Dubai, June 3: They say the Jebel Ali Port is one of the two man made structures visible from space. The other is the Great Wall of China. In less than 10 years since it came on the global shipping map, the port, run by the Dubai Port Authority is handling 2.8 million TEUs a year - three times India's largest container port. And Dubai's policy makers are using the port's growing reputation of good infrastructure and strategic location to get a larger chunk of the world's international trade.Dubai imports literally, everything except oil. For instance, 50 per cent of the 36.4 million tonnes going through the port is destined for Dubai city. The Jebel Ali Port is the entry point for imports for 1.4 billion consumers residing in the Middle East. This means that thousands of containers and ships return from Dubai, empty. Traditionally therefore freight rates out of Dubai have been among the lowest in the world. With logistics managers the world over finding cheaper ways to transport, export out of Dubai isincreasingly being viewed as an advantage. With 125 shipping lines and 11,300 vessels that come calling, scheduling cargo movement out of Dubai is a cakewalk.
Leveraging this, the Dubai government is hardselling the Jebel Ali Free Zone in an area adjacent to the port as a manufacturing base for companies. For those who prefer to manufacture out of their own countries, the free zone is offering some of the best warehousing facilities available in the region. One of the largest transhipment hubs in the region, the port and free trade zone is being marketed as a ideal re-export location, providing a gateway to East Africa. Much of this has been made possible by the huge investments made by the government in developing back up facilities, warehousing and state-of-the-art telecommunications. The free zone only adds to the 200,000 square meters of warehousing already available at the port with an additional 50,000 square meters reserved for cargo agents. For those with perishables in their product portfolio is21,000 meters of controlled temperature warehousing.
It's a strategy that has already begun to work. Over 60 per cent of the Jebel Ali Free Zone will soon be occupied by names like Aiwa, Bose, Sony, General Motors and Unilever. The logistics are working out to be favourable for some Indian companies too. Dabur has set up a packaging unit for its exports to the East African market, SPIC has a $160 million fertiliser unit and several others are reportedly at advanced stages of negotiations with authorities. From less than 200 companies a year ago the number has touched 1,500 this year. Much of this will only add to the traffic for the DPA.
The Jebel Ali facility will also gain from the inefficiency of other ports. For instance, Dubai will work out very cost-effective for some exporters from India who can export in bulk to Dubai and reexport from there, instead of working on a complex scheduling for 20 different destinations, with the accompanying red tape, at Indian ports where not many mainline vesselscome calling. Although Dubai's port authorities are tight-lipped on how much cheaper re-export from Dubai works out for Indian companies, they are using it as an incentive to attract investment.
Explaining the sudden rise of Jebel Ali as the premier port in the region and certainly one of the fastest growing in the world, Nada Kadri, executive, marketing and media relations has attributed it to the quality of infrastructure and productivity. The 67 berth port, with a depth of 14 meters, has productivity a little under international norms, but certainly superior to anywhere else in the region. Turnaround time is 18 hours and productivity is about a 100 teus per hour. With several kilometers of quay length, officials haven't heard of pre-berthing detention.
With re-export emerging as a major component of the economy, authorities are working at reducing evacuation speed with every passing day. Among infrastructure underway are road projects such as the $31 million Al Gharoud Interchange, the $50 millionhighway to Abu Dhabi and the $49.4 million World Trade Centre Interchange.
At the Dubai airport, which is being expanded at a cost of $500 million, a new cargo centre is being planned. An official spokesperson claims that it would take just four hours for cargo to be offloaded from a ship and put on to a flight.
But there is competition from others in the region. Salalah and Eden, the former managed by the Maersk-Sealand combine are expected to add huge cargo handling capacities in the region. But DPA seems unperturbed. It has one major advantage up its sleeve. As Abdullah Lootah, regional manager, Asia Pacific for the Jebel Ali Free Zone says, "With our level of imports, ships will come calling, so we will continue to be able to offer the best freight rates." So whether or not other ports develop, Dubai will continue to be a port of call. And that is one advantage its competitors will find difficult to match.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.