1

Sunil Thakur & Vijaykumar Kothiya

Potential Development of Indian Seaports

& Container Transshipment Hub

Unit (Master of International Business Management)

2023- 2024
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VAASAN AMMATTIKORKEAKOULU
UNIVERSITY OF APPLIED SCIENCES (font size 12)
Name of the Degree Program (e.g. Sähkötekniikka/ Liiketalous/ Hoitotyö, font size
12)

ABSTRACT

Author Sahebi, Daniel

Title Potential Development of Indian Seaport & Container
Transshipment Hub
Year 2024
Language English
Pages 80 + 7 Appendices
Name of Supervisor Sunil Thakur & Vijaykumar Kothiya

India's economy is among the fastest-growing globally, currently holding the 13th
position in container throughput. Despite this, a significant portion of its container
traffic is transshipped through international hubs such as Dubai, Singapore, and Co-
lombo. This rerouting leads to substantial revenue losses for Indian ports, estimated
between $400 to $600 million annually. This study explores the possibility of trans-
forming twelve main public ports in India into major transshipment hubs or regional
transshipment centers, aiming to retain more revenue and reduce costs. Through a
comprehensive literature review, key characteristics of an ideal transshipment hub
were identified and ranked based on their importance in relevant studies.

A multi-case study was then conducted on two emerging port projects and six oper-
ational ports located on India’s eastern and western coasts. These ports were evalu-
ated using the SWOT analysis method to assess their potential as transshipment
hubs. According to the findings, Jawaharlal Nehru Port Trust (JNPT) and Vishakhapat-
nam emerged as the ports with the greatest potential to become transshipment hubs
in their respective regions. Enhancing these ports could significantly reduce India's
dependency on foreign hubs, streamline ship-ping operations, and improve eco-
nomic efficiency. This development would not only save costs for local traders but
also position India more prominently in the global maritime trade landscape.

Keywords: Throughput, Transhipment, SWOT, Research, Potential

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CONTENTS
ABSTRACT

1 INTRODUCTION .............................................................................................. 10
1.1 Background ............................................................................................. 11
1.2 Indian Shipping Sector ............................................................................ 17
1.3 Purpose of this research ......................................................................... 19
1.4 Research Questions ................................................................................ 20
1.5 Research Methodology ........................................................................... 21
1.6 Thesis Structure ...................................................................................... 24
2 LITERATURE REVIEW....................................................................................... 25
2.1 Overview of Global Container Liner network ......................................... 25
2.2 Role of Container transport and Ports in the country’s economy ......... 30
2.2.1 Performance of Maritime Transport and the Indian Economy .. 32
2.2.2 Importance of Transhipment Hubs ............................................. 35
2.2.3 Major Ports of India and New Port Projects under development36
2.3 The Government of India's Role in the Maritime Transport Sector ....... 38
2.4 Sagarmala: Port led Development .......................................................... 40
2.5 Types of transhipment and their operation ........................................... 42
2.6 Framework for a Transhipment Hub ...................................................... 43
2.7 Summary of the Chapter......................................................................... 44
3 METHODOLOGY .............................................................................................. 45
3.1 Introduction ............................................................................................ 45
3.2 Multi-case study analysis ........................................................................ 46
3.3 SWOT analysis ......................................................................................... 46
3.3.1 Advantages of SWOT analysis ..................................................... 48
3.3.2 Limitations of SWOT analysis ...................................................... 49
3.4 Summary of the Chapter......................................................................... 49
4 ANALYSIS OF INDIAN PORTS ........................................................................... 50
4.1 Introduction ............................................................................................ 50
4.2 Motives for Establishing an Indian Transhipment Hub .......................... 55
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4.3 West Coast Ports ..................................................................................... 56

4.3.1 JNPT Port ..................................................................................... 57
4.3.2 Mumbai Port ............................................................................... 59
4.3.3 Kochi Port .................................................................................... 60
4.4 East Coast ................................................................................................ 62
4.4.1 Chennai Port................................................................................ 63
4.4.2 Tuticorin Port .............................................................................. 65
4.4.3 Vishakhapatnam Port .................................................................. 67
4.5 Upcoming Port Projects .......................................................................... 69
4.5.1 Vizhinjam Port ............................................................................. 69
4.5.2 Colachel Port ............................................................................... 73
4.6 Summary of the Chapter......................................................................... 75
5 CONCLUSION .................................................................................................. 77
5.1 Limitations of this research study ........................................................... 79
5.2 Suggestions for future research.............................................................. 80
6 REFERENCES.................................................................................................... 82
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LIST OF TABLES

Table 1. Growing Economics GDP forecast for 2030 ……………….……………………34

Table 2. Top 15 Countries’ Container port traffic……………….……….……...………..35

Table 3. Outlay and Expenditure for the Ports and Shipping Sector…….………..39

Table 4. Objectives of Sagarmala Project…………………………………………..............40

Table 5. Components of Sagarmala Project……………………………….………...……….40

Table 6. Projects under Sagarmala ……………………..…………………………................41

Table 7. SWOT characteristics………………………………………………………….….………..46

Table 8. SWOT analysis in-context of a Port……………………………………….............47

Table 9. Trends in Cargo Handled at Major & Non-Major Ports …………………….50

Table 10. Indian Ports throughput and T/S Incidence……………………..................52

Table 11. Indian Container Transhipment volume % by foreign hubs…….……….54

Table 12. Major Ports in India………………………….…………………………….….…...........55

Table 13. JNPT Port Features Part 1…………………………………………………….………….56

Table 14. JNPT Port Features Part 2………………………………………………………………..56

Table 15. JNPT Port SWOT Analysis………………………………………………….................57

Table 16. MBPT Port SWOT Analysis…………………………………….………………………….59

Table 17. ICTT Port Features Part 1……………………………………………….…………………59

Table 18. ICTT Port Features Part 2…………………………………………….….………………..59

Table 19. Kochi Port SWOT Analysis…………………………………….………….……………….61

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Table 20. Chennai Terminals Features Part 1…………………………….….………… 62

Table 21. Chennai Terminals Features Part 2…………………………….….………… 62

Table 22. Chennai Port SWOT Analysis………………………………….………...……… 63

Table 23. Tuticorin Terminals Features Part 1………………………………............ 64

Table 24. Tuticorin Terminals Features Part 2……………………………….………... 64

Table 25. Tuticorin Port SWOT Analysis……………………………………………….…. 65

Table 26. Vishakhapatnam Terminals Features Part 1………………………...…. 66

Table 27. Vishakhapatnam Terminals Features Part 2………………………….... 66

Table 28. Vishakhapatnam Port SWOT Analysis………………………………………. 67

Table 29. Vizhinjam Port Features Phase 1………………………………….……….…. 69

Table 30. Traffic Forecast Vizhinjam in 3 phases………………………………………. 70

Table 31. Vizhinjam Port SWOT Analysis…………………………………….……………. 71

Table 32. Colachel Port SWOT Analysis……………………………………………………… 73

Table 33. Major India Ports region-wise………………………….……………….……. 74

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LIST OF FIGURES

Figure 1. Link concept in Container network ………………………………………….. 17

Figure 2. The world's top 50 container ports by degree, 2020……………..…. 27

Figure 3. The world's top 50 container ports by betweenness, 2020…….... 27

Figure 4. Correlation between ports’ betweenness and degree, 2020….... 29

Figure 5. World merchandise trade volume and GDP growth ………………… 31

Figure 6. GDP of Top 10 Economies……………………………………….……………….. 33

Figure 7. 12 major Ports in India……………………………………………………..…….…. 36

Figure 8. Port wise share of cargo handled……………………………………..……….. 37

Figure 9. Ports and Transhipment Incidence………………………………………...... 42

Figure 10. Share of overseas cargo traffic at major ports during…………….… 50

Figure 11. Indian Container Transhipment Hubs-Indian & Foreign………….. 53

Figure 12. Vizhinjam port location vs. Colombo Shipping route ………..……. 70

Figure 13. Location of Colachel……………………………………………………………..... 72

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LIST OF ABBREVIATIONS

3 PL- Third Party Logistics

AICT- Adani International Container Terminal

APM- AP Moeller Terminals

BCG- Boston Consulting Group

BMCT- Bharat Mumbai Container Terminal

CAGR- Compound Annual Growth Rate

DPW- Dubai Ports World

ECR- Empty Container Repositioning

EEPC- Engineering Export Promotion Council

EODB- Ease of Doing Business

EODB- Ease of Doing Business

FCL- Full Container Load

FDI- Foreign Direct Investment

FMCG- Fast Moving Consumer Goods

GDP- Gross Domestic Product

GPI- Global Performance Indicators

GST- Goods and Service Tax

GTI- Gateway Terminals India

ICTT- International Container transhipment Terminal

IIFT- Indian Institute of Foreign Trade

ITF- International Transport Federation

JNPT- Jawaharlal Nehru Port Trust

KPCT- Krishnapatanam Port Container Terminal

LCL- Less than Container Loads

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LPI- Logistics Performance index

MOS- Ministry of Shipping

MRO- Maintenance, Repair and Operations

NSICT- Nhava Sheva International Container Terminal

NSIGT- Nhava Sheva India Gateway Terminal

PLSCI- Port Liner shipping connectivity index

PSA- Port of Singapore Authority

PTP- Pure transhipment Port

ROFR- Right of First Refusal

RORO- Roll On - Roll Off

SWIFT- Single Window Interface for Trade

SWOT- Strength Weakness Opportunity and Threat analysis

T/S- Transhipment

TCE- Transaction Cost Economics

TEU- Twenty Equivalent Units

TIES- Trade Infrastructure for Export Scheme

UNCTAD- The United Nations Conference on Trade and Development

WECG- World Economic Centre of Gravity

WTO- World Trade Organization

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1 INTRODUCTION

Considering its long coastline and favourable location, the potential development of
Indian seaports and container transhipment hubs is an essential part of India's mar-
itime strategy. The rising popularity of containerization in international trade points
out the necessity for effective transhipment hubs. India presents a strong oppor-
tunity in this field due to its advantageous geographic location. To realize India's full
potential, however, issues like insufficient facilities, paperwork, and competition
from well-established centre’s must be resolved.

