Indian Port Investments Pay Big Dividends

In the face of the world’s economic woes, India seeks to improve its competitive position.

In coverage of a highly successful liberalization of ports, the CATO Institute draws attention to the Indian state of Gujarat. The report, “The Benefits of Port Liberalization,” notes that various forms of port liberalization since the 1990s has led Gujarat to become India’s most rapidly growing state, averaging annual increases of 10.14% from fiscal 2001 through fiscal 2006, the most recent years for data. Gujarart is 153 nautical miles northwest of Mumbai.

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In the face of the world’s economic woes, India seeks to improve its competitive position.

In coverage of a highly successful liberalization of ports, the CATO Institute draws attention to the Indian state of Gujarat. The report, “The Benefits of Port Liberalization,” notes that various forms of port liberalization since the 1990s has led Gujarat to become India’s most rapidly growing state, averaging annual increases of 10.14% from fiscal 2001 through fiscal 2006, the most recent years for data. Gujarart is 153 nautical miles northwest of Mumbai.

Swaminathan S. Anklesaria Aiyar, the report’s author, claims that Gujarat has taken advantage of a loophole in the Indian constitution to “convert its minor ports into some of the biggest ports in the country, vastly improve the availability and efficiency of port infrastructure and facilitate the development of industrial centers that otherwise would not have existed.”

Proof of the port’s commitment to enhancing infrastructure comes in the announcement from Gujarat Pipavav Port Ltd. that it is investing an additional € 40 million to dredge its facilities to a 14.5 meter depth from its present 12.5 meter draft to further improve the port’s accessibility. The dredging is scheduled for completion by mid-2009.

In addition to its existing container traffic area the port has constructed an additional container yard to support 600,000 TEU (twenty-foot equivalent units) of cargo. It plans to add another yard to handle 670,000 TEU by the end of 2009.

Philip Littlejohn, the port’s managing director, claims that, “With the deeper draft, Pipavav offers a safe port for the ever larger container vessels that cannot call at major ports in India. The port has road and rail connectivity, and the rail freight costs from our on-dock facility to the north Indian ICDs (inland container depots) are lower and the current maximum capacity of the rail link is 22 trains per day in each direction.”

www.portofpipavav.com

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