The Government of Andhra Pradesh plans to develop 10 new ports along its 974 km coastline to boost maritime cargo and make the state a major port hub for global trade. Experts discuss various aspects of this plan, including the need for improved connectivity to hinterlands to increase port throughput. While the plan aims to attract investment and improve business, some warn that ports may remain underutilized without sufficient industry growth and that a cautious approach is needed for the ports to succeed.

1. SHIPPING18 CARGOTALK OCTOBER 2015
AP's10newports:Gatewaysforglobalcargo?
The Andhra Pradesh government
has recently started to focus on
augmenting economic growth by
making use of its long coastline to
attract cargo. The government
announced its decision to develop 10
ports in the state, thus turning its 974
km coastline into a major port hub and
a gateway to India for global cargo.
Boosting maritime cargo
The state has an infrastructure
development plan to help achieve a
traffic target of 2.5 Million TEUs by
2015 and 5.5 Million TEUs by 2019.
Also the state is expecting 250
MMTA of bulk cargo by 2019 and 550
MMTA by 2025 and the new ports will
ensure speedy development.
Evacuating the cargo
The state government is giving
priority to the evacuation of
cargo from the existing ports.
G Sambasiva Rao, Managing
Director, Sravan Shipping Services
says, “The government’s basic aim is
ports development and the connec-
tivity of ports via roads and railway
sidings and they are providing a six-
lane connectivity to the existing ports.
After the six-lane connectivity is
established, there will not be any
problem in the evacuation of cargo
for shippers.”
The government is considering
building supporting infrastructure for
the evacuation of cargo from existing
ports by planning to take up some
key port related railway lines and
roads projects.These are expected
to enhance the evacuation capacity.
Revamping the capacity
While the three operational
ports of Krishnapatnam,
Gangavaram and Kakinada Deep
Water Port have plans for the
additional augmentation of more
than 150 MTPA in the near future,
Prabal Basu, Chairman & Managing
Director, Balmer Lawrie & Co opines,
“There is a need for the Andhra
Pradesh Government to have a clear-
cut maritime policy. Further, the
development of linking roads to the
Vizag–Chennai Industrial Corridor is
a must. At present, the container
cargo is finding its way to the Chennai
Port for several historical reasons as
well as due to the high tax structure
in the state of Andhra Pradesh.The
state government needs to address
these issues to incentivise the ports
to revamp their facilities.”
Connectivity with the
hinterland
Discussing the lack of connec-
tivity between Andhra Pradesh and
the hinterland, Basu explains, “At
present, there appear to be major
issues in respect of connectivity to the
hinterland of Chhattisgarh and
Odisha. There is an urgent need to
improve the connectivity with the ports
both via rail and road.Allied infrastruc-
ture like container freight stations
(CFSs) and warehouses will then
develop and throughput volumes
through Andhra Pradesh ports will
consequently increase.”
Need for 10 ports?
The building of the new ports
will be taken up in a planned and
phased manner taking into account
the traffic potential, the existing port
capacity and the evacuation of cargo
from both new and existing ports.The
improving connectivity and the cre-
ation of a proper logistics hub will
make Andhra Pradesh ports the pre-
ferred destination of trade in India.But
Mihir Das, Promoter & Port
Consultant, Portwerk Consultants
warns,“The government’s‘Look East’’
policy must take concrete shape for
the proper message to be relayed to
shipowners that these eastern ports
are ready to do business efficiently.
Only then can they mobilise their fleet
and align marketing policies. Ports
alone cannot succeed.Thus, a cau-
tious approach is necessary.”
Risk of ports turning into
stacking yards
Sceptics suggest that the idea
of building new ports, if implemented
hurriedly, will result in them being
turned into mere stacking yards.
However, Rao does not agree.
He says, “There will be no disadvan-
tages as it will increase
competition amongst the ports,
which will lead to efficiency in
rail infrastructure and further
development of the new ports as they
will be vying with each other to attract
cargo. With new ports, port-based
industries can come up and the
logistics cost can come down. Road
congestion due to evacuation can
also be avoided. ”
The growth of all the ports
will depend on the growth of
industries in Andhra Pradesh, else
these ports will only remain
underutilised. The decision of
building new ports is being looked
upon as a conscious effort to attract
investments and improve the ease of
doing business.
CT BUREAU
Realising the need for port-led development and with the availability of a long coastline, the Government of
Andhra Pradesh has decided to build 10 new ports to boost the maritime sector. Experts discuss the various
facets of this new government policy and whether it will bring about the much-needed development.
G Sambasiva Rao
Managing Director
Sravan Shipping Services
Prabal Basu
Chairman & Managing Director
Balmer Lawrie & Co
Mihir Das
Promoter & Port Consultant
Portwerk Consultants
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