The government's commitment to promoting the development of maritime infra-

structure can be seen by programs like Sagarmala and Bharatmala, which look for to
modernize ports and increase connectivity. In addition, new developments like the
expansion of megaships, digital transformation, and environmental concerns high-
light how important it is to adjust to changing global trade dynamics.

Public-private partnerships (PPPs) are a vital means of working together with the pri-
vate sector to promote investment, innovation, and efficiency in port operations. By
taking advantage of these partnerships, India can improve its marine environment
and draw in capital from abroad, advancing its goals for economic growth.

India can become a major player in international trade networks and propel eco-
nomic growth through the development of its seaports and container transhipment
hubs. Realizing this vision will require conquering challenges, making the most of
government initiatives, adjusting to new trends, and promoting collaboration with
the private sector.
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1.1 Background

Many nations, particularly those with robust export-oriented economies, owe much
of their economic growth to the maritime sector. It links isolated and remote com-
munities to the outside world and is an essential means of transportation for both
people and goods. It is a critical component of the global transportation network.

By itself, freight rates generate $380 billion in economic value annually for the world,
making up almost 90% of all international trade. The industry functions as a pillar
because it brings together different players in the global supply chain. It can encour-
age economic growth, result in the creation of jobs, and improve living standards
across the board. Events in this sector therefore have a big impact on the global
economy. It boosts economic activity and employment in the port and shipping sec-
tors. It also has a big impact on the economy of a lot of island and coastal countries.
Moreover, coast guards and navigators use ships all over the world to protect na-
tional territorial waters and international trade routes.

To safeguard the environment and the oceans, it is accountable for, among other
things, removing marine debris and responding to oil spills. It is the most environ-
mentally friendly shipping method as it produces the least amount of CO2 per weight
per distance travelled when compared to other forms of transportation. Even out-
side of the global economy, the shipping industry has a big impact on daily life. The
food we eat, the clothes we wear, and the electronics we use are just a few examples
of the many items we use and consume and how frequently they are shipped from
producer to consumer.

Marine activities may additionally impact economic structures; the most recent in-
stance of this was the disruption of international supply chains caused by the closure
of the Suez Canal in 2021. The International Monetary Fund makes it very clear that
shipping has a big influence on prices and inflation around the world. When freight
rates double, the economies of the respective nations are affected by inflation. The
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construction of a new ship can run into the millions, making the shipping sector in-
herently capital-intensive. Because investments in the marine financing sector can
easily reach millions, it is not a good fit for small investors and should only be pursued
by those with a high-risk tolerance. Capital flow inefficiencies further limit the ad-
vantages of low-risk investments for investors. These are only a few of the difficulties
the maritime industry faces. But as block chain technology develops and gains trac-
tion, these challenges are being addressed.

The maritime sector boosts economies all around the world. For some countries, this
industry is the backbone of their economic growth and development. The United
Nations Conference on Trade and Development (UNCTAD) projects that the value of
international maritime trade will have increased by approximately 3.4% by the end
of a five-year period that ends in 2024.

Various research articles have demonstrated the importance of maritime transpor-

tation to the global economy. The increasing significance of maritime transportation
as a catalyst for economic expansion is directly correlated with the growing demand
for this economical form of international freight transportation. It should be noted,
though, that this utility has a disadvantage in that it takes longer to use than other
modes of transportation.

International maritime supply chains are used to transport most goods and services
from their point of origin, either directly or indirectly. When something is moved
"indirectly," it usually refers to the shipping of replacement parts or raw materials by
sea. Without maritime commerce or other inexpensive modes of transportation, the
bulk of consumer goods would be unaffordable for final consumers. Similarly, the
costs of certain services will also go up if their raw materials or equipment needs to
be flown in.

Ocean transportation is essential to the expansion of the world economy, but it is

frequently disregarded. Through supply chains, it intricately links key industries like
manufacturing, agriculture, and mining. However, scepticism about investments in
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ports and maritime infrastructure stems from a lack of knowledge among the general
public and decision-makers. Professionals who are not from the maritime industry
frequently underestimate how important maritime transportation is to a nation's
economic growth. The industry's significance is further obscured by the fact that the
inland portion is more visible. The World Economic Centre of Gravity has shifted to-
wards Asia as a result of the region's booming economies, indicating the significant
influence of ocean trade on the concentration of economic activity.

Asia's competitive advantage in cheaper shipping of goods is the reason for its dom-
inance in container ports, with nine of the ten busiest ports situated there. This ben-
efit depends on having developed transportation systems. Making informed deci-
sions and appreciating the critical role that maritime transportation plays in promot-
ing economic development require an understanding of this importance.

When comparing coastal and landlocked nations, ports are clearly important to eco-
nomic development. Landlocked countries grow at a slower rate because they trade
30% less, mainly because of transportation issues getting to coastal ports. For land-
locked regions, maritime transport provides unmatched cost-effectiveness, connec-
tivity, and flexibility that cannot be replaced by other means such as air or land-based
transport. Operating ports provide major economic benefits to coastal nations by
drawing both domestic and foreign investment and strengthening the national econ-
omy.

Research indicates that the transportation of goods by sea has a significant and fa-
vourable effect on the economies of countries, prompting significant investments in
port and maritime infrastructure. In addition to promoting economic expansion, a
successful maritime strategy also improves national logistics performance, trade, ag-
glomeration, competition, and supply chain integration, all of which contribute to
general prosperity and development.

The management and development of ports are essential to a nation's maritime

competitiveness. Even though some countries are endowed with naturally deep
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ports, successful governance is just as important. Key performance indicators that

represent not only throughput but also customer satisfaction and different opera-
tional aspects are port efficiency, effectiveness, and resilience. Success in the mari-
time industry at the national and regional levels depends on a sound maritime policy
and strategic port management. Ports customize their offerings according to future
market positioning and trade trends. While some give priority to processing plants
and industrial clusters, others concentrate on liquid bulk trade with refineries and
storage facilities. This strategic decision-making is in line with the trade and eco-
nomic objectives of a nation.

Similar to land transportation, maritime transportation specializes in different types

of cargo, with carriers of containers, crude oil, and other goods fulfilling particular
market needs. Transport is optimized through specialization, which lowers expenses
and increases value for consumers. This specialized approach is required due to the
diverse nature of suppliers, transporters, and buyers, which promotes efficiency and
competitiveness in the maritime industry. In general, port success and strengthening
a nation's standing in the international maritime industry depend heavily on efficient
governance, strategic planning, and specialization.

Containerisation transformed maritime trade by reducing the need for manual la-
bour, realising economies of scale, and standardising procedures. Despite making up
only 12% of the maritime fleet, containers handle about 70% of the value of interna-
tional trade. This emphasises how important they are. Between the 1980s and the
2000s, container throughput rose quickly, reaching a peak of over 802 million TEUs
in 2019. Conversely, the COVID-19 pandemic caused a brief decline in growth, similar
to the financial crisis of 2008–2009. The amount of container traffic rose to 849 mil-
lion TEUs in 2021 as a result of stimulus packages. The container throughput did,
however, reach roughly 866 million TEUs in 2022, which was the lowest positive
growth rate in over 40 years. Globalisation and the widespread use of containers in
international trade are the primary drivers of this growth. Container throughput has
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been increasing steadily, as per Martin Placek's study, underscoring its vital function
in fostering global trade.

Container ports serve a wide range of clientele, including auto dealers, clothing man-
ufacturers, and retailers of fast-moving consumer goods. High-volume clients gain
from warehouses and processing facilities being close to ports, and third-party logis-
tics companies purposefully place warehouses close to ports or special economic
zones to facilitate effective logistics operations and promote economic activity. Be-
cause it is so inexpensive and plays such a crucial part in facilitating globalisation,
container transportation is still essential even in the face of disadvantages like envi-
ronmental contamination and security threats.

Door-to-door logistics services are provided by container shipping, which involves a

number of parties including shippers, freight forwarders, shipping lines, port opera-
tors, and inland carriers. The industry's importance is demonstrated by the fact that
it transports more than 70% of global trade in terms of value, with container ships
handling more than 50% of this value. A number of important parties work together
in the container shipping supply chain to guarantee the efficient transportation of
goods from point of origin to point of destination. This intricate network emphasises
how important container shipping is to supply chain management and international
trade.

