India is strategically located on the world shipping routes, with a coastline of about 7,500 km. It plays a key role in the global maritime trade due to its strategic location. There are about 12 major and 205 non-major ports along the Indian coastline, and their importance in sustaining supply chains can be gauged by the fact that ports handle over 90 per cent of India's international trade by volume and 70 per cent by value is done through maritime transport. India's export-import destinations have been impacted by COVID-19 and cargo movement has been terribly affected. The reduction in economic activity has led to a decrease in demand for crude oil and container traffic across the world. This may mean that the already low capacity utilisation, which stands at about 47 per cent of major Indian ports, may fall further.
Construction World and Infrastructure Today conducted a webinar on ‘Smartening Port Development', which witnessed great success with over 400 attendees tuning in to hear what our esteemed panellists have to say on the impact of COVID on ports in India, technologies making in-roads in port development, and the plan going forward...
The webinar began with presenter Pratap Padode, Editor-in-Chief, Construction World and Infrastructure Today, welcoming the guest panellists to the session. The panellists included industry stalwarts – Sanjay Bhatia, Chairman, Mumbai Port Trust; Avinash Chand Rai, COO, Adani Port & SEZ Mundhra; Ashish Gupta, Managing Director, TM International Logistics (Tata Steel Subsidiary); Sudhir Kanvinde, Executive Director, Indian Ports Association.
Speaking about the Sagarmala programme, Padode added: “Sagarmala is the flagship programme of the Ministry of Shipping to promote port-led development in the country through harnessing India’s 7,500 km long coastline, 14,500 km of potentially navigable waterways and strategic location on key international maritime trade routes. Under Sagarmala, 500 projects have been identified at an estimated infrastructure investment of Rs 3.55 trillion across all the pillars. Out of these, 143 projects (worth Rs 0.88 trillion) have been completed, and 190 projects (worth Rs 2.12 trillion) are already under implementation. The remaining set of 167 projects is under various stages of development and expected completion is expected well within 2035.”
Added Ashish Gupta, Managing Director, TM International Logistics (Tata Steel Subsidiary), “Every day is a new learning. And the biggest learning we had was to keep the sea plants away. We did not face challenges in terms of goods or materials like coal or iron ore, but over a period, in terms of supply chain, cost reduction drive, stock availability. We then realised the number of bottlenecks that exist, in terms of the number of permissions and approvals required. It was humungous to get approvals from the BC and the state governments. Post COVID, there will be a huge difference in the way we look at inventories and stockyards.”
For Sanjay Bhatia, Chairman, Mumbai Port Trust, “In the beginning, there was a huge issue on the transportation side. We then got the passes; and transporters are now working. If you look at the major ports, Kandla is facing a lot of problem in terms of migrant labour. Mumbai is different – we have our people staying at hostels for the last two months. We are working with about 15-20 per cent staff. We are following norms set by the Ministry of Health. I am aware of what is happening on all the other ports. Kandla is affected because of migrant labour. For us at Mumbai we have so much migrant labour that if 300 people go away we are able to get another 300.” He went on to add that although the migrant labour issue has not affected the cargo side so much, it has however affected under construction projects. “The impact is more in places with more COVID cases and where migrant labour is moving. And so, construction projects are suffering.”
Speaking about the cluster groups the shipping ministry is working on, Bhatia added that in the first step the ministry is trying have a national maritime portal for everything to come under one platform. “We have already developed PCS 1 class and are trying to get everybody on board. We are now taking it forward through some software developments. Besides, the ports are also working on the ERP system, through which everything will be electronic.”
But Gupta added that there are a lot of other physical bottlenecks too that exist “because we are typically operating from one place and moving containers. So a lot needs to be done, especially in Eastern India, where mostly steel companies are not very large.”
For Bhatia, once everything is electronic, things will get easier with the ease of business, especially for trade. However, he mentioned that one major effect of the national logistics portal will be that some of the intermediate agents may disappear. “One of the cluster groups is also working on the transhipment side,” He further added that from the private sector, initiatives taken by Adani Group have been phenomenal.
Here, Bhatia added that the ERP systems are also being worked on from home. Further, he added, “We are coming up with the digital bill of lading, so this document – which is like a rupee note – gets transferred from one category to another. We have written to the RBI and the Ministry of Commerce so that the contact part goes away completely.” On investments, he added, “We are working on a new land policy. And the mandate given to me by the minister is that every inch of land on the port should have an industry. In fact, we have already prepared the document and it is being submitted to the ministry.” The ports seem to be doing a decent amount of work trying to get back to more than 80-90 per cent capacities. As Padode thanked the panellists, he ended the session saying, “We all need to look at multiple solutions. There are thousands of solutions once we get down to innovation as we known through this webinar.”
For this and much more on Smartening Port Development, watch the full video.
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