The Hindu Business Line : A tale of two ports

IT is a classic tale of two ports. It is the tale of how one port came up to support the older one and subsequently how the two began to poach on each other's revenue in a game of fierce competition. Finally, it is the tale of how the two ports together have made Mumbai a major gateway for export-import cargoes. That is Mumbai Port and the Jawaharlal Nehru Port.

Indeed, JNPT was set up to de-congest Mumbai Port exactly 15 years ago, but over the years the younger port cut a swathe in Mumbai Port's container traffic. Now, this has prompted Mumbai Port to rework its strategy — it has realised that it is futile to compete with JNPT for container traffic and hence it should sharpen its focus on bulk and break-bulk cargoes.

From being India's premier port in terms of throughput, Mumbai Port's cargo flow began to thin, slipping to the fourth position in 1997-98 and ending sixth during 2003-04.

From 34 million tonnes (mts) in 1995-96, the port's throughput fell to 32 mts in 1997-98 and 26.7 mts in 2002-03.

Last fiscal, however, it managed to halt the downward slide, registering a throughput of 29.9 mts, which was 11.8 per cent higher than the previous year. In fact, during last few years before 2002-03, the port had been registering a negative growth rate, while all other ports had been growing at an average rate of 10 per cent.

Mumbai Port's decline has been mainly in the wake of the increasing trend of containerising break-bulk cargo. And Mumbai Port's loss was JNPT's gain — from 54,643 TEUs in 1990-91, the container throughput at JNPT increased to 1.9 million TEUs in 2002-03 and over 2 million TEUs last fiscal (including the private terminal at the port that is operated by P&O Ports India). In comparison, Mumbai port handled 1.96 lakh TEUs last fiscal, against 2.13 lakh TEUs in the previous fiscal.

But Mumbai Port is not yet willing to give up in the race. In a significant shift in strategy, Mumbai Port will now be sharpening its focus on building infrastructure for handling of break and break-bulk cargoes for the next few years, instead of competing with JNPT for container cargoes. "While 80 per cent of the general cargo the world over is now being moved in containers, in India only 45 per cent of the general cargo is containerised. Hence we believe that at least for the next 15 years, there will be enough potential in India in the break and break-bulk segment," a senior official of Mumbai Port says.

Mumbai Port expects agri-products, including rice, wheat and oil cake, to be a potential cargo for movement in the bulk mode. Also, as movement of steel products cannot be fully containerised, the port expects that this cargo would continue to be shipped in break-bulk form at least for the next eight to ten years.

"Such cargoes will hereafter be our major focus areas," the port official said. In fact, in the current fiscal, the port will be trying to attract new cargoes such as salt and cement, while it expects that car exports by Maruti and other manufacturers will grow.

The port has also realised that to further climb up the ladder by focusing on break and break-bulk cargoes it has to remove certain major constraints that are impeding its operations. First in the list is draft problem. "At present we have a draft of 9.2 mts, which is just not adequate for larger vessels to enter. For this, we are planning to utilise the harbour wall by increasing the draft from 8.5 mts to at least 10 mts in the next one or two years. Significantly, it has been concluded that the harbour wall area, which had been given up for utilisation due to the rocky surface of the seabed, can be dredged," according to the official.

JNPT is also racing ahead with its plans, setting itself a goal of handling 38.8 mts (including 2.73 million TEUs) by 2006-07 and 97 mts (including 6.8 million TEUs) by 2016-17.

And on its drawing board are a string of projects like the setting up of the third box terminal through private participation by 2006, deepening of the main harbour channel at a cost of Rs 2,500 crore by 2010 and development of a fourth and fifth box terminals by 2016 and 2020 respectively at a cost of Rs 1,500 crore each.

Picture by Shashi Ashiwal

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A tale of two ports