Five main value-adding segments make up the Container Shipping Supply Chain
(CSSC): Inland transport & depot management, Seaborne transport, Port and termi-
nal management, Shipment arrangement, and Container management. These cate-
gories correspond to freight logistics, container logistics, vessel logistics, port/termi-
nal logistics, and inland transport logistics from the standpoint of logistics manage-
ment. The planning, scheduling, and routing of cargo and containerised shipments
are all part of freight logistics. The planning and management of the container fleet
is the main goal of container logistics in order to maximise fleet utilisation and satisfy
customer demands. Planning and managing the fleet of container ships is necessary
for vessel logistics to ensure dependable shipping services are delivered at the lowest
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possible cost. In order to facilitate truck, train, and vessel operations, port and ter-
minal logistics are concentrated on managing and storing containers at ports in an
efficient manner. Containers are transported, stored, and maintained within the in-
land region through the management of inland vehicle fleets and facilities by inland
transport logistics.

Many parties working to promote regional trade facilitation and economic growth
are involved in container transport. The procedure entails booking empty containers,
having them transported by truckers or third-party logistics (3PL) providers, filing
customs forms, processing exports, having them inspected by customs, scheduling
container routes, and loading the vessel. At the destination port, the procedure is
repeated in reverse, taking longer because of paperwork, customs clearance, and
inspections. Because containers may be offloaded at a hub port and then trans-
ported later by feeder vessels, transhipment introduces complexity.

The container liner industry's efforts to enhance their network and lower costs
through economies of scale gave rise to the concepts of transhipment and hubs. The
stages or links in container transportation that are indicated in Figure 1 have the
potential to become choke points in the maritime supply chain. A nation's ideal mar-
itime supply chain policy can adapt to these setbacks or offer solutions. In these kinds
of situations, the government's role in facilitating trade and national logistics perfor-
mance measures like the Logistics Performance Index (LPI) and Ease of Doing Busi-
ness (EODB) are more important.
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Figure 1. Link concept in Container network

(Shipping and Logistics Management, 2010)

1.2 Indian Shipping Sector

There is evidence of maritime trade connections between Mesopotamia and the In-
dus Valley Civilization, which dates India's maritime history back to 3000 BCE. Signif-
icant maritime activity is revealed by the excavations at Mohenjo-Daro and Harappa,
including the discovery of a dry dock at Lothal that dates to 2400 BCE. Since iron was
not yet in use, these ships were made of teak and propelled by big oars. Sea travel
and ships are mentioned in the Rig Veda and epics like the Ramayana and Mahabha-
rata.

Vast maritime trade activities flourished during the Mauryan period (500–200 BCE),
when Chandragupta Maurya established a naval force and Chanakya detailed naval
administration in his Arthashastra. During the reign of Ashoka, the Great, Buddhism
was introduced to Southeast Asia and extensive maritime exploration took place.

The Deccan was ruled by the Satavahanas (200 BCE–220 CE), who also promoted
trade with the Roman Empire. Astronomical advances, cultural growth, and eco-
nomic prosperity were all promoted during the Gupta dynasty (320–500 CE). During
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this period, Aryabhata and Varahamihira made important advancements in celestial

navigation.

Southeast Asian Hinduism and Indian culture were introduced by southern dynasties
such as the Cholas, Cheras, and Pandyas, who controlled the maritime trade. Alt-
hough conflicts reduced their power, the Sri Vijaya Empire was important to trade
expeditions and cultural exchanges. Beginning in the eighth century CE, Arab traders-
controlled trade routes and served as middlemen between the East and the West
when they arrived in India. Southeast Asia's maritime commerce entered its Early
Age during this time.

Existing trade patterns were upset by the advent of Europeans, beginning with the
Portuguese under Vasco da Gama in 1498. Key ports came under Portuguese author-
ity, and they fought local leaders like the Zamorins of Calicut. To challenge Portu-
guese dominance, the Dutch and French also established trading posts in India.

In 1600, the British East India Company set out to build trade ties with the Mughal
Empire by travelling to India. As British naval power increased, the British Raj was
established. The Marathas opposed British coastal expansion, and Shivaji was the
forerunner of a potent naval defence policy.

Following the country's independence, the Indian Navy was established, and in 1958
Vice Admiral R D Katari became the nation's first Indian Chief of Staff. The Royal In-
dian Navy, which was split between India and Pakistan in 1950 following their inde-
pendence, is where the Indian Navy got its start.
In conclusion, thousands of years of trade, cross-cultural interactions, and naval con-
flict have shaped India's rich and varied maritime history. Maritime trade has shaped
India's identity and relations with the rest of the world since the dawn of civilization.
With a coastline spanning 7517 km and 13 major and 205 minor ports, India's mari-
time history has been defined by its strategic coastline and thriving ports, which have
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historically drawn traders from both the east and the west (Indian Ministry of Ship-
ping, 2023). Significant changes did occur, though, during the colonial era, as British
and other colonial powers developed and used Indian ports like Mumbai, Calcutta
(Kolkata), and Madras (now Chennai) for trade purposes.

Following its independence, India worked to create port authorities and regulatory
bodies to oversee its maritime transport operations under the Ministry of Shipping.
The effectiveness of maritime transportation in India is hampered by a number of
issues despite these efforts, especially in the container industry.

To determine the viability and extent of establishing a transhipment hub in India,

research is being done. This entails assessing public policies and private sector par-
ticipation for their efficacy in advancing transhipment activities.

The objective is to create cutting-edge transhipment facilities that can meet the ris-
ing demand for containerised cargo movement by taking advantage of India's advan-
tageous location and extensive coastline. India hopes to become more competitive
in the world of maritime trade by addressing infrastructure deficiencies and enacting
supportive policies.

1.3 Purpose of this research

This study aims to investigate transhipment hubs in India and determine whether
there is potential for the establishment of a competitive hub or hubs for container
transhipment in India, as well as their positioning and connectivity. It seeks to deter-
mine whether the 12 largest Indian ports have the capacity to boost throughput by
focusing on transhipment. The purpose of this study is also to determine whether
these transhipment hubs have the capacity to reclaim the transhipment volumes
that are shipped from Colombo and other nearby hubs, thereby minimising reliance
on those nations for international goods shipping. It also seeks to determine whether
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market position and competitiveness in the maritime container transportation in-

dustry, specifically transhipment, can be enhanced by initiatives from the Ministry of
Shipping and regional port authorities. This includes an analysis of the Indian Ministry
of Shipping's initiatives, such as Sagarmala and the repeal of the captivity law, as well
as their scope and potential effects on transhipment hubs. Lastly, studies are done
on the effects of India's current lack of a transhipment hub port.

1.4 Research Questions

The thesis's primary research question is listed below:

Does Top Ports in India have the potential to develop into a major hub for the tran-
shipment of containers in the region? Questions to further analyse the topic are in-
cluded below to support the above question and for in-depth research.

1) What prerequisites would this change require, and what steps would be neces-
sary?

Here, the potential of Indian ports is compared with the main requirements for a
transhipment hub. This section examines the action plan that is necessary for these
ports to develop into significant transhipment hubs. In order to give the container
liner industry enough of an advantage over ports like Singapore and Colombo, the
government and other relevant authorities are primarily responsible for this action.
When considering operations and profitability, will these transhipment hubs in-
crease traffic and attract more business in the future, or will they not turn a profit?

2) Which port or ports, and in which regions, will serve as the primary hub?

Which of the 12 major ports and future port projects has the potential to be a tran-
shipment hub is the question this seeks to answer?
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3) How important are the ports' locations and connections?

The geographical positioning and connectivity of a container terminal, especially a

transhipment hub, are two of its main components. A transhipment hub's ability to
offer affordable services is a prerequisite for success, and proximity to important
trade routes is another crucial factor. In this case, the optimal transhipment hubs'
positioning and connectivity along the maritime route are taken into account to eval-
uate whether container liner businesses should choose these hubs over the current
major hubs, such as Colombo.

4) Can India survive without a major transhipment port?

Most of India's major ports are gateway ports, though some are mixed ports. Repu-
table transhipment hubs need to charge less for their services, and Indian ports cur-
rently have higher port dues. This section asks whether India can continue to rely on
foreign ports like Colombo for its transhipment transporting, taking into account the
cost of doing business and potential shipping trends.

1.5 Research Methodology

A comprehensive approach is used in the research methodology to examine the pos-

sible growth of Indian seaports as hubs for container transhipment. It includes a re-
view of relevant literature, data collection, case studies, statistical analysis, SWOT
analysis, stakeholder analysis, comparative analysis, and scenario planning.

The basis is the literature review, which examines the body of knowledge regarding
container transhipment hubs around the world. This entails a thorough analysis of
effective models, port development tactics, and logistical factors. It offers insights
into the elements that contribute to transhipment hub success and aids in the estab-
lishment of a theoretical framework.
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A crucial component is data collection, which uses both quantitative and qualitative
techniques. Quantitative information looks at the capacities, effectiveness, and tran-
shipments volumes of Indian seaports as of right now. Interviews with stakeholders,
port authorities, and industry experts are used to collect qualitative data. This two-
pronged strategy guarantees a thorough comprehension of the current situation.

