Boost for the Box Trade
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Ports INTERNATIONAL CONTAINER TRANSHIPMENT TERMINAL BOOST FOR THE BOX TRADE 32 The International Container Transhipment Terminal at Kochi, which will soon be operational, is all set to transform the Indian ports sector. The transhipment terminal will handle the largest container vessels in the world, helping Indian industry save millions of dollars every year, writes N. B. Rao. HE historic city of Kochi 16th century, later became the ‘viceroy’ (formerly Cochin) has attracted of Portuguese India and died in the city in global traders in search of 1524. He was buried in Kochi for a while, exotic spices, silk and gold for before his remains were shipped back Tcenturies. Many of the Colonial powers, to Portugal. Travellers from China, the including the Portuguese, the Dutch and Middle East and Europe were frequent the English, established their base in visitors to the city, which happens to the city. The Portuguese set up the first be the only Indian city in proximity to European settlement in India at Kochi in the global maritime highway, linking the 1500 and it remained the capital of Portu- crucial east-west routes from Europe to guese India for a decade. the Far East and Australia. Portuguese explorer Vasco Da Gama, With the commissioning of the first who landed in Kochi in the early part of the phase of the ambitious, International 33 PORTS ‘THE TRANSHipMENT HUB WILL AccELERATE CONTAINER TRADE’ An interview with Suresh Joseph, general manager, DP World Cochin, which is developing the International Container Transhipment Terminal, Kochi: When is the International Contain- dertaken by the government that clearly additional handling and ultimately higher er Transhipment Terminal, Kochi, demonstrated the geographic advantage costs of transportation, which made In- expected to become operational? that Kochi enjoyed, being strategically po- dian goods less competitive overseas A firm date is yet to be finalised. How- sitioned in proximity to the major global when compared to China, Vietnam and ever, it is expected to go on stream in the east-west trade routes. other south-east Asian countries. first quarter of 2010. Global trade has never been able to Today, 45 per cent of India’s trade is capture the complete potential of India’s transhipped over hub ports such as Co- What would be the impact of the booming economy due to limited infra- lombo, Salalah and Jebel Ali in the UAE. new terminal on India’s external structure. Road and rail facilities were Container trade in India has been growing trade, in terms of cost and time not adequate enough to meet growing year-on-year by 15 per cent; the develop- savings? demand, and port infrastructure was not ment of a transhipment hub within the For close to two decades the pro- able to service large container ships. country will only accelerate this growth posed development of a world-class con- This resulted in the emergence of further. tainer transhipment terminal was on the transhipment hubs such as Colombo, the The commissioning of the ICTT and drawing board. Several studies were un- Sri Lankan capital, and Salalah in Oman, the consequent calls of mother ves- 34 PORTS Container Transhipment Terminal (ICTT) in March-April this year, Kochi is all set to sels to it will bring international markets by 2015, with a design capacity of 3 mil- regain its historic position as a pre-emi- closer – and render the products cheaper lion TEUs, ICTT Vallarpadam should be nent port on the international sea route. – for Indian importers and exporters, by handling close to 20 per cent of India’s Importantly, the establishment of avoiding a foreign transhipment loca- total container traffic. the ICTT would enable large containers tion. Moreover, inventory-carrying costs and carriers to dock at an Indian port for will also be positively impacted with the Will the new terminal be able to the first time, instead of off-loading and commissioning of the ICTT. accommodate large container uploading cargo at transhipment hubs vessels with capacities of over such as Singapore, Colombo, Salalah and What is the total investment in 15,000 TEUs? Dubai. this project, both by DP World The design of the ICTT includes a The absence of such a hub port had and other partners? draft of 14.5 metres. Such a draft will fa- resulted in large vessels and mother The ICTT is being built in three phas- cilitate the handling of the largest vessels ships docking at other international ports. es. The first phase, which is due for afloat today, such as the Emma Maersk, Indian exporters and importers had to commissioning in 2010, will see an in- which has a carrying capacity of 12,000 ship their cargo in smaller vessels from vestment of close to US$ 270 million by TEUs. international transhipment