The Indian port sector offers new growth opportunities with numerous projects being undertaken across various categories such as port modernisation, cruise tourism, multimodal logistics parks (MMLPs) and coastal infrastructure. The Sagarmala initiative has been a successful step towards improving the efficiency of Indian ports. It has enabled them to handle large volumes by making them more efficient and reducing the turnaround time of containers. The Maritime India Vision 2030 will give a further fillip to the sector. As part of the vision, major ports need to undertake a capacity addition of 423 million tonnes per annum (mtpa) at an investment of over Rs 334 billion. Further, the development of hydrogen-fuelled electric vessels is being considered as a gateway for the country to tap vast opportunities lying in the coastal and inland vessels segments, both nationally and internationally.
Cruise shipping
The Indian cruise market, which is driven by increasing demand and disposable income, has the potential to grow tenfold over the next decade. The country is looking forward to increasing cruise passenger traffic from 0.4 million at present to 4 million over the next few years. In order to augment the cruise tourism industry in the country, the government has taken several initiatives. These are infrastructure upgradation, rationalisation of port fees, removal of ousting charges, granting of priority berthing to cruise ships, provision of e-visa facilities, etc. Also, a dedicated task force has been formed on cruise tourism jointly by the Ministry of Tourism and the Ministry of Ports, Shipping and Waterways (MoPSW).
Completed projects
The country’s first full-fledged international cruise terminal, Sagarika, was inaugurated in 2021. In a notable development, the world’s longest river cruise was flagged off from Varanasi on January 13, 2023. The cruise ship, MV Ganga Vilas, will cover 3,200 km over 51 days, crossing 27 river systems and several states. The voyage is packed with visits to 50 tourist spots, including World Heritage spots, national parks, river ghats, and major cities such as Patna, Kolkata, Guwahati and Dhaka.
Upcoming projects
The government is planning to start cruise services on the Yamuna river. An order has been placed by the central government with Cochin Shipyard for two cruises, which will be handed over to the Parishad. The Andhra Pradesh Tourism Development Corporation is also planning to start a special tourist cruise ship on the beaches. Further, streamer and mini cruise services will start in Prayagraj for the Maha Kumbh in 2025. The survey has been done by the Inland Waterways Authority of India (IWAI). The service will be operational from two points, one from the boat club to Sangam and the second from Lavayan Kala (Naini-side) on the Ganga river to Sangam. Further, a two-floor jetty would be constructed at the boat club.
Meanwhile, in October 2022 the MoPSW laid the foundation stone for the development of international and domestic cruise terminals at Mormugao port with an investment of Rs 1.23 billion. Upgradation and modernisation are being carried out at seven major ports in the country including the flagship New International Cruise terminal coming up in Mumbai at a total cost of about Rs 4.95 billion. The iconic sea cruise terminal coming up at the BPX-Indira Dock is expected to be commissioned by mid-2024. A similar infrastructure upgradation is taking place in Goa, New Mangalore, Kochi, Chennai, Visakhapatnam and Kolkata.
MMLPs
MMPLs are another emerging opportunity area that will play a crucial role in reducing logistics costs to 10 per cent of GDP. India’s logistics cost as a percentage of GDP is very high at 16 per cent while in the US and European countries it is around 8 per cent. Under the PM Gati Shakti National Master Plan, the Ministry of Road Transport and Highways (MoRTH) is building 35 MMLPs, of which 15 will be prioritised in the next three years.
Agreements signed
In September 2022, the Jawaharlal Nehru Port Authority (JNPA) and National Highways Logistics Management Limited (NHLML) signed an MoU for the development of an MMLP at Jalna in Maharashtra. The Jalna MMLP will serve as the functional dry port of the region. In August 2022, a tripartite agreement was signed for the swift development of a modern MMLP under the Bharatmala Pariyojana across the country. The agreement was signed by NHLML, IWAI and Rail Vikas Nigam Limited. The MMLP, developed on the hub- and -spoke model, will integrate multiple modes of freight transport through highways, railways and inland waterways. The MMLP project is poised to develop a state-of-the-art large-scale warehousing facility for different types of commodities. It will be a one-stop solution for all services related to cargo movement. Further, MMLPs will focus on the technology-driven implementation of a state-of-the-art freight management system.
Project developments
The construction work at India’s first MMLP in Assam’s Jogighopa is almost complete. Some minor works are left, which are expected to be finished in the coming two to three months. The project is expected to generate revenue worth around Rs 1 billion in the first three years from the start of operation. The MoRTH awarded the contract of setting up an MMLP near Chennai to Reliance Industries Limited in November 2022. The MMLP is strategically located at around 52 km from Chennai port, 80 km from Ennore port and 87 km from Kattupalli airport. It will be a focal point of logistics in the southern region.
Towards sustainability
The Government of India is committed to reducing emissions from the shipping sector and promoting the development of net zero and low-emission solutions. In response to this, all major ports are to be made fully self-sustainable on electricity by 2030. All the energy requirements of ports are to be met through renewable energy sources. Government initiatives also include green warehousing, utilising green/natural solutions such as natural light or energy efficiency lighting, automated and compact storage systems, and rooftop solar.
Key measures
JNPA has taken several green initiatives with a view to reducing the carbon footprint of the sector. These include the use of solar power supply, e-vehicles, shore power supply, etc. The authority intends to use 60 per cent of renewable energy under the Maritime India Vision 2030. It is developing an integrated common rail yard facility inside the port to facilitate dedicated freight corridor rake handling and has prepared an action plan covering all activities of the port including cargo handling, storage, evacuation and many other activities related to environmental protection.
Besides, in July 2022, Garden Reach Shipbuilders and Engineers Limited and a leading warship building company in India signed a contract with the West Bengal government for the design and construction of the next-generation electric ferry that will pave the way for reducing carbon emissions in the water transport sector in the state.
The MoPSW has decided to develop and build the first indigenous hydrogen-fuelled electric vessels at Cochin Shipyard Limited (CSL). CSL has partnered with KPIT Technologies Limited and Indian developers in the areas of hydrogen fuel cell, power train and Indian Register of Shipping for developing rules and regulations for such vessels. The hydrogen fuel cell vessel, based on low-temperature proton exchange membrane technology and called a fuel cell electric vessel, is expected to cost around Rs 175 million, of which 75 per cent will be funded by the Government of India.
Further, the MoPSW launched a solar-electric hybrid high speed ferry and a floating jetty project at Panaji in October 2022. The three jetties commissioned were built at a project cost of Rs 960 million. The jetties are solid concrete structures that float on water, are easy to install and have a minimal environmental impact. The solar-electric hybrid high speed ferry project is being funded by the Goa government at a cost of over Rs 390 million and with a carrying capacity of 60 passengers. Besides, the foundation stone was laid for multiple development projects at Mormugao port, which include the development of roll on-roll off (ro-ro), passenger ro-ro and other allied facilities.
The way ahead
A holistic approach, which goes beyond the development of port infrastructure to handle vessels and traffic, is required. This will include the introduction of chopper services, coastal tourism facilities, guided tours, resort development, water sports, voyages, backwater development, recreational/wellness hubs, etc. Also, there is a need to ensure better utilisation of the existing provisions and institutions to fully tap the potential of the Indian port sector.
Sidra Siddiquie