Empirical analyses of prosperous transhipments hubs across the globe provide valu-
able perspectives. By analysing these cases, important success factors and obstacles
can be found, allowing lessons to be drawn that are relevant to the Indian context.
The objective is to comprehend the distinctive elements that lead to successful tran-
shipments operations and modify them for the Indian maritime environment. To
evaluate the advantages, disadvantages, opportunities, and threats connected to
each possible Indian seaport, a SWOT analysis is utilised. Using this strategic tool will
help you create well-informed strategies and recommendations. Stakeholders can
make better decisions if they have a better understanding of the internal and exter-
nal factors influencing port development.

In order to forecast future trends and evaluate the growth potential of container
transhipment in the Indian maritime industry, statistical analysis is applied to histor-
ical data. This quantitative method offers a data-driven viewpoint that is useful for
spotting trends, projecting future events, and calculating the relative contributions
of different factors. A SWOT analysis is used to assess the benefits, drawbacks, op-
portunities, and threats related to each potential seaport in India. Making use of this
strategic tool will enable you to formulate well-informed recommendations and
strategies. If stakeholders are more aware of the internal and external variables af-
fecting port development, they will be able to make better decisions.

Statistical analysis is used on past data to predict future trends and assess the growth
potential of container transhipment in the Indian maritime sector. This quantitative
approach provides a data-driven perspective that is helpful in identifying patterns,
forecasting future occurrences, and determining the relative contributions of various
factors. Creating future scenarios for the possible growth of Indian seaports as hubs
 23

for container transhipments is known as scenario planning. This approach helps

stakeholders anticipate possible obstacles and opportunities by taking into account
a variety of economic, political, and technological factors. This allows stakeholders
to develop flexible strategies.

Determining precise parameters for the research is necessary to guarantee its rele-
vance, feasibility, and focus. To keep the study from getting too wide, geographic
boundaries are used to define which Indian seaports will be included in the analysis.

The study's temporal scope is established by a specified timeframe that takes into
account past data and projects future developments over a fair amount of time. This
guarantees the research's continued relevance and applicability to the ever-changing
maritime sector.

The industry focus has been meticulously crafted to encompass pertinent facets of
the maritime and logistics domain, including supply chain considerations, port oper-
ations, and container shipping. The precision of the study ensures a targeted analysis
and keeps it from becoming overly generalised. In order to clearly identify elements
or variables that will not be examined in the study, exclusion criteria are developed.
This keeps the research from getting too complicated or overwhelming and helps to
keep it focused. It is critical to acknowledge resource constraints, including those
related to time, money, and data availability. Transparency is ensured and readers
are assisted in understanding the study's conclusions in light of these limitations by
having these limitations openly addressed.

A thorough and methodical approach is used in the research methodology, and de-
limitation guarantees relevance, clarity, and focus. These components work together
to provide a thorough analysis of the possible growth of Indian seaports as hubs for
the transhipment of containers.
 24

1.6 Thesis Structure

This research study consists of five chapters, and the structure follows as:

The importance of transhipment hubs and container transportation to economies is

discussed in Chapter 1, along with the role played by governments in formulating the
best maritime transportation laws to enhance economic performance. This served
as the foundation for the formulation of the research questions and sub-research
questions within the Indian context.

In-depth literature review on the relationship between the shipping sector's growth
and the economy's expansion is provided in Chapter 2, along with an explanation of
how higher global performance indicators and logistics can draw liner business, es-
pecially from India. A review of government of India initiatives and their contribution
to regional transhipment market competitiveness is also included. Next, a matrix of
literature reviews is created by analysing 16 studies pertaining to the features of
transhipment hubs. This leads to the ranking of essential transhipment hub attrib-
utes, which is then applied to significant Indian ports.

The characteristics, benefits, and drawbacks of SWOT analysis are covered in Chapter
3, along with an explanation of how to apply it to ports.

In Chapter 4, two new port development projects as well as a multi-case study and
SWOT analysis are applied to ports in Western and Eastern India. This chapter con-
cludes by identifying the potential transhipment hubs in the East and West region as
well as the New Port Project. It does this by analysing the Strengths, Weaknesses,
Opportunities, and Threats of the Eight Ports.

Chapter 5 presents the study's limitations, conclusion, and discussion of the need for
additional research in this field.
 25

2 LITERATURE REVIEW

Container shipping accounts for about 17% of all seaborne trade worldwide
(UNCTAD, 2018). With a projected CAGR of 4.5%, the total container market was
valued at $ 8.7 billion in 2017 and is projected to reach $12 billion by 2023 (Allied
Market Research, 2017). A review of the literature is required because the research
area focuses on the transhipment hub in India and is primarily related to the con-
tainer liner industry and government organisations. This includes research studies,
journals, and articles in the port, maritime transport, and related fields. A literature
review aids in both gaining a thorough understanding of a previously studied subject
and the research methodology used in the investigation.

Only when the significance of ocean trade, trade facilitation, and the reasons behind
the establishment of hub and spoke operations are recognised can the value of a
transhipment hub for a nation be fully appreciated.

2.1 Overview of Global Container Liner network

The global container liner network is indispensable for international trade, linking
producers and consumers worldwide. Transhipment, transferring containers be-
tween vessels at hubs, is vital for efficiency. It enhances connectivity, enabling
smaller ports to access global markets and allowing for economies of scale with
larger vessels. Transhipment offers adaptability to market changes and expedites lo-
gistics processes, benefiting international trade. Moreover, it attracts investment,
fostering regional economic growth. Ultimately, transhipment hubs are pivotal
nodes in the container liner network, ensuring smooth cargo transfers, trade facili-
tation, and economic stimulation.

There were 939 container ports worldwide that regularly received liner shipping ser-
vices as of the second quarter of 2020. There would be 440,391 direct liner shipping
connections if every port offered direct services to every other port. However, in
practice, just 12,748 port pairs—or 2.9% of the total—have these direct connections.
 26

Containers must be transhipped in other ports in order to facilitate trade between

the remaining 97.1 percent of port pairs. For a single trade transaction, the least
connected port pairs need up to six transhipments, seven direct port-to-port ser-
vices, and fourteen port moves.

We review the features of the liner shipping network using data that MDS Trans
modal has made available to UNCTAD.

Ports are the hubs of the shipping system. Two metrics are used to characterise a
port's position within the shipping network:

• The node degree: The number of other ports with which the port has a direct
connection.

• The node betweenness: How important is a port for trade between other
ports that connect with each-other via transhipment.

The top 50 ports are ranked by "degree" in Figure 2 (all data for the second quarters
of each year are shown), and the top 50 ports are ranked by "betweenness" in Figure
3 The correlation between the two measures, "betweenness" and "degree," is shown
in Figure 4
 27

Figure 2. The World’s top 50 container ports by degree (UNCTAD, 2020)

Figure 3. The World's top 50 container ports by betweenness

(UNCTAD, 2020)
 28

Shanghai leads the pack in terms of port connectivity in 2020 with 288 direct con-
nections, followed by Busan (274 direct connections), Rotterdam (264), and Antwerp
(268). This ranking is based on the "degree" metric. According to this criterion, Car-
tagena in South America has the most connections (130 direct connections), while
Tanger Med in Africa has the highest degree (137 direct connections) (Figure 2).The
"betweenness," or the number of port-to-port connections for which a port is among
the best choices in terms of reducing the number of required transhipments, is dis-
played in Figure 3.

In 2020, there are 42,656 port-to-port connections that include Rotterdam on their
optimal routes. Rotterdam is the port with the highest betweenness. Stated differ-
ently, Rotterdam is included as a transhipment port for 9.7% of optimal routes out
of the total global 440,391 port-to-port connections. Antwerp and Hamburg have
been calculated to have the second and third highest betweenness.

Asian ports have better connectivity under the criterion of "degree," but major Eu-
ropean ports have better connectivity under the criterion of "betweenness." There
are not many direct connections at some of the ports with a high betweenness. As
seen in the figure 4 below, they may be the ports most ideally situated to connect
other ports through because of their central location within their region.
 29

Figure 4. Correlation between ports’ betweenness and degree

(UNCTAD, 2020)

What has changed in the last 14 years?

Between the 2nd quarter of 2006 and the 2nd quarter of 2020 the following changes
in the network can be observed:

1. From 834 to 939, the number of container ports in the network has grown by
13%. During the same period, the average node betweenness increased by
27%, which was indicative of both the decline in direct port-to-port services
and the expansion of the network.

2. Asia now occupies the centre of the network, moving from Europe in terms
of both position and largest nodes. Three Chinese ports—Nansha, Ningbo,
and Shekou—are the ones that have improved their degree the most, while
three ports in the UK—Tilbury and Felixstowe—and Venezuela—Puerto Ca-
bello—saw the biggest declines in their degree.
 30

3. There is a trend towards more connections utilising transhipment services, as

evidenced by the decline in the percentage of port pairs that rely on direct
services from 3.7% in 2006 to 2.9% in 2020. In the same time frame, the av-
erage degree fell by 10%.

At 2.7 companies, the average number of service providers per port pair did not
change.

