org

 JNPT: MAJOR PORT WITH THE LARGEST CONTAINER
CAPACITY

Jawaharlal Nehru Port Trust (JNPT) has the 3rd highest cargo traffic Cargo profile of JNPT (FY17)
and the highest container traffic in the country

Total traffic handled at JNPT for FY17 was 62.15 million tonnes
It is a container-focused port and having container traffic of 54.53 million
tonnes in FY17
Handled 4.5 million TEUs of containers by the year FY17 1.4%

Distribution of JNPTs container traffic for FY16 across its various

terminals was a s follows : 10.9%
Jawaharlal Nehru Port Container Terminal (JNPCT): 1.53 million
TEUs Container
Nhava Sheva International Container Terminal (NSICT): 0.73 million Liquid
TEUs
Others
APM Terminals: 1.79 million TEUs
JNPT was developed to relieve the pressure of Mumbai port and was 87.7%
commissioned in 1989
It serves most of North India and has good hinterland connectivity
through road and rail networks
JNPT, with a capacity of 4.5 million TEU, handles over 58 per cent of
Indias container traffic
JNPT is a pioneer in involving private sector participation in major ports
and operates under a landlord model; NSCIT is the 1st private terminal
in the country
Note: TEU Twenty-Foot Equivalent Unit, MMT Million Metric Tonnes, MTPA Million Tonnes Per Annum
Source: Ministry of Shipping, JNPTs website, Indian Ports Association

33 IT and ITeS For updated information, please visit www.ibef.org

 GUJARAT: PORT HUB OF INDIA

Gujarat is endowed with 1,215 kilo meters of coastline i.e. 1/6th of Cargo handled at major and non-major ports of Gujarat (MMT)
total Indian coastline

The state has 42 ports of which 41 are non major, while Kandla is the 400
350
sole major port 300

340
336
310
250

288
During FY0716, cargo traffic in Gujarat increased at a CAGR of 10.17

259
200

80.97
231
per cent, with the cargo volume handled reaching 440 MMT in FY16.

206
150

153
151
100

131

100
Favourable policies of the Gujarat government helped the state in

72

80

82

83

94

87

92
50

65
53
gaining private investors interest in port related activities 0
1

FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

FY17
Kandla port handled 499.68 million tonnes of cargo traffic, during April
2016 to January 2017. Overall Indias cargo traffic increased by 7.14 per
Major Ports Minor Ports
cent.
In FY16, Gujarat Maritime Board (GMB) handled 339.77 MMT of cargo,
Greenfield ports Developer
with a capacity addition of 466 MMT in the same year.
With seven ports under construction and 5 proposed ports, Gujarat has Port of Pipavav GMB and Gujarat Pipavav Port Ltd
the highest number of privately operated greenfield ports in India
Mundra Port Gujarat Adani Port Ltd
As of October 2016, Ministry of Shipping has sanctioned Capital
Dredging Project for Ro Pax Ferry Services between Gogha and Dahej, Dahej Port Petronet LNG Ltd and GMB
in Gulf of Cambay in Gujarat. The total project cost is US$ 35.75 million,
of which 50 per cent will be funded by Centre Government under the Hazira Port Shell Gas B.V.
Sagarmala programme
As of November 2016, Ministry of Shipping sanctioned sum of US$ 1.49
million to Gujarat Maritime Board for capacity building and safety training
of workers involved in ship recycling activities under Sagarmala
Note: 1 Data from April December 2016
Source: Ministry of Shipping

34 IT and ITeS For updated information, please visit www.ibef.org

 IT and ITeS

KEY INDUSTRY
ORGANISATIONS
 INDUSTRY ORGANISATIONS
Indian Ports Association (IPA)
Address: 1st floor, South Tower, NBCC Place
Bhishma Pitamah Marg, Lodi Road
New Delhi 110 003
Phone: 91-11-24369061, 24369063, 24368334
Fax: 91-11-24365866
E-mail: ipa@nic.in, ipadel@nda.vsnl.net.in
36 IT and ITeS
Indian Private Ports and Terminals Association
Address: Darabshaw House, Level-1, N.M. Marg,
Ballard Estate, Mumbai 400 001, India
Tel. No: 022-22610599
Fax. No: 022-22621405
Email: secretary@ippta.org.in
For updated information, please visit www.ibef.org
 IT and ITeS

USEFUL
INFORMATION
 NOTES

Major and non-major ports do not have a strict association with traffic volumes. The classification has more of an administrative significance

Cargo traffic includes both loading (export) and unloading (imports) of goods

Containerisation is the increased use of container for transporting non-bulk goods. It leads to increased efficiency (both time and money)

Turnaround time is the total time spent by a ship from entry into port till departure

Twenty Equivalent Units (TEU) is a standard measure of containers which are 20 feet in length and 8 feet in width; the height can vary

Draft is the vertical distance between waterline and the bottom of the ship. It determines the depth of water a ship or boat can safely navigate.
Higher capacity ships will need higher draft, hence ports with higher natural draft will attract bigger ships

Waterfront availability is the length of the water line on the coast where ships can rest and the goods are unloaded. Longer waterfront lengths
reduce waiting time and help raise capacity

Terminals are certain sections of the ports where different types of cargo are unloaded

Single Point Mooring (SPM) is a loading buoy anchored offshore that serves as a mooring point and interconnect for tankers loading or offloading
gas or fluid product

A dry dock is a narrow basin that can be flooded to allow a ship to be floated in, then drained to allow that ship to come to rest on a dry platform.
Dry docks are used for construction, maintenance and repair of ships

38 IT and ITeS For updated information, please visit www.ibef.org

 GLOSSARY

FY: Indian Financial Year (April to March) So FY11 implies April 2010 to March 2011

US$ : US Dollar

FDI: Foreign Direct Investment

IPA: Indian Ports Association

NMDP: National Maritime Development Programme

POL: Petroleum, Oil and Lubricants

SEZ: Special Economic Zone

CAGR: Compounded Annual Growth Rate

ICTT: International Container Transshipment Terminal

TEU: Twenty-Foot Equivalent Unit

MMTPA: Million Metric Tonnes Per Annum

MMT: Million Metric Tonnes

GOI: Government of India

NSICT: Nhava Sheva International Container Terminal, Mumbai

OandM: Operation and Maintenance services

LNG: Liquefied Natural Gas

Wherever applicable, numbers have been rounded off to the nearest whole number

39 IT and ITeS For updated information, please visit www.ibef.org

 EXCHANGE RATES

Exchange Rates (Fiscal Year) Exchange Rates (Calendar Year)

Year INR equivalent of one US$ Year INR equivalent of one US$

200405 44.81 2005 43.98

200506 44.14 2006 45.18

200607 45.14 2007 41.34
200708 40.27
2008 43.62
200809 46.14
2009 48.42
200910 47.42
2010 45.72
201011 45.62
2011 46.85
201112 46.88
2012 53.46
201213 54.31
2013 58.44
201314 60.28

2014-15 61.06 2014 61.03

2015-16 65.46 2015 64.15

2016-17 (E) 67.23 2016 (Expected) 67.22

Source: Reserve bank of India, Average for the year

40 IT and ITeS For updated information, please visit www.ibef.org