JNPT plans `500-cr capex

INDIA’S largest container port, Jawaharlal Nehru Port,willbespendingnearly `500 crore in the next twothree years to beef up evacuation of cargo from the port and further increasing connectivity with the hinterland. This investment will go towards building a coastal shipping berth and a common railway yard.

Atpresent,onlyabout18%of the cargo is moved out of JN Port through rail. However, the portplanstoincreasethisshare to 30% in the next few years. Also, in line with the central government’s thrust on coastal shipping and inland waterways, the port plans to have a dedicated berth which will enable it to offer faster movement of cargo at economical rates.

These investments are in additiontothenearly`13,000crore worth of projects that are currently underway at the port. The projects include an over `7,900-crore fourth container terminal with 4.8 million TEU capacity, a `2,000-crore dredging project to increase the draught of the port channel from the current 14-15 m and a `3,000-crore JN Port road expansion project.

Indeed, with these measures, JN Port is trying to hold onto its position of the largest container port and remain competitive with private ports, especially in the neighbouring state of Gujarat. However, analysts say, it will be a hard race against time.

Edelweiss, in a June 2016 report, said of late, JN Port has lost part of its north-bound market share to Mundra/Pipavav primarily due to capacityconstraintsandadversepricing by cargo terminal operators, whose import NEERAJ BANSAL, chargesareabout8-10%higher.

“Management initiatives are incentivising faster port evacuation through rail movement via CFS/ICDs and ensuringtimelyexpansion.However, in the interim, Gujarat’s private ports may capture more of JNPT’s north-bound traffic (about 25% of volumes),” the report said.

JN Port deputy chairman Neeraj Bansal said the port is aware of the constraints, but, with the initiatives underway, it expects to continue on its growth trajectory. He said at present the port is facilitating movement of cargo through coastal route only during certain designated hours, and offers rebate in tariffs as per government guidelines to promote coastal shipping.

“Wearenowcontemplatinga dedicatedberthforcoastalshipping, which will have a green channel and will enable movement of cargo from one Indian port to another seamlessly. We willbeawardingthecontractfor construction of a new jetty in the next five-six months,” he said. As for the railway yard, he said the port has already awarded the work for construction of the common rail yard to Indian Port Rail Company, under the ministry of shipping.