The Hindu Business Line : `Kandla port's value proposition difficult for others to match' — Mr A. Janardhana Rao, Chairman, Kandla Port

AMONG the 12 major ports in the country, Kandla in Gujarat lays claim to be the second largest in terms of the total cargo handled. With two large ports — Pipavav and Mundhra — coming up in its vicinity, it would be expected that Kandla would be given a run for its money. But the port's newly-appointed Chairman, Mr A. Janardhana Rao, is unfazed. Mr Rao, who has earlier worked at Kandla as Financial Advisor and Chief Accounts Officer, told Business Line that the competitive pricing offered by the port will ensure that it continues to attract business.

Excerpts from the interview:

With two large ports in your vicinity, how will Kandla retain its edge?

The two ports do not mean any loss of business for us, as you would be well aware that the per tonne handling cost at Kandla Port is the lowest among the major ports. We continue to offer a value proposition to our users that is difficult for the others to match.

Our cargo volumes have been expanding. In fact, on October 26, we established a new record of highest single-day cargo in our history, when we handled 1.23 lakh tonnes of cargo. That was significantly higher than our previous best of 1.12 lakh tonnes on June 28, 1999.

On an annual basis, our traffic volumes have been rising steadily in the last three years. In 2001-02, we handled 377.3 lakh tonnes, which rose to 406.3 lakh tonnes in 2002-03 and to 415.3 lakh tonnes last year.

What are the immediate plans for the port?

We have embarked on a major expansion plan which is well formulated. This is indicative of the development planned for the port with an investment of Rs 5,000 crore to achieve 90 million tonnes handling capacity by 2014-15, for which we plan to construct five new cargo berths at Kandla, four more at Tuna/Satsaida Bet and a single point mooring in Kandla port waters.

The supporting infrastructure to attain 90 million tonnes productivity will be raised by creating infrastructure through private/public sector participation. After the commissioning of the 11th berth last year, we are now equipped to handle Panamax vessels.

We are now working on berth numbers 12 to 14 that would gear us for post-Panamax capability where ships of 240 metres length and DWT (dead weight tonnage) of 75,000 MT will be able to berth directly.

The capital expenditure for the 12th berth will be about Rs 48 crore and the tendering process is now underway. We are also working out the modalities of the 13th and 14th berths, which will come up on Build-Operate Transfer (BOT) basis.

In line with the expectations of trade, Kandla port is in the process of developing a container terminal with private participation, for which tenders have been called.

We hope to finalise the operator by March 31, 2005, which will herald a container berth at Kandla port with a high exponential rate.

We have already earmarked the required berths and back-up area for the container yard at an estimated Rs 175 crore.

What is the draught being offered by Kandla as of now and what efforts are you taking to improve it?

We recently achieved a draught of 11.5 metres, which is our highest. This will go up to 12.5 metres in the next couple of months and further to 13.5 metres by the end of next year. For the last three years, we have been carrying out massive dredging to increase draught.

The total outlay for the project has been pegged at Rs 123.5 crore. This will gear us for the Post-Panamax capability. Studies are also underway to explore the possibility of attaining 14-14.5 m of draft within five years to accommodate large size main line container vessels.

On the cargo handling front, what efforts are being made to enhance productivity and reduce vessel turnaround time?

We recently commissioned three new wharf cranes with 25 tonnes and two new wharf cranes with 16 tonnes capacities at Rs 33 crore. These cranes have a rated capacity of 600 tonnes per hour.

Another three cranes of 25 tonnes capacity will be commissioned by next year. Berthing policy has also been modified with philosophy to attain maximum productivity and accommodate larger vessels by introducing priorities for higher productivity vessels.

To meet the growing requirement of storage space, the port has added 67 hectares of additional custom bonded area. After the 2001 Gujarat quake, extensive building activity was taken up and five new godowns were built by the Port Trust to compensate for the loss.

We have added five more godowns last year and an equal number will be ready next year. By December 2005, Kandla will have a total of 30 godowns with a total storage capacity of nearly 3.92 lakh tonnes.

We have also allotted an additional 300 acres of land for expansion of the existing Kandla Special Economic Zone, which is just 10 km from the port. The close proximity of the SEZ to the port gives us a unique advantage.

What efforts are being made by the port to improve its connectivity with its hinterland?

To reduce the distance from the hinterland to the port, Kandla has signed a Memorandum of Understanding as an equity partner for a special purpose vehicle created by the Ministry of Railways to convert the 250-km Palanpur-Samkhiali meter gauge line into broad gauge.

That will reduce the distance from the hinterland to the Port by 114 km and bring down the freight costs and lead time to Kandla.