terminals, DP World and the other shareholders of resulting in an increase in navigation time the company, and US$ 320 million by the What is the largest container and costs. Indian government. vessel that any Indian port/ terminal can accommodate at What kind of revenues do you present? expect to generate in the first At present the only port in India that year and in the fifth year of can handle fifth/sixth generation con- Indian industry operations? How much of India’s tainer vessels is Vishakapatnam port. It would be total container traffic would be has a draft of 16.5 metres. The rest of handled by ICTT? the ports in India can only handle vessels able to save It is difficult to project the exact quan- with a carrying capacity of a maximum of tum of revenue that ICTT could generate, 6,000 to 8,000 TEUs. about US$ 215 because it is the very first of its kind for India. The transhipment terminal at Val- What is the state of rail and road million annually larpadam, Kochi, is unique in its position. connectivity from the ICTT? Will It is one of the only global transhipment they be in place by the time the with the hubs supported by a hinterland that ex- terminal is inaugurated? tends across the country and has a cap- The rail connectivity works are going commissioning tive volume of more than 8 million twen- on well and are likely to be completed of the ICTT. ty-foot equivalent units (TEUs). well ahead of the commissioning of the Creating a transhipment hub within terminal. There have been some chal- the country will now give importers and lenges resulting in a delay in the comple- N Ramachandran, exporters alternative solutions to moving tion of road connectivity works. How- chairman, Cochin Port Trust their cargo at lower costs. Businessmen ever, the National Highways Authority of can now choose from road, rail, coastal India (NHAI) has assured the Cochin Port “Indian industry would be able to and inland waterways – an inter-modal Trust that a two-lane motorable highway save about US$ 215 million annually with medium best suited to their requirement would be available by the end of March the commissioning of the ICTT at the of cost and time. 2010. all-weather Cochin Port Trust (CPT),” The government is investing heav- says N Ramachandran, chairman, CPT. ily in the support infrastructure for this Is this the largest project that DP He expects savings of about US$ 200 for project – a new four-lane national high- World has executed in India? How each container and a seven-to-eight day way connecting the terminal to the west would you compare it with other reduction in voyage time. and east coasts, and to south and central DP World projects elsewhere in “The ICTT will position India as a India is being developed. Further, a new the world? transhipment hub, conferring major 8-km-long electrified rail link will give the The ICTT is the largest port project advantages to Indian exporters in terminal a handling capacity of 15 trains undertaken by DP World in India. The terms of reduction in feeder service daily and connectivity to India’s national ICTT is unique in the DP World portfolio cost and faster shipping service if the rail network. in that it is one of the largest investments cargo is routed through Kochi instead of In the final phase of its development of DP World in emerging markets. Colombo, Sri Lanka,” notes an analyst at Frost & Sullivan, an international consul- 35 PORTS SpiN-OFF PROJECTS The International Container Transhipment Terminal (ICTT) at Vallarpadam on the outskirts of Kochi has triggered off a flurry of infrastructure development projects in and around the commercial capital of Kerala. The major projects worth over US$ 2.15 billion include: • A 4.62-km railway bridge, India’s longest, connecting Vallarpadam to Edapally at a cost of US$ 65 million • A liquefied natural gas (LNG) terminal to handle 1 million tonnes of LNG, costing nearly US$ 350 million • A 1,250 MW power plant at Puthuvype near the LNG terminal • A US$ 325 million port-based special economic zone (SEZ) • An international ship repair complex costing nearly US$ 70 million • Single buoy moorings for Kochi Refineries Ltd at a cost of US$ 155 million • A US$ 1.5 billion petrochemicals complex (at a later stage) • An international cruise terminal at Willingdon Island costing US$ 85 million • International bunkering terminal • International marina tancy. “The absence of a hub port in 95 per cent of India’s exports by volume international and domestic traffic stood India resulted in a significant share of and 70 per cent in value terms. at 9.1 million twenty-foot equivalent containers leaving an Indian port going “Indian merchandise export and units (TEU) in 2008; this is projected to through a feeder, with transhipment import registered a double-digit growth touch 21 million TEUs in 2014.