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Competing for cargo. Gujarat’s minor ports come of age

Private ports such as Mundra, belonging to Adani group, are expected to meet a major share of the targeted cargo growth for non-major ports in Gujarat

Posted on June 12, 2024

With more than 1,000 factories manufacturing everything from bathroom and floor tiles to dinner sets, Morbi in Gujarat is India’s ceramic hub, whose products are in great demand both within the country and overseas. Much of this cargo travels by road to Kandla port, about 134 km away, to be shipped onward to various destinations. It costs about ₹22,000 to transport a single container from Morbi to Kandla. This could be brought down to ₹7,000 if the Navlakhi port, located 45 km from Morbi, is modernised, as envisaged under a master plan drafted by the Gujarat Maritime Board.

“The [Navlakhi] port can easily attract 3-4 TEUs [twenty foot equivalent unit] of container cargo that goes to other ports, including Kandla,” says a GMB official.

Cargo volumes handled by non-major ports (major ports are under the central government and non-major are under states and union terrorities) in Gujarat are expected to quadruple to 2,000 million tonnes per annum (MTPA) by 2040.

“We currently have capacity to handle 500-odd MTPA. We have appointed a consultant to determine the investment needed to bolster the cargo handling capacities of the ports,” says Rajkumar Beniwal, vice-chairman and CEO of the board, which oversees the state’s non-major ports.

To boost export-import traffic, GMB is undertaking cargo flow analysis to pinpoint bottlenecks and identify the infrastructure needed to expand port capacity.

In the past 10 years, traffic at the non-major ports in Gujarat has grown by 5 per cent. During 2023-24, they handled 448 MTPA of cargo, which is nearly 60 per cent of the 772 MTPA cargo handled by all non-major ports in India. Andhra Pradesh followed with 25 per cent, and Maharashtra with 10 per cent.

Private ports

Interestingly, a major share of the targeted cargo growth for non-major ports in Gujarat is expected through private ports, including Adani Port and Special Economic Zone (APSEZ) at Mundra, Pipavav, Dahej and Hazira. “The future growth will mostly be in private ports. The Gujarat government will be facilitating the private ports by adding basic infrastructure,” Beniwal says.

In December 2022 the GMB had projected that non-major ports in Gujarat would achieve 1,000 MTPA cargo traffic by 2040, with APSEZ at Mundra accounting for 400 MT, and that a sizeable 300 MT would be containerised cargo. Pipavav was expected to handle 37 MT by 2040. These projections have since been revised, but there is no word yet on the target for private ports.

Minor vs major impact

Some of the proposed expansion and modernisation plans for non-major ports are expected to hurt the prospects of the lone major port of Gujarat, namely Kandla, which has already lost its position as the country’s top major port to Paradip this year.

During 2023-24, Kandla port handled 131 MT of cargo, down by 4.17 per cent compared to a year ago. The drop in overseas cargo — by nearly 4.8 per cent year-on-year — has been the steepest. On the other hand, coastal cargo has grown by 1.48 per cent.

In sharp contrast, Paradip port in Odisha handled over 145 MT cargo. The 7.4 per cent growth in cargo volumes achieved by Paradip was largely driven by a 11.47 per cent growth in overseas cargo, alongside a 1.98 per cent growth in coastal cargo.

“One of the two major reasons for Paradip overtaking Kandla in cargo volumes this year is infrastructure development. The addition of a mechanised coal handling plant at Paradip boosted its cargo handling capacity and efficiency. Secondly, there has been a marked increase in coastal shipments through Paradip, further contributing to the rise in cargo volumes,” says Pushpank Kaushik, CEO of Jassper Shipping, a Singapore-based shipping company with operations in India.


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