2.2 Role of Container transport and Ports in the country’s economy

Ports, handling over 80% of global sea trade, are vital for economic growth, especially
for exports. Efficient port infrastructure attracts investment, generates jobs, and
boosts income levels. However, inefficient ports hinder trade expansion, particularly
for Small Island Developing States (SIDS) and Landlocked Developing Countries
(LLDCs), leading to higher costs and supply chain disruptions. The Container Ports
Performance Index (CPPI) tracks global port efficiency, highlighting room for im-
provement through digitization and infrastructure development. Effective port op-
erations lower trade costs, enhance food security, and reduce emissions. Nations
must develop competitive port ecosystems with logistics parks and special economic
zones to foster trade facilitation and economic welfare.

Trade volume and GDP growth

In Q4 2022, there was a significant slowdown in global trade and economic output
due to tighter monetary policies in major economies. Challenges in China's real es-
tate sector and persistent inflation in the US and EU shattered hopes for a speedy
recovery. The outlook for trade in 2023 and 2024 is further complicated by the
COVID-19 aftershocks and the conflict in Ukraine. In contrast to previous projections,
the WTO projects a modest 0.8% growth in global merchandise trade for 2023. It is
anticipated that real GDP will grow by 2.6% in 2023 and 2.5% in 2024. In 2023, trade
 31

growth is expected to surpass GDP growth, but in 2024, it is expected to lag behind.
These variations are accepted as normal and are influenced by things like investment
and durable goods.

World merchandise trade volume and GDP growth, 2021-2024

Figure 5. World merchandise trade volume and GDP growth

(WTO, 2023)

What is a container terminal?

The primary purpose of a container terminal is to facilitate the movement of cargo

and shipping containers between ships and other types of transportation, like trucks
and trains. Additionally, terminals serve as checkpoints for ship inspections, loading,
and unloading. It's possible that you've heard "container port" and "container termi-
nal" used synonymously. Ports and terminals are not the same thing, though. Now
let's examine the differences.
 32

Role of container terminals in the shipping process

As was already mentioned, a terminal's primary function is to link ships and other
maritime transportation to other forms of transportation like trucks, trains, and
barges. Terminals serve as a point of entry into other nations. They serve as a crucial
distribution hub and allow end users to ship cargo. Goods can be transported to their
final location by road, rail, and canals from this node.

2.2.1 Performance of Maritime Transport and the Indian Economy

It is possible to analyse several performance factors to determine a country's stand-

ing in the shipping industry:

• Port and associated infrastructure (dimensions, quality, speed, and capacity

utilisation).
• National Ship Fleet (Age, Volume, Size and Share of National Flagships).
• Trade Profile (GDP size, CAGR, and trade percentage against GDP).
• Trade facilitation (efficiency of laws and policies, EODB, and LPI).
• Service providers (port services, government services, 4PL cost and perfor-
mance).
• Rivals (trade sectors, ports, terminal operators).

These variables can be correlated and cross-examined with the shipping industry's
actual performance. The government's role in trade facilitation is a significant factor
in determining the potential of the Indian shipping market, in addition to infrastruc-
ture, economic size, and shipping performance.

India has the fifth-largest economy in the world (IMF, 2023) but its shipping sector
fleet size is much smaller (2%) than the global fleet size, placing it only 16th out of
35 countries in the world (UNCTAD). India has a 3.7 trillion-dollar economy, with im-
ports and exports making up 26.44% and 22.79% of GDP, respectively. Additionally,
 33

according to The World Bank (2022), India ranks ninth in the world for total imports
(732 billion dollars) and tenth for total exports (770 billion dollars). Maritime
transport accounts for 68% of India's value-based trade and 95% of its volume-based
trade (Indian Ministry of Ports, Shipping & Waterways, 2023).

Figure 6. GDP of Top 10 Economies

(The World Bank, 2023).

With a GDP of $26,954 billion, the US leads the world economy and is fuelled by a
variety of industries including manufacturing, services, banking, and technology.
With an economy worth $17,786 billion, China comes in second, mainly dependent
on exports, manufacturing, and government assistance. Known for its precision en-
gineering, Japan's $4,231 billion economy is booming in manufacturing, services, and
technology, while Germany's $4,430 billion economy is in slight decline. With an
economy worth $3,730 billion, India is ranked fifth and is experiencing rapid growth
in manufacturing, services, technology, and agriculture. With GDPs ranging from $2
to $3 trillion and diverse industries, the UK, France, Italy, Brazil, and Canada are some
other significant economies.

SR NO COUNTRIES NAME CURRENT GDP 2023 GDP FORCAST 2030

1 CHINA $32.9 Trillion $47.38 Trillion

2 UNITED STATES $26.95 Trillion $33.96 Trillion

 34

3 INDIA $13.12 Trillion $22.20 Trillion

4 JAPAN $6.5 Trillion $7.47 Trillion
5 INDONESIA $4.39 Trillion $6.80 Trillion
6 GERMANY $5.54 Trillion $6.73 Trillion
7 RUSSIA $5.06 Trillion $5.97 Trillion
8 BRAIL $4.1 Trillion $5.15 Trillion
9 TURKEY $3.61 Trillion $4.96 Trillion
10 UNITED KINGDOM $3.87 Trillion $4.77 Trillion

Table 1. Growing Economics according to the IMF’s GDP forecast for 2030
(Insider Monkey, 2023)

Trade and economic growth are interdependent, as was indicated in the previous
section. It would make sense to compare the GDP data with container throughput as
the main focus of this research is container trade. India ranks ninth in the world in
terms of total global container throughput, as shown in table 2 below. Nevertheless,
just 2.23% of containers are processed overall. Given that India has a coastline of
7517 km and 14500 km of navigable waterways, along with 13 major and 205 minor
ports, this metric has room for improvement (Indian Ministry of Shipping, 2023).

Indicators name: Container Port traffic. (TEU: 20foot equivalent units) in Millions

% Of World Top 15
Country Name 2018 2019 2020 2021 Total %
China 224117874 234618700 243560000 246040000 30.99%
United States 50202917 53038852 54260121 52931790 6.94%
Singapore 33666600 36599200 37195000 36870900 4.65% 49.58%
Korea, Rep. 27420698 28874930 28959959 28834192 3.68%
Malaysia 23719787 24955994 26215322 26669483 3.32%
Japan 22795035 23424446 23276482 21556531 2.90%
Hong Kong SAR,
China 20760000 19641000 18360000 17953000 2.42%
United Arab 12.12%
Emirates 19089706 18433133 18802000 18721000 2.40%
India 15450523 16996593 17487621 17576860 2.23%
Spain 15929902 17165709 17464920 16745930 2.18%
 35

Viet Nam 12382524 13394390 15297028 16394723 1.94%

Netherlands 13992474 14802257 15198050 14757227 1.91%
Germany 15169595 15094593 15029605 13950977 1.89% 8.74%
Belgium 10783850 11503695 12389876 12697162 1.55%
Turkiye 10001342 10801305 11591414 11626578 1.45%
World Total 736222912 772578602 793504266 779556124 100% 70.44%

Table 2. Top 15 Countries’ Container port traffic

(The World Bank, 2021)

2.2.2 Importance of Transhipment Hubs

In order to facilitate the growth of liner businesses in India, the government needs
to make significant investments in seaport infrastructure and related fees, as well as
in developing the hinterland economy and feeder services. Considering that India is
among the top export markets in the world, a significant boost to the country's econ-
omy is necessary to draw in significant liner alliances. Within the transhipment net-
work, both pendulum service and hub-to-hub direct trade would be involved in this
predicted increase in traffic. Direct shipments from significant hubs to Indian tran-
shipment hubs would strengthen connectivity to the hinterland via rail or road in
addition to containers to be shipped as transhipment.

One of the main reasons shipping lines are drawn to the Indian subcontinent is the
increase in trade volumes. Apart from its advantageous location in the Strait of Ma-
lacca, Singapore's success as a transhipment hub was largely due to its industrious
port community and related infrastructure. Singapore's thriving status as a tranship-
ment port is reflected in its consistently high rankings in global performance indica-
tors. Growing trade stimulates infrastructure development for maritime transporta-
tion and creates a vibrant port community, which draws businesses looking for loca-
tions close to major economic hubs.
 36

Factors such as port location, nautical features, favourable legislation, and lower
costs are important in determining how competitive transhipment hubs are. Alt-
hough port location is fixed, reforms can address cost and legislation; therefore,
careful consideration must be given to the selection of coastal areas for port devel-
opment. Institutional design and strategic planning are essential for the successful
development of transhipment ports; government backing and early investments in
container terminals are also vital.

2.2.3 Major Ports of India and New Port Projects under development

Indian Port Act of 1908 stipulates that every major port must be directly supervised
by the Central government, as enforced by the Major Port Trust Act of 1963. Out of
about 200 Indian ports, Ennore Port is a corporation under the Indian Companies
Act, while 11 of the Major Ports are governed by Port Trusts under the Indian Port
Act 1908 and Major Port Trust Act 1963. Approximately two thirds of the nation's
cargo are handled by these ports.

Figure 7. 12 Major Ports in India

(Maps of India, 2019)
 37

India is to develop six major ports as part of the Sagarmala Project. Enayam Port, the
thirteenth proposed major port, is expected to be built in Colachel with an invest-
ment of USD 3.9 billion and is expected to become a major transhipment hub for
India (The Economic Times). Based in Vizhinjam, the Greenfield Port project is a state
government undertaking under the Landlord Model and is anticipated to play a ma-
jor role in the transhipment market.

