Seeking to oust Gujarat from the numero uno position in coastal traffic, the Andhra Pradesh (AP) government is readying an ambitious plan for integrated port development. Aware that the state’s 974-km-long coastline can make for huge commercial gains, the AP government is looking to develop new ports—through the public private partnership (PPP) route —modernise existing minor ports and set up port-based industries along the coastal corridor. Inspired by China’s One Belt One Road model, the state is also working on building a strong inland waterway system that is linked to ports through national highways.
To further this agenda, the state government is going to set up a Maritime Board, on the lines of those in Gujarat, Maharashtra and Tamil Nadu. “With the target of overtaking Gujarat in cargo handling in the next four years, the Andhra Pradesh government is chalking out an action plan. Given that Andhra Pradesh enjoys the advantage of being on the East Coast which faces progressive south eastern nations, focusing on development of port-based infrastructure and industries will help the state emerge as a logistics and cargo hub,” says AP
chief minister N Chandrababu Naidu.
The state government has set a target of 10% growth in the next 10 years. Andhra Pradesh’s ports handled 142 MMT of cargo traffic in FY14-15. This year, the state is expected to overtake Maharashtra whose ports handled 150.5 MMT of cargo in FY14-15, next only to Gujarat in the country.
“The state has the potential to become a logistics hub,” says Ajay Jain, Secretary, Infrastructure, AP government. The state government has identified 18 port locations in all. The state plans to set up 14 non-major ports through the PPP route. The 14 notified non-major ports include Bhavanapadu, Meghavaram, Kalingapatnam, Bheemunipatnam, Gangavaram, Nakkapalli, Kakinada SEZ, Kakinada, S.Yanam, Narsapur, Machilipatnam, Nizampatnam, Vadarevu and Krishnapatnam.
Holding that the PPP model is the most feasible one for ports in the state, Naidu has sought development of Bhavanapadu, Machilipatnam, Narsapur, Vanpic and Kakinada ports on a priority basis. “We are approaching the Singapore Maritime University, Korea Research Institute and other institutions to tap the sector’s potential”, he says.
A recent E&Y report says that traffic at eastern ports increased at a
CAGR of 7.4% in the past 10 years and is expected to increase at 15.7% over the next five years. Traffic growth on the east coast is expected to be driven by iron ore, coal and containers which are growing at a CAGR of 22%, 24% and 17% respectively. Dhamra, Gangavaram, Kakinada, Krishnapatnam and Karaikal are some of the significant ports to have been developed by private developers on the east coast.
But major ports on the east coast face various challenges, including low efficiency due to legacy systems and processes, land acquisition problems and non-availability of land, besides regulatory hurdles.
Building a strong inland waterway system which is linked to the ports through national highways is an essential component of the state’s overall plan. “We are in the process of designing a maritime concept master plan,” says the Infrastructure Mission of the government. The state aims to link the inland waterway system of Kakinada-Pondicherry and Kakinada- Bhadrachalam to the nearby ports. Naidu has also sought fast-tracking of the Beach Corridor from Visakhapatnam to Kakinada and Visakhapatnam to Bhogapuram.
As part of the maritime concept master plan, Visakhapatnam, Kakinada, Machilipatnam and Krishnapatnam ports would be developed as coastal cities. The government is also focusing on the development of coastal parks. Among these are a mega interchange hub near Amaravati, pharmaceutical logistics park in Visakhapatnam, food and electronics logistics park at Machilipatnam, and automobiles logistics park and truck terminals in Nellore.