Sector briefing

Ports Opportunities in India

Why India?
India has a coast line of over 7000 Kms with a maritime tradition dating back several centuries. It has twelve major ports under the jurisdiction of the central government and one hundred and eighty seven non-major ports which are controlled by the respective state governments. The port privatisation policy announced by the Government of India in October 1996 offers a number of opportunities for British companies engaged in port consultancy, construction, management and turnkey contracts. The general layout of the facilities in the older ports is outdated and the facilities are not suitable for modern cargo handling. There is ample scope to increase the capacity of existing facilities through modernisation and improvements in productivity and construction of new berths. The value of such projects would range from 2million to 700 million. Find general information on Indian market conditions on UKTIs website. The Doing Business Guide for India gives an overview of Indias economy, business culture, potential opportunities and an introduction to other relevant issue

UK Trade & Investment Sector briefing: Ports opportunities in India

Opportunities
An expert group set up by the Government of India (GoI) has forecasted overall port traffic to reach about 900 million MT by 2011/12 from 500m MT in 2006/07. For creation of additional port capacity and the back up infrastructure to meet traffic projection targets, the Indian Government has announced a major Initiative Rs 550 billion (7 bn) National Maritime Development Project (NMDP) on the lines of highly successful National Highway Development Programme (NHDP). The NMDP project, to be completed in the next 6 years, envisages setting up of new ports, modernisation of the existing ones and connecting all ports with national highways. The impact of the Government policy on privatisation of ports and allowing 100% FDI has been immediate. The sector has seen significant levels of FDI from several international port developers / operators. In 1999, the government awarded the first ever concession to P&O Ports on a 30 year BuildOperate-Transfer (BOT) basis for operation of the Nhava Sheva International Container Terminal at JNPT near Mumbai. P&O Ports (now DP World) is the largest international investor in ports in India. The other major international companies operating in the Indian ports sector include PSA (formerly port of Singapore Authority), Dragdos SPL of Spain, Port of Zebrugee Belgium, Scot Wilson Kirkpatrick India Pvt. Ltd. and Dredging International(Belgium).In addition major infrastructure companies from India such as L&T, GVK, Gammon, Hindustan Infrastructure, IL&FS, Reliance, Adani and Marg are operating in the Ports sector. There are many UK companies operating successfully in this market in the areas of port consultancy, port management, material handling, port construction etc. The global financial crisis has impacted most corporates and investor sentiment. The impact however has been minimal on the Indian economy. The government is reviewing projects and programmes in the area of infrastructure development, including both public sector projects and PPP projects to ensure that their implementation is expedited and they do not suffer from the constraints of funds.

Current and future opportunities at various major ports are as follows: Creation of exclusive berth for export of cars at Mumbai port A standalone berth for container handling at JNPT (Jawarhlal Nehru Port Trust) at a cost of Rs 6 Billion ( 85 million). The port has re invited RFQs and 8 parties have submitted their proposals. Additional Mega container Terminal at JNPT for a capacity of 4.4 million TEU. Bids are yet to be called for the project. Integrated Port facilities on PPP model at Vadinar, a satellite port of Kandla Rollon/Roll off terminal at Chennai Port for export of cars and Multi level car parking at Chennai Port to be built on PPP basis. The Chennai port has invited tenders for preparation of feasibility report. The Chennai port plans to construct a Mega container terminal with a capacity of 4 million TEUs on a BOT basis. The project is awaiting clearance from Public Private Partnership Approval Committee (PPPAC) Multi user Liquid Terminal at the Cochin Port SEZ on a PPP basis. The feasibility report has been finalised and Cochin Port will shortly invite global bids. Container terminal at Ennore on a PPP format. Although the project has moved from RFQ to RFP stage, some legal issues have cropped up and will move forward only with the resolution of legal issues. Government of India has approved a dedicated container terminal at Kolkata port. Bids are likely to be invited shortly. Deep sea port at Saugar Island at a cost of 950 million off the West Bengal coast. The project is in EOI stage. Part Privatisation of operations both at Kolkatta and Paradip have been

UK Trade & Investment Sector briefing: Ports opportunities in India

approved and measures are afoot to implement them. Minor ports

Sdn Bhd of Malaysia. The total cost of development is estimated to be Rs 100 billion (1.5 billion) Maharastra