Two of the primary characteristics of transhipment hubs are found in Vizhinjam: its
close proximity to the east-west trade lane and its deep draft of eighteen metres
(AECOM, 2012). Roughly 25% of container traffic is anticipated to be related with
transhipment, according to 2012 projections (timelines not met due to construction
delays) (AECOM, 2012).

Deendayal Port was the Major Port that handled the most cargo, totalling 137.56
million tonnes, accounting for 17.6% of the total. Other major ports that handled
cargo during April–March 2022–23 included Paradip Port (17.3%), JNPA (10.7%), Vi-
sakhapatnam Port (9.4%), Mumbai Port (8.1%), Chennai Port (6.2%), SMP Haldia
(6.2%), Kamarajar Port (5.6%), NMPA (5.3%), VOC Port (4.8%), Cochin Port (4.5%),
Mormugao Port (2.2%), and SMP Kolkata (2.1%).
 38

Figure 8. Port wise share of cargo handled

(Ministry of Port, Shipping & Waterways, 2023)

Paradip Port saw the largest increase in traffic handled at major ports between April
and March of 2022–2023, accounting for 16.6% of total traffic. SMP Haldia (13.4%),
Kamarajar (12.6%), VOC Port (11.1%), JNPA (10.4%), SMP Kolkata (9.6%), Deendayal
Port (7.7%), Visakhapatnam (6.8%), Mumbai Port (6.2%), NMPA (5.4%), Cochin Port
(2.0%), and Chennai Port (0.8%) were the next in line. Mormugao Port (6.2%) was
the only major port to record a decrease in traffic between April and March of 2022–
2023 compared to April and March of 2021–2022.

2.3 The Government of India's Role in the Maritime Transport Sector

A study on the Future of Container Trade predicts that India will play a leading role
in international trade and that East Asian offshoring will move to India (Mckinsey).
According to the report, India can achieve exceptional growth by investing in and
improving its infrastructure, transforming the market, lowering trade barriers, and
cutting costs, among other things (Mckinsey).
 39

The report predicts major disruptions and technological changes. India anticipates a
rise in maritime trade in the future, with 20% of that trade expected to be in con-
tainers (Indian Ministry of Shipping). However, the infrastructure in place is insuffi-
cient to handle this potential increase in trade flow, and potential bottlenecks such
as a lack of transportation or longer vessel dwell times may arise. In addition to
standard gateway functions, the most effective way to improve connectivity quality
and save costs. The main issue linked to the slow growth of transhipment is India's
cabotage laws.

Table 3 below lists the outlay and expenditure (in crores) for the Ports & Shipping
Sectors over the course of the various plan periods.

Ports Sector Shipping Sector

Five Year Plan
Outlay Expenditure Outlay Expenditure

I (1951-56) 37 28 26 19

II (1956-61) 45 33 48 53

III (1961–66) 86 93 57 40

Annual Plans (1966-69) 54 53 23 32

IV (1969-74) 195 249 141 155

V (1974-79) 571 488 450 469

(1980–85) 647 765 755 444

(1985–90) 1230 1513 827 720

(1992-97) 3557 2302 3669 3033

(1997-02) 10081 5316 6305 2466

(2002-07) 5418 2893 7754 2992

(2007-12) 30305 6905 15026 9788

(2012-17) 15764 11900.43 10142 4664

2017-18 4835 3768.91 1740 1982.68

 40

2018-19 5229 3776.35 1482 2139.12

2019-20 5717.64 2485.44 1762.7 1588.61

2020-21 3580.93 2447.27 1933.9 1592.91

2021-22 4984.62 3104.77 1535 1587.39

2022-23 4592.82 1540.21 1577 1138.15

2023-24 3896.37 n/a 1955.58 n/a

Table 3. Outlay and Expenditure for the Ports and Shipping Sector
(Annual Report of Ministry of Ports, Shipping & Waterways, 2022)

2.4 Sagarmala: Port led Development

The most important port-based development being undertaken by the current gov-
ernment is Sagarmala, one of several initiatives aimed at improving India's standing
in the world of maritime transportation. The first programme of its kind in the coun-
try, this one was unveiled in 2016 during Maritime Summit 16 (Indian Ministry of
Shipping, 2019a). The program's beneficiaries include the workforce at ports, the
people living in port-centric areas that may have CEZs (Commercial Economic Zones),
the logistics sector, and all other services that support the maritime industry (Vision
IAS). Goals for the project include the following for Sagarmala in diagram:

Concentration on increasing Intermodal options to reduce domestic freight

Reducing the Logistics price of bulk commodities by planning coastal industrial facilities

Bringing more investment in for port-centric industrial and logistics clusters

Reducing Container transports lead time for exporting and importing

Table 4. Objectives of Sagarmala Project

(Testbook, 2024)
 41

1. Transformation and Updating Current Ports and Building New Ports: Removing chokepoints
in Port supply chains, updating Capacity and quality of Port Infrastructure. Investment in New
Port and supporting infrastructure.

2. Improving Port Connectivity: Improving network both in Maritime and hinterland regions
including Inland and Coastal water transport.

3.Investing in Port centric logistics clusters: Focusing on port-centric logistics and attracting
investment from manufacturing and trading sectors in special economic zones and logistics
clusters

4.Coastal Community Development: Advancement of Coastal communities through education

and employment, enhancing access for local people to tap into the blue economy

Table 5. Components of Sagarmala Project

(Testbook, 2024)

Out of these first two components are crucial for transhipment hubs, Port Moderni-
zation/New Port Development, and Port Connectivity enhancement.

Table 6. Projects under Sagarmala

(Ministry of Ports, Shipping & Waterways, 2023)

One of the solutions from Origin to Destination Study by the Ministry of Shipping is
to have a transhipment hub with 10-12 million TEU (Indian Ministry of Shipping,
2016a).
 42

2.5 Types of transhipment and their operation

The maritime sector, in particular the container liner industry, is changing quickly to
keep up with the demands of international supply chains. The Hub and Spoke model
were adopted because the trend towards larger container vessels presents chal-
lenges for ports with shorter drafts. According to this model, mega vessels link to
hub ports, from which containers are discharged and dispersed via feeder vessels to
smaller ports, guaranteeing network connectivity.

This approach satisfies customer demands for faster access to smaller ports even
though it was not initially motivated by cost reduction. Transhipment is important;
it accounts for roughly 28% of the world's container throughput and is mostly done
through hub-and-spoke arrangements. In order to reflect their function in interna-
tional maritime networks, ports are grouped according to the frequency of tranship-
ment, ranging from gateway ports to pure transhipment hubs.

REGIONAL GATEWAY
GATEWAY
10%
25%

75%
90%
 43

HUB PORT PURE

TRANSHIPMENT
HUB 10%
50% 50%

T/S INCIDENCE
DIRECT ORIGIN DESTINATION 90%

Figure 9: Ports and Transhipment Incidence

(Terminal operations in container transhipment hubs, 2016)

Figure 9 illustrates that transhipments account for more than 90% of a Pure Tran-
shipment Hub's overall container throughput. Aside from the substantial infrastruc-
ture needed to handle mother ships and keep liners from moving to rival ports, one
of the primary requirements for a port to continue being a competitive pure tran-
shipment port is lower margins.

2.6 Framework for a Transhipment Hub

When liners select a transhipment hub, they prioritize several factors outlined in Ta-
ble 8-derived framework. Firstly, Location and Connectivity are paramount, ensuring
strategic positioning along trade routes and efficient connections with other ports.
Operational Costs and Port Charges are crucial, influencing profitability directly.
Quality of Port Features, including reliability and minimal delays, is a top priority for
liners to ensure smooth operations.

Infrastructure, encompassing modern facilities and IT integration, enhances opera-

tional efficiency. While Port Size and Volume are considered, they are not top prior-
ities but still influence liner decisions based on capacity and throughput. Hinterland
Connectivity, though significant, doesn't directly impact transhipment but can dis-
rupt operations. Liners also consider other factors like port management, but the six
 44

aforementioned elements are prioritized for their impact on cost-effectiveness and

operational efficiency. Overall, liner decisions hinge on positioning, operating costs,
port quality, feeder networks, infrastructure, and port size/volume to ensure optimal
hub selection.

2.7 Summary of the Chapter

A review of the literature on the Indian container and transhipment markets is pro-
vided in this chapter. By starting with the global container market and focusing on
the Indian container shipping industry, it becomes possible to see how Indian ports
could develop into transhipment hubs. The literature that included the transhipment
deciding factors for ports and liners was then examined and summarised in table 8,
which served as the foundation for ranking the crucial elements of a transhipment
hub. A framework was developed that will be employed in the analysis, based on the
two key sections of the reviewed literature mentioned above about the potential of
Indian ports to offer transhipment services and the ranked features of the deciding
factors for both Liner and Port in terms of Transhipment.
 45

3 METHODOLOGY

A variety of methods is used in the methodology to investigate the possible develop-

ment of seaports and hubs for container transhipment in India. It starts with an in-
depth review of international literature, exploring port development opportunities,
obstacles, and best practices. Following this, collecting data from reliable sources
offers quantitative insights into policy frameworks, container traffic, and port infra-
structure in India, which is supported by qualitative data on ongoing projects and
regulatory environments.

