Despite positive moves to reduce the red tape tying up port development, India still needs to do more before it can take its place on the world logistics stage, according to an analyst.
Shailesh Garg, director at industry consultant Drewry, said that the shipping and ports sector in India needs to “develop rapidly to keep pace with Indian trade and to act as a catalyst in economic growth”.
While India has already attracted international container terminal operating groups, there remains an estimated $20bn of further investment needed in the port system.
India’s Ministry of Shipping recent changes to the container terminal concessions rules made them more inviting to private investors. But despite these ‘policy interventions’, the progress of PPP related projects in the sector has still been slower than expected.
“The government therefore needs to introduce substantial policy initiatives for developing the port sector to meet the proposed capacity addition targets,” said Mr Garg. “Apart from the regulatory environment, the government will also need to focus on integrated development, as inadequate road and rail facilities are leading to logistical bottlenecks, resulting in capacity constraints and under-utilisation of port capacity.
“Further, investment in the modernisation of existing ports is critical for removing physical constraints and equipping them to handle modern and bigger vessels.”
Mr Garg will speak on ports, shipping and logistics development across India, Pakistan and Sri Lanka at the upcoming TOC Container Supply Chain Middle East conference, taking place on December 9-11 at the Dubai World Trade Centre, UAE.
Source:- portstrategy.com
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