Growth in the Cargo Traffic

Notwithstanding this, all major ports handle 3/4^th of the total traffic. Among them, Vishkhapatanam, Kandla, Mumbai, Chennai and Kolakata (including Haldia) ports together have a share of 60 per cent or more in the total traffic handled during 1996-97 to 2007-08. The contribution of Vishakhapatanam port has ranged between 12 – 16 per cent, that of Kandla port 10.5-17 per cent and of Chennai port between 10.5 – 14.1 per cent. The other ports have not displayed much variation in their corresponding shares indicating a possibility that their capacities have fallen short of accommodating increasing volume of traffic.

Chart ‘A’ displays aggregate capacity at all major ports (in million tonnes per annum) and traffic handled by them during last six years. In 2001-02, around 83.6 per cent of the capacity has been utilised. IN the succeeding years, as the rate of capacity augmentation was lower than rate of traffic growth, as much as 96.5 per cent of the capacity had been utilised in 2004-05. However, in the following two years with the growth in the cargo traffic lagging behind that in capacity augmentation, the year 2006-07 saw capacity utilisation of touching 92 per cent. The aggregate capacity of major ports as on March 31, 2007 was 504.75 million tonnes per annum (mtpa). Capacity-wise ranking of major ports reveals that port of Kandla, which has a capacity to handle 61.3 million tonnes of cargo as on March 31, 2007, stands at number one position followed by port of Vishakhapatanam (58.5 million tonnes) and port of Paradip (56 million tonnes).

The non-major ports, as on March 31, 2007, have an aggregate capacity to handle 228.3 mtpa traffic, led by Gujarat which has capacity to handle 182 million tonnes of cargo per annum, followed by Andhra Pradesh (18.5 mtpa) and Goa (11.7 mtpa) and Maharashtra (11.1 mtpa). The total required port capacity by 2011-12 is estimated at around 1,500 mtpa.  The major ports are expected to add about 500 mtpa by this period, the non-major ports are likely augment their capacities by 610.85 million tonne per annum during the same period taking the total non-major port handling capacity to 839.168 mtpa or approximately 46.5 per cent of the aggregate capacity as against 26.6 per cent at the beginning of the eleventh five-year plan period.

Commodity-wise Traffic handled at Major Ports

POL group of commodities form the largest part of the cargo handled by major ports. It had accounted for 43.2 per cent of the total cargo handled in 1996-97 (Annexure 1). Over the decade, its share has declined to 32.5 per cent in 2007-08. Another two important commodities traded include iron ore and coal, which together form around 30 per cent of the cargo handled during the period under review. Noticeably, each of the major ports is known and specialised in handling different types of cargo. For instance, in case of Cochin, Kandla, Mumbai and New Mangalore ports, POL cargo forms more than 50 per cent of the total cargo handled. Though iron ore is another important product traded from New Mangalore port, it is mainly traded at port of Mormugoa, where it accounts of 78 per cent of the total cargo handling of that port. Iron ore also has reasonable share in the cargo handled at ports of Paradip, Haldia and Ennore. However, in case of Ennore and Paradip, coal has a maximum share of 78.3 per cent and 42.6 per cent, respectively. While foodgrains account for less than 10 per cent of the cargo handled at all major ports, fertilisers (raw material + finished) have less than 10 per cent share in the total cargo traffic at all major ports.

Share of Ports in Import, Export and Transhipment

As for handling of import, export of cargo and transhipment, Jawaharlal Nehru port is the only port that has witnessed increase in its share in all the three respects. With regard to the import cargo in the year 2006-07, there are 6 major ports i.e., the Chennai port, the Haldia port, the Jawaharlal Nehru port, the Kandla port, the Mumbai port, and the Visakhapatnam port, which have registered a share more than the average share of 7.8 per cent, as compared to the year 1999-2000 when only five major ports, i.e., the Chennai port, the Haldia port, the Kandla port, the Mumbai port and the Visakhapatnam port, registered a share more than the average share of 7.7 per cent (Table 4). With regard to the export cargo, only five major ports in the year 2006-07, namely, Chennai port, the Mormugao port, the Jawaharlal Nehru port, the Paradip port and the Visakhapatnam port had a share in the export cargo that was more than the average share of 7.6 per cent. In the year 1999-2000, six major ports were relatively better equipped to deal the export cargo, share of which was higher than the average share of 7.8 per cent.

In case of transhipment activities, port of Kandla and port of Vishakhapatanam, which had the largest share of 37.6 pr cent and 31.7 per cent in 1999-2000, have seen sharp declines by 2006-07 and have accounted for 16.6 per cent and 4.5 per cent of the toptal transhipped cargo, respectively. On the contrary, port of Mumbai has recoded a huge increase with its share rising from 4.3 per cent in 1999-2000 to 51.8 per cent in 2006-07 (Table 4).

Commodity composition of the overall trade has shown that petroleum products have seen decline in its share in import, while coal has experienced fall in terms of exports. However, container cargo has witnessed increase in its share, both in terms of import as well as exports (Table 5).

The progress in the total container traffic in the country can be observed from Table 6. Container traffic has increased from 27.7 million tonnes in 1999-00 to 73.4 million tonnes in 2006-07. Only two major ports—the Chennai port and the Jawaharlal Nehru port—have registered increase in their respective share in handling container traffic during 1999-00 to 2006-07. In fact, Jawaharlal Nehru port alone has handled 55.6 per cent of container cargo in 2006-07. The share of port of Mumbai has fall drastically from 22.2 per cent in 1999-00 to 2.2 per cent in 2006-07.

Other Performance Indicators

Two important parameters that need to be observed carefully while measuring the performance of major ports are average turnaround time and average output per ship berth, which help measure productivity of the ports. Fast turnaround for the ships at the ports would give the ships more time for sailing. This correspondingly helps ships earn more freight. Moreover, exporters and importers would be required to maintain fewer inventories and they could also save on expenditures such as freight rates, arbitrarily fixed charges such as Terminal Handling Charge (THC) and Container Detention Charge (CDC) in ports as determined by the ship owners, and other costs such as interest on capital (Larissa M. van der Lugt, et al, 2005).

A port-level comparison reflects that all the ports have improved the efficiency by reducing the average turnaround time of the ships. Of all the major ports, ports of Chennai, Cochin, Ennore, Jawaharlal Nehru and New Manglore have their average turnaround time less than the group average (3.5 days). The average turnaround time of all the ports in 1999-00 was 4.8 days and the number of major ports that experienced average turnaround time less than the group-average were Cochin, Jawaharlal Nehru, Mormugao, New Mangalore and Paradip (Table 7).

As for, the average output per ship day, it has improved for all the major ports over the same period with Jawaharlal Nehru port registering an outstanding performance with average output per ship day growing by 183 per cent from 5905 tonnes in 1999-000 to 16727 tonnes in 2006-07. This shows that despite the congestion and overcrowding, the ports are positively responding to the changing competitive environment by improving the operation efficiency.

(*: This note has been prepared by Miss Pallavi Oak).