Case studies of successful port projects around the world offer valuable lessons that
are relevant to India's situation and help identify strategies that can be used else-
where. In order to inform strategic interventions, a SWOT analysis analyses both ex-
ternal and internal factors affecting the development of Indian ports. Policy analysis
looks at current laws and programs to help guide suggestions for promoting port ex-
pansion that is sustainable.

Future trends in container traffic and trade patterns are predicted using forecasting
models and scenario planning techniques, allowing for the development of proactive
strategies to deal with new problems. By means of this complete approach, inter-
ested parties acquire a refined understanding of the Indian maritime domain, which
aids in the creation of informed strategies for port growth and improving competi-
tiveness.

3.1 Introduction

This thesis's research design is described in this chapter. It explains the rationale be-
hind both the qualitative analysis technique and the multiple case study approach.
SWOT analysis was a popular technique for analysing the qualitative data. Since the
Indian ports are still in the early stages of transhipment, only qualitative textual data
such as port documents, reports from the port websites, and third-party reports on
Indian transhipment are available. Quantitative data, such as transhipment data of
 46

the major Indian container ports, are not available. Therefore, SWOT was chosen for
the qualitative analysis in order to review the available reports and address the re-
search question that this dissertation was designed to address.

3.2 Multi-case study analysis

Several case studies are used to examine this thesis. The use of multiple case designs
can help develop richer, more complex interpretations of a phenomenon and make
reasoning more generalizable. This is more pertinent and validates the choice of
methodology for this study, given that the establishment of transhipment hubs is an
emerging trend in Indian ports. The research question about the possibility of tran-
shipment in important Indian ports is the other factor. As a result, it ultimately de-
pends on multiple port case studies; for this reason, the multiple case study approach
is popular.

3.3 SWOT analysis

Indian Ports' potential as a transhipment hub was evaluated using the SWOT meth-
odology. The SWOT analysis looks at opportunities and threats from the outside as
well as internal strengths and weaknesses. The workforce and other tangible and
intangible resources are considered internal factors, and the firm's capacity to uti-
lise these resources is reflected in its capabilities. Market conditions and competi-
tion are examples of external factors. Understanding the current situation, upcom-
ing opportunities, and creating competitive strategies for the sector's survival and
growth are made easier with the help of this analysis.

SWOT Organisational Characteristics

Strengths Characteristics that give a competitive advantage in the market

Weaknesses Characteristics that give a competitive disadvantage in the market

 47

Opportunities Factors external to firm that can aid in achieving its targets

Threats Factors external to firm that can cause setbacks to achieve its targets

Table 7. SWOT characteristics

(Journal of International Social Research, 2017)

SWOT analysis, when integrated with strategic planning, illuminates a company's

competitive stance and future prospects. Widely adopted across management
schools, it assesses internal and external factors affecting businesses, aiding in mar-
ket share expansion or retention, especially in port contexts. Whether evaluating
lone ports, port sectors, or clusters of rivals, SWOT identifies strengths like robust
cash flow and weaknesses such as limited feeder networks. Threats such as new port
entries and opportunities like increased trade are evaluated to inform strategic de-
cisions. For example, a port may attract liners through investment incentives or com-
petitive pricing amidst upcoming projects. By aligning strategies with SWOT insights,
ports can leverage strengths, address weaknesses, seize opportunities, and mitigate
threats to optimize performance and market positioning.

STRENGTHS WEAKNESS

• High growth • Old infrastructure 6

• High market Share • Low drafts
• Financial means available • Old and inefficient cargo handling systems
• Some Ports located in strategic location • Poor hinterland connections
• Rigid institutional frame work
• High tariffs • Poor quality of services /
business attitude
• Overstaffing
• Lack of capacity
• Lack of extension possibilities
 48

OPPORTUNITIES THREATS

• Introduce competition • Private Ports

• Huge Indian markets, and land locked coun • Minor Ports
tries in the North • Bureaucracy
• Improve organization: training, IT, downsiz- • Time
ing
• Port reform – more autonomy
• PPP other than BOT
• Invest in infrastructure, lower cost for port
users
• Invest in total transport chain

Table 8. SWOT analysis in-context of a Port.

(Ministry of Ports, Shipping and Waterways, 2023)

Some flaws, such as costly maintenance, cannot be fixed as quickly as the labour
shortage. But identifying these vulnerabilities and threats as a recalcitrant or flexible
component can aid in developing a strategy that works every time. Threats and op-
portunities from the outside are more difficult to influence than weaknesses and
strengths from within. On the other hand, an overall perspective suggests that the
past and present conditions of the external elements have an impact on the internal
elements.

3.3.1 Advantages of SWOT analysis

SWOT analysis offers researchers clear benefits, providing a comprehensive view and
macro assessment. It summarizes positive and negative aspects in a two-by-two ma-
trix, aiding in strategy development by identifying opportunities and preventing set-
backs. It integrates with other management strategies like the Balanced Scorecard
and Porter's Five Forces Model, enhancing their effectiveness. SWOT analysis serves
as a starting point for strategic frameworks, crucial for maintaining competitiveness
in the market.
 49

3.3.2 Limitations of SWOT analysis

Opponents point out that the SWOT Analysis is prone to bias, oversimplification, and
out datedness. It mainly depends on the analyst's viewpoint, which could cause ex-
ternal factors to be undervalued or ignored. Not only does it not have a systematic
ranking system for factors, but it may also fail to account for dynamic changes within
a firm, making it difficult to use effectively without extensive skills and knowledge of
global business dynamics.

3.4 Summary of the Chapter

In order to address the research question, the chapter provides an overview of the
multiple case study research design, which is the recommended approach, and the
SWOT analysis technique, which is one possible way to analyse the data. The port
data collected from the pertinent sources is examined in the following chapter,
which is based on the described research design and the qualitative analysis method.
The chapter concludes with a discussion of the SWOT analysis's limitations. The ben-
efits of the tool are also discussed.
 50

4 ANALYSIS OF INDIAN PORTS

The study of Indian ports indicates a diverse landscape of advantages, obstacles, and
clients concerning their future growth as centre for container transhipment. A solid
basis for growth is provided by India's advantageous location, diversified port net-
work, and government programs like Sagarmala and Bharatmala. Significant obsta-
cles are presented by bureaucratic inefficiencies, competition from regional hubs,
and limited infrastructure.

despite these obstacles, there are obvious room for development. Indian ports can
become more competitive by creating in private and foreign investment to solve in-
frastructure limitations and expedite regulatory procedures. They can further
strengthen their position in the global maritime trade landscape by implementing
policy reforms targeted at facilitating business operations and developing partner-
ships with international shipping lines and logistics providers.

Overall, Indian ports can become more competitive and fulfil their potential as es-
sential hubs in global shipping networks, promoting prosperity and economic
growth, by using their strengths, resolving obstacles, and taking opportunities.

4.1 Introduction

Cargo Traffic at Indian Ports

In 2022–2023 major and minor ports in India achieved a total cargo throughput of
1435.23 million tonnes, which is 8.4% more than in 2021–2022 Table 11. Cargo han-
dled at Major & Non-Major ports saw growth of 8.9% and 7.8% in 2022–2023, re-
spectively. Between 2021 and 2022, the percentage of non-major ports in the total
traffic handled at Indian ports fell from 45.6% to 45.4%. Table 9 below shows the
traffic trend handled by major and non-major ports.

Major/Non Major 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23

 51

679.47 699.17 704.93 672.68 720.05 784.27

Major Ports (4.8) (2.9) (0.8) -(4.6) (7.0) (8.9)

529.09 582.61 615.05 577.19 603.56 650.96

Non-Major Ports

(9.0) (10.1) (5.6) -(6.2) (4.6) (7.8)

1208.56 1281.78 1319.97 1249.87 1323.62 1435.23

All Ports

(6.6) (5.9) (8.4)

(6.1) (3.0) - (5.3)

Table 9. Trends in Cargo Handled at Major & Non-Major Ports (Million Tonnes)
(Ministry of Ports, Shipping & Waterways 2023)

Figure 10. Share of overseas cargo traffic at major ports

(Ministry of Ports, Shipping & Waterways, 2023)
 52

Major Ports: Among the Major Ports, Deendayal Port handled the maximum Over-
seas Cargo of 123..88 million tonnes with a share of 20.6% followed by JNPT (13.1%),
Paradip Port (12.8%), Vishakhapatnam Port (Vizag) (9.1%), SMP Haldia Dock (7.3%),
Chennai Port (7.2%), Mumbai Port (6.8%), New Mangalore Port (5.4%), Kamarajar
Port (4.3%), V.O. Chidambaranar Port (4.2%), Cochin Port (3.9%), Kolkata Dock (2.8%)
and Mormugao Port (2.6%) during 2022-23.

India has very less Transhipment Volumes compared to direct import and export.

