India Haldia Port Modernization Project Field Survey: August 2003 1
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India Haldia Port Modernization Project Field survey: August 2003 1. Project Profile and Japan’s ODA Loan China New Delhi Nepal Bhutan Bangladesh Calcutta Myanmar India Thailand Project site Project site The No. 2 oil jetty constructed using project funds 1.1 Background There are 11*1 major ports, including Bombay, Madras, Calcutta and its outer port Haldia, and about 140 minor ports along India’s 6,000-kilometer coastline. Haldia Port is located on the right bank of the Hooghly river – a tributary of the river Ganges. Development of Haldia Port as an outer port for Calcutta started during the 1960s; however, growth in vessel size in recent years and the geographical constraints of the Calcutta Port Complex led to a strengthening of its role as a substitute port, and cargo volume was increasing every year. However, development of port facilities did not keep pace with growth in demand, weight limitation was necessary because structure of the existing oil jetty was unstable due to river bed erosion, and some facilities were damaged. Furthermore, the port could not meet demand for the transport of crude oil and petrol, oil and lubricants (POL) because of shortage of oil handling facilities, and container handling capacity was also insufficient. As a result of these problems, port operation was inefficient. Thus, it was clear that Haldia Port would not meet the expected increases in cargo handling demand. 1.2 Objectives The project’s objectives were to increase the cargo handling capacity and improve operational efficiency at Haldia Port, West Bengal, which is the main port at the mouth of the River Ganges, by developing an oil jetty and other facilities, and thereby contribute to economic growth in the region. 1.3 Output The outputs of this project were as follows. A. Construction of the No. 2 oil jetty (1) No. 2 oil jetty (for 150,000 D/W class tankers; water depth: 12.2m) (2) Incidental facilities 1 There were 11 major ports at appraisal, but this had increased to 12 when this evaluation was conducted.. 1 · Fire fighting equipment · Waste oil disposal facilities · 2 tug boats (traction: 35 tons; also used as fire boats) · Navigational and Berthing Aids · 1 trawler (200 HP) B. Reinforcement of the existing (No. 1) oil jetty C. Procurement/installation of cargo handling equipment · Portainer 1 · Transtainer 1 · Traictor 5 · Chassis 10 Of total project costs of 8,525 million yen, the ODA loan covered the entire foreign currency portion (3,463 million yen) and a part of the local currency portion (328 million yen when converted) for a total of 3,791 million yen. The remaining local currency portion was covered by a loan from the central government and funds from the executing agency. 1.4 Borrower / Executing Agency The President of India / Calcutta Port Trust 1.5 Outline of Loan Agreement Loan Amount 3,791 million yen Loan Disbursed Amount 1,933 million yen Exchange of Notes August 1986 Loan Agreement December 1986 Terms & Conditions Interest Rate 3.25% Repayment Date 30 years (Grace Period) (10 years) Procurement Partially untied Final Disbursement Date December 1992 2 2. Results and Evaluation 2.1 Relevance As stated above, at the time of appraisal (1986) factors necessitating the implementation of this project had already been confirmed: growth in cargo volume (54.6 thousand tons in FY 1980 → 65.4 thousand tons in FY 1984), insufficient oil handling facilities, and the instability of the existing oil jetty. In addition, the following needs were reconfirmed by the interview with the executing agency during this evaluation. (1) There was growing demand for crude oil in the hinterland of Haldia Port. Specifically, there were plans to expand Haldia Oil Refinery, which is run by the Indian Oil Corporation. (2) The No. 1 oil jetty had safety problems (at the time), and it was hoped that cargoes could be handled elsewhere until the problems were resolved. In addition to the aforementioned needs, the project was also in line with the India’s seventh five-year plan, and is judged to have been highly relevant at the time of appraisal. In India’s ninth five-year national development plan, the planned cargo handling capacity of major ports was to be 344.4 million tons at the end of the plan, however, the actual volume is 289.1 million tons. In the tenth five-year plan (FY2002-2006), the government states that as the cargo handling capacity is not a constraining factor any longer, it is now necessary to improve the quality of services and shorten the number of waiting days. In addition, the cargo handling capacity will be increased to 415 million tons (annual growth of 6%) at the end of the tenth five-year plan (2007). In terms of improving the services provided by existing port infrastructure and shortening the waiting time, there are strong policy-based connections between this project and India’s tenth five-year plan, thus the relevance of the project remains sufficiently high even now, while the plan is being implemented. 