Traffic Trends: Indian ports witness a steady rise in cargo movement

Cargo traffic at Indian ports has been st­e­adily increasing, with significant chan­ges in the commodity composition at Indian ports over the past few years, including a rise in coal and petroleum products. Several steps have been taken to cater to the growing traffic volumes at Indian ports. Moreover, the launch of the Sagarmala programme has stimulated port development, modernisation and capacity creation.

The major as well as non-major ports un­der the Ministry of Ports, Shipping and Water­ways have registered an impressive growth in traffic movement. The total cargo volume in 2021-22 stood at 1,318.92 million tonnes (mt), a growth of more than 5.5 per cent year on year. Further, the Inland Waterways Authority of India transported 108.79 mt of cargo through national waterways, registering an impressive 30 per cent increase on a year-on-year basis.

The cargo handling capacity of major ports has increased from 965.36 million tonnes per an­num (mtpa) as of 31 March 31, 2016 to 1,534.91 mtpa as of March 31, 2022. Simi­la­rly, the cargo handling capacity of non-major po­r­ts has increased from 737.75 mtpa as of March 31, 2016 to 1,007.41 mtpa as of March 31, 2022. As per a study conducted under the Sa­garmala programme, cargo traffic at Indian ports is estimated to reach 2,500 mtpa by 2025. Meanwhile, in order to cater to the growing traffic, a roadmap has been prepared to increase the capacity at Indian ports to over 3,300 mtpa by 2025.

Major ports

Traffic at major ports has grown at a compound annual growth rate (CAGR) of 2.12 per cent during the period from 2016-17 to 2021-22. During April-February 2022-23, Indian major ports handled 711.55 mt of traffic compared to 650.14 mt in the corresponding period of 2021-22, registering a growth of 9.4 per cent. The overseas cargo handled at major ports in­creased by 10.2 per cent from 496.45 mt during April 2021 to February 2022, to 546.88 mt during April 2022 to February 2023. Besides, coastal cargo handled at major ports increased by 7.1 per cent from 153.7 mt during April 2021 to February 2022, to 164.67 mt during April 2022 to February 2023. The increase in cargo traffic is a result of in­creased shipments of coal and petroleum and other crude products. The increased dem­a­nd for coal is being driven by a sharp increase in electricity consu­m­ption, supported by heatwaves. Besides, container cargo handled by major ports increased to 10.37 million twenty-foot equivalent uni­ts during April-February 2023, an increase of 1.5 per cent compared to the corresponding period last year. This is a result of increasing global demand for containers.

Among major ports, Deendayal port handled the maximum cargo of 127.22 mt with a share of 17.9 per cent during April 2022 to February 2023, followed by Paradip port (17.1 per cent), Jawaharlal Nehru port (10.7 per ce­nt), Visakha­patnam port (9.4 per cent), Mum­bai port (8.1 per cent), Chennai Port (6.3 per cent), Syama Pra­sad Mookerjee Port Hal­dia (6.2 per cent), Kamarajar Port (5.6 per cent), New Man­galore port (5.2 per cent), V. O. Chi­dambar­anar port (4.8 per cent), Cochin Port (4.4 per cent), Mormugao port (2.2 per cent) and SMP, Kolkata (2.1 per cent).

SMP, Kolkata handled a record cargo of 54.84 mt from April 2022 to February 2023, registering a 13.88 per cent growth over the corresponding period last year. The major commodities that contributed to the growth of traffic were liquid petroleum gas, coal and containers. Meanwhile, Jawaharlal Nehru Port handled a record cargo of 75.94 mt from April 2022 to February 2023, registering a 9.94 per cent gro­wth over the corresponding period last year, with containers contributing to its growth.

