Port development is not just providing new technology to the port but also to manage the traffic of the port. Container traffic in India has seen tremendous growth in the last decade. The traffic of the port has grown by more than 10% CAGR. As Indian GDP is growing and global economy is recovering with tremendous rate it is expected to continue grow in the traffic of container at the ports. If the plans for debottlenecking of logistic infrastructure are implemented in time and the ‘Make in India’ push drives greater exports and manufacturing outsourcing to India then the demand for container traffic can be further accelerate
In order to support this accelerated cargo growth and also, to enable ‘Make in India’ initiatives, it will be important to plan additional capacities and drive greater port productivity. As of now, there are only a few ports in India that have sufficient draft and match global cargo handling efficiencies.
This has resulted in a large percentage (~25%) of containers that originate from India to be trans-shipped in foreign ports such as Colombo, Singapore, Klang etc. This is leading to an economic loss for the country and an economic dependence on foreign ports. Hence, the Ministry of Shipping (Government of India) through VOC Port Trust has asked the consultant to identify a suitable site and assess feasibility of developing a new container trans-shipment port on the Southern coast of India near Colachel.
Colachel is a strategic location given its proximity to the international East-West shipping route. This route accounts for a major share of the total global container traffic flows and the mainline vessels use this route for transporting cargo between US, Europe and Asia. A significant share of India’s current container cargo also moves through this route. The following figure shows proximity of Colachel to the east-west mainline shipping route. Colachel has a natural deep draft which makes it viable for servicing large sized vessels, which is an important factor in attracting shipping lines. Global vessel sizes have significantly increased in the last decade and most main liner vessels have capacities of 10,000 TEUs and above, with the largest vessel reaching a capacity of 18,000 TEUs.
India has not been able to create an attractive trans-shipment port alternative that can match the competing international ports on location, draft and overall cost economics. This has been the key reason for losing out on this opportunity to international ports. To make Indian ports more effective it is needed to expend them for handling increase in the traffic of cargo.