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I expect lot of infrastructure projects to come up providing better connectivity to east coast ports in the next few years: Capt K.P.Rajagopal

Q) The ports in the east coast from Visakhapatnam to Tuticorin are working fifty per cent of their capacity while JNPT and Mundra ports in the west coast are overworked during the last few years. Representatives of trade and Industry complain of lack of adequate railway infrastructure between Central India (emerging as manufacturing base of the country) and the east coast ports. They also talk of lack of competitive rail freight tariff to end this imbalance. What is your take on the issue?

ANS) It is a fact that the railway infrastructure to east coast ports do not match with the ones created for the ports in the west coast. The dedicated freight corridor linking Mumbai with Delhi expected to be commissioned in the next two years is going to give further fillip to the ports in the west coast

Unlike the ports in the west coast where bulk of the cargo is containerized, Sizeable portion of the cargo handled at the east coast ports are bulk, which are susceptible to lot of changes by the governmental policies. There is also lot of concentration of liner trade in JNPT,Mundra, Pipava and Hazira ports in the west coast.

I expect lot of infrastructure projects to come up providing better connectivity to east coast ports in the next few years. The next five years will be trying time for the ports in the east coast. Liner services are expected to pick up only then.

Q) Is the lack of adequate railway infrastructure between Central India and east coast ports or lower freight cost offered by shipping lines to ports in the west coast responsible for the imbalance? What needs to be done to correct the situation?

ANS) The government should implement the promise given in the parliament a few years ago of building a dedicated rail freight corridor between Delhi and Chennai and Mumbai and Chennai.

Lot of volumes of inter Asia cargo basically from China can be unloaded in east coast ports like Chennai Krishnapatnam and Visakhapatnam. The cargo offloaded here can reach National capital region and central India at least five days earlier than going via JNPT or Mundra. Cargo from south East Asia, China require at least five days additional sailing time if it had to reach JNPT than if they are handled at Chennai port.

The dedicated corridor between Chennai and Delhi linking Nagpur will go a long way to improve the railway infrastructure for east coast ports.

Q) Do you think cargo volumes available in east coast ports warrant a dedicated corridor between Chennai and Delhi and Chennai and Mumbai?

ANS The ports in the country are handling one billion tons of cargo. In the next five years the growth is expected to be phenomenal. Additional capacity will be required to handle the increased volume of trade. The government is building five ports to meet the future requirement. Along with the ports rail connectivity is also a crucial factor for movement of goods. It is a chicken and egg story and the government should not drag its feet on providing adequate rail connectivity to east coast ports.

Post GST the inventory model of the industry is also likely to change drastically. The change will have implications for the logistics sector as well. The model will be stock and sell and ware houses will be constructed in various parts of the country. The E commerce will ensure that those who have stocks at various cities alone can survive in business.  Unless you have stocks on hand, you will lose out on business.

This would mean increased movement of cargo between various cities and the railways business is bound to increase. Railways will no longer insist on return cargo for running freight services.

Q) Cargo from China and far eastern countries meant for central Indian cities like Hyderabad and Nagpur are currently handled at JNPT despite the freight advantage in East Indian ports. Imported Toor dhal from Myanmar and bound to Nagpur for processing is also handled at west coast ports. A coastal shipping company which organized a service to Chennai had to abandon the service since CONCOR failed to provide service from Chennai to Nagpur. Central Indian cities in eastern Maharashtra are emerging as manufacturing centers and are close to east coast ports. How do you improve the railway connectivity?

Cargo from China and far eastern countries like Japan and South Korea and bound for National capital region and Nagpur will reach their destination at least one week earlier if they are handled in ports like Chennai and Krishnapatnam than via JNPT as is being done now. Freight costs will be less by at least fifteen per cent.

East coast ports have distinct advantage in handling cargo from China and Far East. What geography has provided us we are unable to take advantage because of lack of adequate rail-connectivity?

Q) Krishnapatnam port has done well in transshipment business for the past several months. Chennai port is also entering transshipment business in a big way soon. Singapore and Colombo ports have been cornering the transshipment business of east coast port for several decades. What are the measures these ports should adopt to attract more transshipment business?

ANS)  Transhipment business for the east coast ports is a sound business proposition. Besides the east coast ports Krishnapatnam and Chennai could attract cargo from Bangladesh and Myanmar. Both Bangladesh and Myanmar are closer to east coast ports compared to Singapore or Colombo. I see a lot of scope for transshipment business and they should work on it.

Singapore port has advantages to handling cargo form countries like Indonesia, Philiiphines.

Q) Will the transshipment terminals coming up at Vizhinjam and the one proposed near Colachel help to reduce the dependence on Colombo and Singapore?

ANS) After a ten year depression the shipping industry is turning around. I expect a lot of developments in India in the next five years.  Seventy five per cent of the construction work at Vizhinjam port is completed and it is a question of time before the port is commissioned. With the agitations by fishermen intensifying forcing the authorities to shift the location of the port thrice in the last two years, it will take at least five years till the foundation stone is laid for the Colachel port, The government has to improve infrastructure and rail connectivity to both the proposed ports.

Vallarpadam terminal at Cochin port is bound to stay notwithstanding the criticism about its poor performance. The port is going to stay but the growth will be slow.

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