Why Adani Ports’ 300 mt cargo handling mark is a crucial success story for India’s maritime sector

Adani Ports and Special Economic Zone Ltd (APSEZ) has sailed past the milestone of handling 300 million tonnes (mt) of cargo across its 12 ports this year on the back of a sharp rise in India’s export-import trade. It was achieved in 22 years since it first began operations at its flagship port in Mundra, Gujarat.

While it took 14 years to achieve the first 100 mt annually through five ports, APSEZ doubled it to 200 mt annually through nine ports in the next five years. Now, with 12 ports under its belt, APSEZ saw its cargo volumes zoom from 200 mt to 300 mt in just three years.

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Adani Ports hits 300 million tonne cargo mark

India’s exports and imports (in value terms) have clocked a robust 46.49 per cent and 59.96 per cent growth, respectively, after a two-year hiatus owing to the pandemic-led weak demand in the domestic and global markets. India crossed $400 billion in merchandise exports on Wednesday.

Growth in containers handling

For the maritime sector, this trade growth has resulted in a 6-7 per cent growth in cargo handling at all ports across India’s coastline. Specifically, the containers handled at Indian ports have sharply grown at 13.4 per cent over the 11 months of FY22, in sync with the overall trade growth.

FILE PHOTO: A general view of a container terminal is seen at Mundra Port, one of the ports handled by India’s Adani Ports and Special Economic Zone Ltd, in the western Indian state of Gujarat April 1, 2014.

Port industry sources said that APSEZ has played the India growth story well with world-class infrastructures and physical performances, combined with a customer-centric culture, aided by digital interventions.

APSEZ, India’s largest integrated transport utility, grew by 21.6 per cent (all India growth of 6.4 per cent compared to 28.0 per cent at APSEZ) for the 11 months of FY22. With more than 80 per cent of India’s consumption and industrial hinterland being covered, APSEZ is strategically and critically aligned to the country’s needs.

Strategic locations

“APSEZ’s strategy of providing multiple entries and exit points by diversifying our geographic footprint, single-window service to the shipping lines, integrated supply chain solutions to end customers, alongside partnering with large shipping lines through joint ventures enables and fosters continuous gain in market share,” said Karan Adani, Chief Executive Officer, APSEZ.

The port operator owned by Gautam Adani runs the largest commercial port in India (across public and private ports) at Mundra. Mundra serves India’s north-west hinterland, with almost half of the market share for manufacturing and agriculture trade on an origin-destination basis.

Ports’ sphere of influence

In 2021, Mundra joined the league of top 25 global container handling ports, according to Alphaliner. Hazira port is a dominant gateway port for the Ankleshwar-Vapi region which is a chemical hub of the country. Katuppalli and Ennore ports serve the auto manufacturing industry with a growing share in the hinterland.

Krishnapatnam port serves the power needs of Andhra Pradesh with two critical thermal power plants located in its vicinity apart from serving the steel industry and agriculture sectors in the hinterland.

Gangavaram port is uniquely positioned with a port-based steel plant (RINL) next door while Dharma port is a dominant player in the steel hub of Kalinganagar and Jharkhand region. The under-construction Vizhinjam port along with a planned container terminal at Colombo port will serve as transshipment hubs in the region.

FILE PHOTO: A dozer unloads wheat next to a ship at Mundra Port, one of the ports handled by India’s Adani Ports and Special Economic Zone Ltd, in the western Indian state of Gujarat April 1, 2014.

Among the cargo segments, APSEZ runs the largest container handling facility in India. It has a market share of 42 per cent in containers and is on course to handle almost half of India’s total containers soon.

“Our efforts to strengthen the position in container segment at newer locations and offer unique solutions to shipping lines resulted in the addition of eight new container services of which five services were added at Mundra port and one each at Hazira and Kattupalli ports,” Karan Adani said.

Dedicated Freight Corridor

Mundra’s alignment to the Dedicated Freight Corridor (DFC) is adding seamless container evacuation. Double-stack containers movements in and out of Mundra and opening of part of the DFC stretch has begun to improve the turnaround time in the circuits and narrowed the time-lapse for containers between the consumers and Mundra port, Karan added.

On the west coast, Mundra port is on course to become a 150 mt cargo handling port early next year while the combined west coast cargo handling is closing in on the 200 mt mark. On the east coast, APSEZ has crossed the milestone of handling 100 mt in the current fiscal with the east-west parity of cargo handled at ports now at 38 per cent in the east coast to 62 per cent in the west coast.

Sectors served

APSEZ has a dominant market share of some 45 per cent of India’s thermal coal imports and about one-third of coking coal imports. India is critically dependent on fertiliser imports for its agricultural sector. APSEZ handles almost 40 per cent of India’s fertiliser imports at its port facilities. It also handles about one-fifth of critically important edible oil imports at its ports.

ASPEZ handles almost one-fifth of steel exports, fourth-fifth of specialised chemicals, about one-tenth of crude imports and almost half of India’s salt exports.

India’s share in world merchandise trade is projected to grow to 5 per cent by 2025 from 1.7 per cent in 2019. The signing of free trade agreements with many nations will translate into a sustainable high-growth trajectory for APSEZ and help achieve the target of handling 500 mt of cargo by 2025 and emerge as the world’s largest private port company by 2030, Karan added.

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