Indian private port growth outpaces major government rivals

Despite general moderating signs due to lacklustre demand conditions, the non-major ports in India  better known as minor ports – continue to grow faster than federal government-owned major ports.

In the first 10 months of fiscal year 201920 (AprilJanuary), cargo tonnage at non-major ports increased 4.8% year-over-year (y/y), outpacing the 1.1% growth recorded by major ports in the same period. By volume, total cargo handling at non-major ports hit 499.72 million tonnes, up from 476.87 million tonnes in the year-ago period, whereas major ports saw traffic edge up to 585.6 million tonnes from 579.1 million tonnes.

Cargo mainstays for minor ports were coal, petroleum products, and containerized shipments. Of 499.72 million tonnes, export-import loadings represented 423.92 million tonnes, up 6.2% y/y, with coastal movements down 2.3% to 75.8 million tons.

As a result, non-major ports captured 46% of Indian seaborne trade for the AprilJanuary period, thereby rapidly closing their combined market share gap with major ports.

Gujarat state, which hosts the country’s busiest non-government ports of Mundra and Pipavav, accounted for as much as 68.3% of total tonnage, followed by Andhra Pradesh, at 16.9%; Maharashtra, at 6.8%; Odisha (Orissa), at 5.7%; Puduchery, at 1.7%; the Andaman & Nicobar Islands, at 0.3%; and Karnataka and Tamil Nadu, at 0.2%. 

State-wise AprilJanuary volumes were as follows: Gujarat, at 341.2 million tonnes, up 4.1% from 327.8 million tonnes; Andhra Pradesh, at 84.3 million tonnes, down 2.1% from 86.1 million tonnes; Maharashtra, at 33.7 million tonnes, down 6.5% from 36 million tonnes; and Odisha, at 28.5 million tonnes, up 64.6% from 17.3 million tonnes, according to new data.  

India has 12 major ports and about 200 minor ports dotting its 4,600 miles (7,402 km) of coastline. Unlike terminals at major ports, privately built minor ports have the freedom to set their tariffs and are also free from other typical bureaucratic barriers.

Much of the minor ports’ growth comes from Adani Group-owned cargo terminals at Dahej, Dhamra, Hazira, Kandla, Kattupalli, Mormugao, Mundra, and Visakhapatnam — all together they command roughly 25% of the country’s total port capacity. Adani, in January this year, announced the acquisition of Krishnapatnam Port (recently renamed Navayuga), a key minor player on the east coast, about 112 miles north of Chennai, further cementing its footprint in the country. 

Also in January, non-major ports together handled 52.52 million tonnes of cargo, a gain of 4.3% over the same month last year.

Looking ahead, the opening of Indian coastal markets to foreign-flagged vessels by lifting previous cabotage restrictions is likely to be another growth catalyst for non-major ports, given their structural advantages, according to industry observers.

Source: Dredging and Port Construction