2.2 Efficiency 2.2.1 Output The output was originally planned to include the following three components; however, items (1) and (3) were excluded (see a conceptual diagram of Haldia Port below). (1) Reinforcement of No. 1 oil jetty → excluded (2) Construction of No. 2 oil jetty and incidental facilities → implemented (3) Improvement of cargo handling facilities → excluded Component (1) was financed by the executing agency and excluded from the ODA loan portion of the project. However, the details of the problems with the jetty were identified via a comprehensive investigation by the executing agency, and each of the piles supporting the jetty was reinforced (1997). Bidding for the execution of work to reinforce the fender system*2 is currently under way. 2 Fenders refer to the buffering devices that are set up on quays to prevent hull damage during cargo loading. 3 The addition of container berthing facilities mentioned in (3) was excluded from the output as the result of delays in gaining approval from the government in connection with the detailed design. Subsequently, demand for container transport has increased at Haldia Port and the executing agency procured two RMQC and four RTG*3 with its own funds. Conceptual Diagram of Haldia Port [Legends] Roads Railways Station Various buildings: ①Port house ②Jawahar tower ③Officers’ club ④Circuit house ⑤Training institute ⑥Marine house ⑦Master control tower ⑧Chiranjibpur operational 流Upstream building River Hooghly Residential area Component (2) (construction of No. 2 oil jetty and incidental facilities) was executed almost according to the original plans. However, some minor adjustments were made based on geographical and physiographical conditions at the site. These adjustments were made in consideration of the environment (to minimize the impact of the jetty on tidal currents in the river) and in response to recommendations*4 made by the Oil Coordination Committee (OCC), a governmental organization. According to the executing agency, these adjustments had no adverse effect on the project effects. To summarize, there were appropriate reasons for changing the output, the components that were excluded not funded by the Japanese ODA loan, and there are not any specific problems. 3 Respectively, the abbreviations for Rail Mounted Quay Cranes and Rubber Tiered Gantry Cranes; both refer to crane form. 4 Specifically, the OCC recommended reinforcements to walkway materials, changes to fire fighting equipment (pump types), etc. 4 2.2.2 Implementation Schedule According to the executing agency, the following delays occurred in the implementation schedule. Planned and Actual Schedule Item Planned schedule Result L/A conclusion October 1986 December 1986 Prequalification April 1986 – June 1986 September – December 1986 survey Bidding July 1986 – April 1987 January 1987 – August 1988 (A)* January 1987 – February 1989 (B)* Construction May 1987 – October September 1988 – April 1990 (A) 1988 March 1989 – January 1991 (B) A: International bidding portion (platform, dolphin, loading arm, etc.) B: Local bidding portion (approach, walkway, etc.) The delays were attributed to changes in the bidding system. Initial bidding was undertaken for both international (foreign currency) and domestic (local currency) portions together, however, because the price for the local currency portion was higher than expected, the foreign currency and local currency portions were separated and the bidding was undertaken again. The entire bidding period was prolonged. Moreover, although construction work proceeded at a favorable pace, the domestic (local currency) portion was prolonged due to the effects of tidal currents. As a consequence, the entire project was delayed by 28 months. However, because the facilities expansions of the Indian Oil Corporation, the major user of the port, were moved back to 1997, these delays had no significantly adverse effects on initially targeted project benefits (to increase port trust revenues by increasing cargo volume). 2.2.3 Project Cost A comparison of planned and actual project costs is given below. Comparison of Planned and Actual Project Costs Foreign currency total Local currency total Output (million yen) (100 thousand rupees) Planned Actual Planned Actual (1) Reinforcement of No. 1 oil jetty 543 － 289 － (2) Construction of No. 2 oil jetty and 1,580 1,933 2,189 4,246 incidental facilities (3) Improvement of cargo handling 1,025 － 342 － facilities (Reserve fund, price escalation) 315 － 555 － Total 3,463 1,933 3,375 4,246 Further, details of the costs involved in the construction of the No. 2 oil jetty are given below. 5 Comparison of Original and Actual Costs for No. 2 Oil Jetty Foreign currency total Local currency total Total* Item (million yen) (100 thousand rupees) (million yen) Planned Actual Planned Actual Planned Actual 1. Berthing/mooring 920 540.19 198 516.85 1217.00 961.42 facilities 2.