Gujarat Gujarat maritime board is developing nine ports at Bedi, Modhva, Mithivirdi, Simar, Vansi Borsi, Dahej, Sutrapada, Khambat and Mahuva. All these have been awarded to private companies on a 30 year lease. Kerala The Kerala Government is on the look out for consultants for development of three ports namely: Alappuzha, Beypore and Azhikkal. The ports will be developed on PPP model. The consultants are required for preparing detailed Project Reports (DPRs), identifying the Private partners and assisting government in achieving technical and financial closures Orissa The state government of Orissa has awarded development of Dhamra port to a JV Dhamra Port Company Limited (DPCL). The first phase of the project is under construction. Andhra Pradesh Phase I of the development of Krishnapatnam Port is complete. Under Phase II, the Krishnapatinam company is expected to add 40mt capacity. The Government has agreed to handover the Machilipatnam Port to Navayuga Engineering Company Ltd. of Hyderabad (promoters of Krishnapatnam Port) The Government has also identified Bhavanapadu, Kalingapatnam and Narsapur ports for development under PPP model. Karnataka Karnataka is developing an all weather port at Karwar at a cost of Rs 100 Billion (1.5 billion).The successful bidder will soon be announced Pondicherry The Karikkal port near Pondicherry is being developed by Marg Constructions Ltd. Marg has formed a SPV in the name of Karrikal Port Pvt. Ltd. which has tied up with Pembinaan Redzai Maharastra state Rewas(Reliance) and private developers is Reddi developing port through

Characteristics of the market 75% of the cargo volumes in India are handled by major ports. As per ministry of Shipping statistics, the 12 major ports in India handle a total of 561Mmt of traffic in 2009-10 an increase of nearly 6% over the previous year.

Port Mumbai JNPT Visakhapatnam Ennore Paradip Kolkata Dock (incl. Haldia) Kandla Chennai Kochi Mormugao Tuticorin New Mangalore Total

2010 (mMT) 54.54 60.74 65.50 10.70 57.01 46.29 79.52 61.05 17.42 48.84 23.78 35.52 560.91

The projections for the Eleventh Plan period (2007-2012) released by the Government of India gives huge impetus to the investment in Ports sector. Total investment is projected at Rs. 870 billion (11 bn) with 63% being invested in major ports and balance in minor / non-major ports. Also it is estimated that 34% of investment in major ports and 14% of investments in minor / non-major ports will come from public sector while private sector will have to invest rest. If you have any questions on the opportunities above, contact the UKTI Ports contacts named in this report. Business opportunities aimed specifically at UK companies are added daily to UKTIs website. These leads are sourced by our staff overseas in British Embassies, High Commissions and Consulates, across all sectors and in over 100 markets.

UK Trade & Investment Sector briefing: Ports opportunities in India

Jayalakshmi Jayaraman Senior Trade & Investment Adviser Major events and activities British Deputy High Commission, Chennai Tel: (0091 44) 4219 2151 For details of future port related events in India Email: Jayalakshmi.Jayaraman@fco.gov.uk or in the UK please contact UKTIs Ports Sector www.ukti.gov.uk Group Email: Jason.Castelino@ukti.gsi.gov.uk Sujith Thomas Trade & Investment Adviser British Deputy High Commission, Chennai Find full details of all India ports events Tel: (0091 44) 4219 2151 on the UKTI website. New export events are Email: Sujith.Thomas@fco.gov.uk added daily to the site and you can register to www.ukti.gov.uk be alerted to them on a daily, weekly or monthly basis UKTIs Tradeshow Access Programme (TAP) provides grant support for eligible Small & Medium Sized Enterprises (SME's) to attend trade shows overseas. Find out more about UKTI support for attendance at overseas events

You can be alerted to India/ports opportunities on a regular basis by registering on the UKTI website. More on UKTIs business opportunities service

UKTI contacts

UK Trade & Investment Sector briefing: Ports opportunities in India

Next steps How UKTI can help

British companies wishing to develop their business in the Indian market are advised to undertake as much market research and planning as possible in the UK. UKTIs team in India, with its wide local knowledge and experience, can provide a range of services to British-based companies wishing to grow their business in the Indian market. This can include: Provision of market information Validated lists of agents/distributors Key market players or potential customers in the Indian market Establishment of interest of such contacts in working with you Arranging appointments Organise seminars or other events for you to meet contacts and promote your company in the Indian market This work is available via our Overseas Market a chargeable Introduction Service (OMIS) service which assists British-based companies wishing to enter or expand their business in overseas markets. To find out more about commissioning this work, or accessing other UKTI services and specialist advice, please visit the UKTI website to find contact details for your local UKTI office.

Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2010 by UK Trade & Investment. Crown Copyright

UK Trade & Investment Sector briefing: Ports opportunities in India