Export-hungry India to Spend Billions on Port Upgrade

Jan. 14, 2011
Ports need to become more efficient 'for the country to compete globally and become a manufacturing hub'

India is aiming to invest $100 billion to develop new ports and ships under a major new government plan to unleash the country's exporting potential.

"We want to bring our ports at a par with the best international ports in terms of performance and capacity," Indian Shipping Minister G. K. Vasan said. He said the ministry intends to triple the capacity of India's ports to enable them to handle 3.2 billion tons a year.

India's annual maritime trade is expected to hit 2.5 billion tons by 2020.

Improving creaking ports is seen by economists as key to making India a global export hub for manufactured goods, which would generate mass employment and raise economic growth.

India has already emerged as a world center of small-car production, but relatively few are exported because of transport and capacity problems that bedevil its ports.

Chetan Bijesure, a senior official at the Federation of Indian Chambers of Commerce and Industry (FICCI), said that Indian ports had to become more efficient "for the country to compete globally and become a manufacturing hub."

Under the new plan a total 4.52 trillion rupees (US$100 billion) of investment is proposed through private and public participation, with 2.87 trillion rupees earmarked for ports and 1.65 trillion for ships.

The investments will cover the development of two new major ports on the country's east and west coasts -- at unspecified locations -- while four existing ports in Mumbai, Kochi, Chennai and Visakhapatnam will be expanded.

N.N. Kumar, deputy chairman of Mumbai's Jawaharlal Nehru Port Trust (JNPT) -- one of the four earmarked for expansion -- said the investments were urgently needed. "Congested ports make it nearly impossible to export goods. At JNPT we need to carry out dredging operations so we can handle bigger ships. And we need more modern equipment so we can load and unload ships faster," Kumar said.

He predicted that the investment could raise JNPT's world ranking in terms of the volume of goods handled from 20th to 10th by 2015.

As part of the plan, the ministry also aims to raise India's share of the global shipbuilding industry from 1%-5% by 2020.

It also seeks to increase the percentage of Indian seafarers in the global shipping industry from between 6%-7% currently to nine per cent by 2015.

Copyright Agence France-Presse, 2011

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