With regard to commodities, during April 2022-February 2023, containers contributed the maximum cargo of 154.71 mt with a share of 21.7 per cent followed by petroleum oil and lubricants (POL)-crude (20.7 per cent), thermal coal (13.7 per cent), others commodities (9.9 per cent), POL products (7.3 per cent), iron ore/pellets (5.7 per cent), other coal (5.3 per cent), coking coal (5 per cent), and liquefied petroleum gas/liquefied natural gas (2.1 per cent), among others.

Initiatives for enhancing cargo

Several initiatives are being taken by Indian ports to improve cargo handling efficiency and remove supply chain bottlenecks in order to handle more capacity. For instance, SMP has been working to advance the timelines of projects worth about Rs 17 billion for augmenting capacity, moder­nising infrastructure, monetising assets and digitalising operations, and creating infrastructure over the next two years. The port aims to increase its cargo handling ca­pacity to 110 mt by 2030. Besides, cargo handling capacity is being expanded at Kamarajar Port with the construction of a roll-on/roll-off-cum-general cargo berth (GCB-II) at an investment of Rs 1.61 billion. Further, Jawaharlal Ne­h­ru Port is planning to increase its cargo handling capacity and add more railway lines to the port. The port is also looking at avenues to modernise and improve its efficiency alongside reducing dwell time.

Non-major ports

For the past few years, maritime states (non-major ports) have been leading the growth of the sector. Traffic handled at non-major ports in­creased at a CAGR of 4.29 per cent from 2016-17 to 2021-22. The highest increase in traffic handled was registered during 2018-19 with a year-on year increase of over 10 per cent (over 2017-18). During 2021-22, the share of non-major ports in the overall traffic handled at Indian ports stood at 45.39 per cent, due to a significant shift in traffic from major ports to non-major ports.

The cargo traffic handled at non-major ports from April 2022 to February 2023 stood at 589.03 mt, an increase of 9.1 per cent over the 539.66 mt handled from April 2021 to February 2022. The overseas cargo traffic handled at non-major ports during April 2022-February 2023 increased to 459.68 mt from 482.19 mt in the corresponding period in the previous year, registering an increase of 4.9 per cent. Further, the coastal cargo traffic handled at non-major ports during April 2022-February 2023 increased significantly by 33.6 per cent to 106.85 mt from 79.98 mt during the April 2021-February 2022 period.

In terms of cargo handled from April 2022 to February 2023, among the state maritime boards/directorates, the Gujarat Maritime Bo­ard handled the maximum cargo of 376.97 mt with a share of 64 per cent, followed by the An­dhra Pradesh Maritime Board (15.7 per cent); Maharashtra Maritime Board (10.5 per cent); Directorate of Ports, Odisha (6 per cent); Tamil Nadu Maritime Board (1.8 per cent); Direc­torate of Ports, Puducherry (1.6 per cent) and others (0.5 per cent), including the non-major ports of the Andaman & Nicobar Islands, Goa, Kerala and Karnataka.

Adani Ports and Special Economic Zone (APSEZ) achieved a milestone of handling 300 million metric tonnes (mmt) of cargo on Feb­ruary 23, 2023, surpassing its own re­cord of 354 days set last year by accomplishing this feat in 329 days. The company’s flagship port, Mundra continues to be the largest port in the nation in terms of volume handled. Mun­dra port witnessed an 18 per cent increase in roll-on/roll-off exports, mainly due to its long-term customer Maruti Suzuki India Limited. In February 2008, APSEZ signed a port services agreement with Maruti Suzuki India for handling car exports. Further, Mundra port delivered 1,501 fertiliser rakes in the current fiscal year, with a total cargo despatch of 4.8 mmt. Mundra port is also planning to add four more railway lines to the port in order to improve the traffic movement from the port.

Net, net

The increasing traffic at Indian major and non-major ports indicates a positive long-term outlook for the port sector, supported by gove­rnment policy interventions, private capital infusion, and holistic and inclusive development focused on efficiency, job creation and innovation. However, to further this progress, there is a need to establish adequate evacua­ti­on infrastructure and dedicated berths for handling coal and iron ore, as well as en­han­ce storage capacities.