Saturday, August 30, 2008

Indian Container Market - A Study


* The Indian container market continues to grow rapidly, at 15-20 per cent per year. In the next five years, container traffic is expected to double in volume to 12.5 million TEUs per year.

* The growth in container traffic is being fuelled by a host of factors. These include high GDP growth, big increases in imports and exports, rising share of finished goods (such as cars, garments and electronics), growth in agricultural products trade, etc., etc.

* It is important to note that this growth is occurring despite the bottlenecks caused by inadequacies in port capacity, rail infrastructure, road capacity, multimodal connectivity, warehousing/storage, customs efficiency and use of information technology.

* This level of growth, however, will continue only if we address and remove these bottlenecks

* We will need to develop more container terminals and increase draft levels to allow bigger ships to ply. We will have to increase rail capacity by adding more container trains, high-speed trains, doublestack trains, dedicated freight corridors, etc. We will have to improve road connectivity as well as road quality. We will have to upgrade warehousing/storage facilities with more ICDs, CFSs and full-fledged logistics parks and centres. We will have to introduce a wide range of value-added services that define modern logistics. We will have to increase the level of automation and use of IT to make this a true e-business. We will have to improve multimodal connectivity. And we will need a more efficient, modern and simpler customs process.

* These are ambitious tasks, to say the least. But the good news is that steps are already being taken in some of these directions. The container capacity at ports will more than double in the next five years. We have seen a big increase in container trains and also some progress on the freight corridor. Road transport is also improving with greater width, higher quality and better-managed fleets. A number of state-of-the-art logistics parks are being developed. Major rail-port and road-port connectivity projects are finally getting off the ground. All of this progress is being hastened by more rational policies and greater private participation.

No comments: