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India need to boost cargo capacity to remain competitive globally: ASSOCHAM

14 Dec 2017 Evaluate

Highlighting the importance of port development, the industry chamber Associated Chambers of Commerce and Industry of India (ASSOCHAM) in its latest comprehensive study on ports has stated that India must boost its ports fast to make them globally competitive as the gap with China is widening rapidly. India’s total containerised cargo capacity of 8.75 million TEUs (twenty-foot equivalent units) at all its 12 major ports is less than total containerised cargo capacity of 36.5 million TEUs at China’s single port of Shanghai, making it imperative for the country to do a fast catching up.

According to the study titled ‘Indian ports sector: Challenges of scale and efficient operations’, China has four ports which handle more than 20 million TEUs. Even on the parameter of overall cargo, both with or without containerisation, India has a fragmented capacity at different ports. Noting that for India to remain competitive globally, the study said investment in port capacity is a must. It suggested that it would be appropriate to augment capacity of existing ports to create ports with large capacity of 100 million tonnes rather than building new ports and spreading resources thinly. It also stressed the need to revisit the Major Ports Trusts Act, 1963 with a view to modernise the institutional structure of major ports and to secure greater operational freedom for ports, in tune with present day requirements.

The study pointed out that handling of containerised cargo is a key indicator of a country’s integration with global supply chain for value-added manufactured goods. The industry chamber secretary general, D.S. Rawat has said that though Indian ports met rapidly expanding traffic, handling more than a billion tonne of cargo in 2016-17, the capacity is expected to go up to 2.5 billion tonnes by 2025. He added that the freight mainly comprises petrol, oil, and lubricant, coal, iron ore and other commodities. Referring to Odisha, Rawat said setting up 13 non-major ports along its 480 km-long coastline will further boost the prospect of port infrastructure, bring in investment, create thousands of jobs and also add to the revenues of the state exchequer.

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