The need for significant enhancement of our port capacity through the creation of additional capacity as well as improving existing capacity and efficiency is not only well recognised, but also under active implementation through various government programmes. However, a sense of urgency seems to be lacking, though no one particular agency can be blamed for that.
Perhaps, it is the inherent lack of empathy that the government departments have for each other that leads to the lack of coordination and delays. Or perhaps it is the lack of clear institutional accountability.
However, what is very clear is that it is not for want of good ideas or funds that solutions are not implemented quickly. In the case of the port sector, the government has indeed carried out several noteworthy studies, identified the problems and also made recommendations for improvement. For example, the ministry of shipping?s report on port dwell time has very specific actionable recommendations to improve port efficiency.
Apart from the institutional issues, there are three important factors that contribute to India?s port capacity issues, most of which relate to obsolete mindsets: short-sightedness while planning investments, hesitation to go for a high level of automation, and an almost single-minded belief that small is beautiful. Let us review each of these issues individually and discuss ways to overcome them.
Whenever we have looked at planning for investment in ports, we always seem to take the risk-averse position of saying that volumes may not grow fast enough on a sustained basis?be it relating to container traffic or bulk. Actual traffic volumes have always proven us wrong. Rapid economic growth always results port capacity having to play catch-up. Our port planners need to be brainwashed into accepting that port capa-cities should lead economic and export-import growth and not the other way around.
We should no longer think of planning to overcome shortages; we should be planning for oversupply. And let it also be clear that claiming we don?t have enough money is a myth. Just talk to all those developmental banks?the World Bank, ADB, the bilateral ones like JBIC, etc?and you will know that I am dead right.
Just a quick visit to Singapore port or Rotterdam will convince you of the other two issues: level of automation and sheer size.
I don?t really see the point of this obsession with making do with less than the best automation. Ports are not the best places to try and balance labour utilisation and use of automatic handling equipment. The world has long realised that ports have to be fully and highly automated if they are to be efficient and competitive.
We need not reinvent the wheel and try to figure out if this is true. Automation is not just desirable, but essential. Whether it is for the evacuation of bulk material or loading/unloading containers, an electronic data interchange enterprise for information exchange, or enterprise resource planning for port processes, we need to invest in the best technology. No doubt, this will take time to implement, but the earlier we begin the process in right earnest the better. Ad-hoc investments will not do. Integrated, planned and large investments are required and we should start now.
The third mindset we have is an antipathy to size. The ministry?s own team that visited Rotterdam port records that the total quay length there is 77 km and quay cranes are capable of reaching across 22 rows of containers! Our ports are no comparison to the size of international ones like Singapore or Rotterdam or those in China. In fact, the way our minor ports are springing up, without even a coordinated plan, we will soon have micro-ports and not minor ports.
International experience suggests that size is critical to achieve efficiencies and cost competitiveness. The whole issue of our maritime states competing with each other by creating many small ports is not only sub-optimal for themselves, but also for the whole industry. It is high time we have strong leadership from the Centre at national-level planning, notwithstanding the legal and constitutional issues involved.
Focusing on these mindsets need to not take our eyes off traditional good practices?of process reengineering, enhanced coordination amongst all agencies operating in the port, better evacuation and connectivity with rail/road, etc, which can also contribute significantly to the capacity improvement programme. Most of these are to be worked out at the individual port level, with perhaps overall guidance and some money being given by the centre. And such improvements, as the Japanese say, have to be on a continuous basis and not just a one-off exercise.
?The author is leader, transportation & infrastructure practice, PricewaterhouseCoopers