India has a coastline of 7,500 km dotted with 13 federal and over 180 non federal ports (of which about fifty are active). Of 13 federal ports, seven ports – Chennai, Ennore, Tuticorin, Visakhapatnam, Paradip, Haldia, and Kolkatta lie on the East coast. The six ports on the West coast include Kochi, Mangalore, Mumbai, JNP (New Mumbai), Mormugao and Kandla. The non federal ports are concentrated in the coastal provinces (called states in India) of Gujarat, Maharashtra, Karnataka, Goa and Kerala on the West coast and in Tamilnadu, Andhra Pradesh, Orissa, and West Bengal on the East Coast.
All federal and non federal ports are governed by Indian Ports Act 1908 which defines inter alia port limits for each port listed therein. Federal ports are managed by the Board of Trustees constituted for each federal port (which are called major ports in Indian parlance) and are governed by Major Port Trusts Act 1963 which deals with the management of major ports.
Non federal ports are governed by the respective state government. In some states, there is a statutory maritime board which administers the ports. In other states, the department of the state government administers the ports.
Business in Indian ports – a perspective
In 2007, federal ports had a capacity of about 510 million tonnes. In general, federal ports operate at high levels of capacity utilisation sometimes going up to 90 per cent. Non federal ports had a capacity of 228 MT and they operate normally at 75 per cent of their capacity. This is not surprising as the demand for port services has been consistently growing at a compounded annual growth rate of ten per cent over the last seven years.
All federal ports are service ports. Dur ing the recently completed 2008 financial year, federal ports handled about 520 MT constituting more than 70 per cent of all India port traffic. POL is the dominant cargo with 30 per cent share followed by iron ore and containers. The federal ports have recorded an impressive growth rate of 12 per cent in aggregate cargo handling during the financial year 2008 and they expect a healthy growth in business in 2009 also.
Non Federal ports are located in the provinces/states of Gujarat, Maharashtra, Karnataka and Goa on the West Coast and in Andhra Pradesh, Tamilnadu, West Bengal and Orissa on the east coast. Gujarat has been in the forefront over the years and it has recorded the maximum traffic of about 147 MT in 2008 constituting about 75 per cent share of non federal port traffic. By and large container traffic is not significant in non federal ports. In terms of cargo mix across Indian ports, due to abundance of coal and iron ore reserves in Easter n India dry bulk cargo is concentrated on the east coast and Visakhapatnam,Krishnapatnam & Gangavaram (new non federal ports), Paradip and Kolkatta are the dominant ports. Container cargo is concentrated on the west coast which handles about 65 per cent of the national traffic. Ports in Maharashtra (JNP), Gujarat (Pipavav, Mundhra), Tamilnadu (Chennai, Tuticorin) and Kerala (Kochi) are dominant container ports. Overall, east coast is
expected to grow faster in future given the lower base and the increasing trend of bulk cargo trade.
Emerging federal port policy
All federal ports have recently prepared business plans and as part of the business plan projects which would entail private investment would be identified. A common framework for private investment in terms of bid management and concession framework has been evolved by the federal government recently for use across all federal ports. In respect of each port project for which private investment is sought, tariffs which could be levied on users would be determined upfront before inviting price proposals. The tariff would be revised based on price index from time to time.
