The ongoing project awards on national waterways will throw huge opportunities for existing players in the port and port services sector, says Icra. Besides, a significant progress on the Rs 5,400-crore Jal Marg Vikas project is a positive for the Inland Waterways development in the country, the rating agency said. The ‘Jal Marg Vikas’ is a Rs 5,400-crore World Bank funded project on the Ganga, being developed between Allahabad and Haldia to cover a distance of 1620 km. The project envisages the development of a fairway with a depth of three metres, which would enable commercial navigation of at least a 1,500 tonne vessel on the river and overall includes construction of six multi-modal or inter-modal terminals, roll-off roll-on jetties and ferry terminals among others.
“During the last 1-2 quarters, there has been significant development and contracts have been awarded for construction of multi modal terminals, dredging works, navigational locks, etc and there are many other required steps which are progressing at a fast pace to meet the planned target of creating infrastructure to transport over 17 million tonnes annually on this route by 2020,” ICRA said in a report. It said ICRA Research believes that the ongoing project awards as well as similar planned projects on other National Waterways will provide greater opportunities for existing players in the port and port services sector to participate in new projects involving inland water transportation.
“Project awards are being concluded at a very rapid pace and the same augurs well for development of inland waterways and logistics management overall,” it said. Also it said that overall cargo volumes at Indian ports registered a moderate growth in H1 FY 2017. “In H1 FY2017, total cargo handled at the Indian ports registered a modest 5 per cent increase to 549 million tonnes over the corresponding period in previous year. The growth was supported by a doubling of the iron ore volumes as well as a healthy growth of 4 per cent in POL volumes,” it said.
During the first ten months of FY2017, cargo throughput at major ports has registered a 7.1 per cent growth over the corresponding period of the previous year, it said. The growth was supported by a 2.5 times growth in iron ore cargo volumes (39 MT against 14 MT) supported by a resumption of mining operations in Goa, Karnataka and Odisha as well as growth in POL & Liquids (7 per cent) and Other cargo categories (14 per cent), it said.
Projecting stable outlook for the port sector, the rating agency said players will continue to experience healthy growth in cargo in the near term, albeit somewhat lower compared to the recent fiscals, as revival in iron ore exports and pick up in POL volumes as well as impetus for coastal shipping will be partially offset by lower coal imports following the increase in coal production by Coal India Ltd and slowdown in container volumes due to weak exim trade.