India’s goal of being a trade hub hit a major snag on January 11, when the world’s biggest boxship, Ever Alot, gave it a miss because of port infrastructural issues. Meanwhile, the economically hit Sri Lanka and the south-east nation Malaysia have been visited by Ever Alot in recent times.
Although the Jawaharlal Nehru Port Trust highlighted that the Mundra Port run by Adani could handle the 24000 TEU ship, Ever Alot decided to skip it over the lack of a 17-meter draft. To berth the 400 meters long ship, such a draft was crucial.
So far, the Mundra Port has handled ships as big as APL Raffles, a 17,292-TEU ship, in January last year. The vessel was carrying 13,159 TEUs onboard at that time.
According to the director of Drewry Maritime Advisors, Shailesh Garg, increasing the vessel size alone doesn’t ensure better transfer of goods, which relies heavily on road and railway connections with the ports, factories and warehouses.
This is validated by an RBI report highlighting India’s plight in the global value chain due to the lack of proper maritime connectivity. As per the regulatory body’s 2022 report on Global Value Chain (GVC) participation index, India stands at 34% while other south-east nations like Vietnam have crossed the 50% mark.
The country is well below the ASEAN countries’ average of 45.9%. When Mundra handled the APL Raffles, Vietnam had already taken such ships three years before. S&P Global Market Intelligence and the World Bank have given it a 48th ranking in a list of high-performing ports. CEIC Data, a London-based firm, further highlighted the issue when they pointed out that China’s container throughput in 2020 was 245 million TEUs while India was at 16 million TEUs.
As of 2022, such ships that need a 17-meter draft for navigating constitute 0.7% of the global maritime fleet, but their importance is gaining momentum in the trade routes of China and Europe. India being at a crucial geographical position between the Strait of Malacca and the Suez Canal, can become a significant player if the 24-meter draft port in Kerala, the Vizhinjam port, becomes operational. The Adani Group has said it will likely be opened in 2024. The Indian government’s Maritime India Vision 2030 mentions another such port to be operational in 2028 and 18 meters draft port in Maharashtra.
However, Maersk officials said that since the country’s exporters and importers are spread all over the nation, it is much more feasible to ship goods in smaller ships closer to the ports where they are working. They reiterated that port infrastructure is limiting the trading capacity of the country as we require better infrastructural support, like bigger cranes and deeper drafts.
References: NDTV, Live Mint, Economic Times