SR IMP % OF EXP % OF
PORTS IMP EXP
NO THROUGHPUT THROUGHPUT

1 JNPT 2410966 49.90% 2359681 48.80%

2 CHENNAI 653532 42.20% 895925 57.80%
3 TUTICORIN 348278 49.90% 349353 50.10%
4 KOLKATA 330266 51.60% 309917 48.40%
5 COCHIN 261856 47.10% 258595 46.50%
6 VISHAKAPATANAM 190903 49.10% 192287 49.50%
7 KANDLA 60391 51.50% 56762 48.40%
8 NEW MANGALORE 58520 50.70% 56978 49.30%
9 MUMBAI 36008 85.00% 418 1.00%
10 MORMUGOA 16360 51.10% 15644 48.90%
11 PARADIP 3512 51.40% 3325 48.60%
12 ENNORE 2678 100% - 0.00%
4373270 48.70% 4498885 50.10%

SR T/S % OF % OF
PORTS T/S THROUGHPUT
NO THROUGHPUT THROUGHPUT

1 JNPT 62750 1.30% 4833397 53.81%

2 CHENNAI - 0.00% 1549457 17.25%
3 TUTICORIN - 0.00% 697631 7.77%
4 KOLKATA - 0.00% 640183 7.13%
 53

5 COCHIN 3536300% 6.40% 555814 6.19%

6 VISHAKAPATANAM 5435 1.40% 388624 4.33%

7 KANDLA 72 0.10% 117225 1.31%

8 NEW MANGALORE - 0.00% 115498 1.29%

9 MUMBAI 5961 14.10% 42387 0.47%

10 MORMUGOA - 0.00% 32004 0.36%
11 PARADIP - 0.00% 6837 0.08%
12 ENNORE - 0.00% 2678 0.03%
109580 1.20% 8981735

Table 10. Indian Ports throughput and T/S Incidence

(Ministry of Port, Shipping & Waterway, 2019-20)

Figure 10 shows that none of the 12 major Indian ports have a transhipment inci-
dence of at least 25%, indicating that none of them serve as Regional Gateway ports.
Notably, this analysis ignores Haldia Port, the thirteenth major port. Just 1% of the
total throughput of JNPT, the largest container port in Mumbai, is attributed to tran-
shipment, or 62,000 TEU. The only purpose-built transhipment terminal in India, Co-
chin ICTT, is categorised as a Gateway Port because transhipment accounts for only
6% of its overall throughput. Mumbai Port is notable for having the highest tranship-
ment incidence of 14% because of its emphasis on handling bulk cargo.

India's dependence on foreign transhipment hubs to connect shipments to im-

portant trade lanes presents obstacles to the establishment of a transhipment hub.
Indian exporters and importers are forced to rely on foreign ports because of factors
like location, cost, and feeder network, which are frequently superior there. Major
transhipment hubs handle about 33 percent of India's total container traffic. Alt-
hough transhipment traffic is increasing at ports like Krishnapatanam and Adani In-
ternational Container Terminals, their approaches may change. India's public ports
are not very interested in transhipment because of the low margins and high oper-
ating costs. Furthermore, private companies that prioritise gateway traffic in order
 54

to maintain profitability operate the majority of public port container terminals, with
the exception of JNPT. This clarifies the low transhipment incidence in India, as
shown in Figure 11

Figure 11. Indian Container Transhipment Hubs-Indian & Foreign

(Maritime Gateway, 2016)

According to research by Drewry and Gateway Research, Colombo Port handles the
lion's share of Indian transhipment volume. A significant portion of the volumes of
Indian transhipment are also handled by Singapore and Malaysia. Table 12 shows the
percentage of T/S Volumes from India. Other Ports includes upcoming new hub ports
like Salalah (Oman), Khalifa (Abu Dhabi), and so on. Private ports like Adani Interna-
tional Container Terminal (AICT) handle transhipment of about one-third of their
throughput, or about 420,000 TEU, within the domestic market on the west coast.
 55

Krishnapatanam Port (KPCT) is the second largest private player in the Indian tran-
shipment market, handling about 220,000 TEU or 44% of the total throughput.

% of Transhipment by Foreign Hubs

Port 2017-18
Colombo 42%
Singapore 15%
Malaysia 8%
Jebel Ali 3%
Other Ports 32%

Table 11. Indian Container Transhipment volumes % by - Foreign hubs

(Gateway Research and Drewry, 2018)

Technically speaking, KPCT is a regional gateway port due to the transhipment inci-
dence; if its T/S incidence rises above 49%, it may become a hub port. Similar circum-
stances apply to AICT, which remains a regional gateway at 33%.

4.2 Motives for Establishing an Indian Transhipment Hub

Transhipment hubs in Morocco and Turkey attract liner business due to their prox-
imity to major trade hubs and cost advantages, increasing maritime transportation
volume and economies of scale. However, India's reliance on foreign transhipment
hubs incurs substantial additional costs for exporters and importers, hampering in-
ternational competitiveness and resulting in significant economic losses estimated
at millions annually. To address this, India plans to develop two significant tranship-
ment hubs, Colachel in Tamil Nadu and Vizhinjam in Kerala, leveraging their strategic
locations near the East-West Trade Lane and substantial draft for mother vessels.
Feasibility studies indicate promising futures for these projects. Additionally, a SWOT
analysis identified three ports from the west, three from the east, and two upcoming
 56

projects as potential transhipment hubs in India, setting the stage for further exam-
ination and development.

WEST COAST EAST COAST NEW PORTS PROJECTS

JNPT CHENNAI VIZHINJAM
MUMBAI TUTICORIN COLACHEL
COCHIN VISHAKHAPATNAM

Table 12. Major Ports in India

(Byju’s, 2023)

4.3 West Coast Ports

The largest container port in India, JNPT Port, has outstanding infrastructure and ac-
cess to Mumbai's industrial hinterland. Draft restrictions and a lack of feeder net-
works are some of the difficulties it faces despite its high throughput and beneficial
location close to the Strait of Hormuz. Mumbai Port, an important historical port, is
adding new offshore terminals to improve its capacity to handle containers. In con-
trast to JNPT, it experiences low draft and higher charges. The only purpose-built
transhipment terminal in India is located in Kochi Port, which has similar draft re-
strictions and higher fees as a result of dredging costs. Although being close to im-
portant trade routes is beneficial, coming transhipment hubs and possible private
ports pose a threat. Through investments in Sagarmala and the relaxation of captaig
ties, all three ports can grow; however, they also face threats and competition from
other ports as well as changing patterns of trade.
 57

4.3.1 JNPT Port

The largest container port in India, Jawaharlal Nehru Port Trust, handles more than
half of the nation's total container throughput (Table 10). Also referred to as JNPT or
Nhava Sheva, it is placed 28th out of the world's top 100 container ports (JNPT,
2019). JNPT is made up of six terminals: five container terminals and one liquid bulk
terminal. The container terminals are Bharat Mumbai Container Terminal (BMCT),
Nhava Sheva (India) Gateway Terminal (NSIGT), Gateway Terminals India (GTI-APM
Terminals), JNPCT (Jawaharlal Nehru Port Container Terminal), and Nhava Sheva In-
ternational Container Terminal (NSICT-DP World).

Operated by Draft Berths Quay Installed Through-

Length Capacity put
2017-18
JNPCT JNPT (Govt) 14 3 680/445 1500,000 440240 98.78%
NSICT DPW 14 2 600 1200,000 949886 53.43%
GTIPL APM/CONCOR 14 5 840 1800,000 1864434 112.6%

BMCT PSA INTL 16.5 3 1000 2,400,000 1244564 0.97%

NSIGT DPW 14 1 330 800,000 1186183 82.38%

Table 13. JNPT Port Features Part 1

(Indian Container Market Report, 2018)

Total Reefer Yard Quay RTGC RMGC Reach Forklifts

Ground Plugs Area Cranes Stacker
Slots (HA)

JNPCT 10,482 576 61.5/ 9 18 5 10 3

9.9
NSICT 6,222 778 25.8 8 29 3 3 2
4
GTIPL 9,723 880 52 10 40 3 2 6
BMCT 9,366 1,620 90 12 4 36 - -
NSIGT - 336 27 4 12 0 1 -

Table 14. JNPT Port Features Part 2

(Indian Container Market Report, 2018)
 58

Due to its close proximity to Mumbai's industrial hinterland and its connections by
rail and road to other Indian states, JNPT has attracted a large number of liners in-
terested in operating. Liners' ability to focus their operations is one of their biggest
benefits. Nevertheless, the average draft of 14 limits the ability of larger ships to
arrive, which reduces the number of primary transhipment operations that can
switch to JNPT. Although being near the Strait of Hormuz trade route to the Middle
East is advantageous, Table 16 shows that shipments to the region are not very high.

Its world-class port infrastructure and services are the reason it was placed 35th out
of 100 countries in the world by the World Shipping Council. Because international
ports primarily focus on imports and exports, their feeder networks are generally not
robust enough for such ports.

STRENGTHS WEAKNESS

• Frequency of services • Distance from major shipping routes

• Available port infrastructure • Limited draft
• Strong financial positions • Shortage of staff in key areas

OPPORTUNITIES THREATS

• Export-import container trade • Increasing pressure on road and rail

• Free trade zones connectivity
• Ro-Ro cargo • Private port developments in the re-
• Distribution and logistics gion

Table 15. JNPT Port SWOT Analysis

(Indian Port Association, 2007)
 59

4.3.2 Mumbai Port

For many centuries, Mumbai Port (MBPT) has been India's most significant port. The
Bombay Port Trust was established in the 1870s, the same year that the dock was
constructed. Although Mumbai Port primarily handles liquid bulk, dry bulk, and other
commodities, it's noteworthy that 14% of its containers are transhipped. Given that
the average TEU container is only 5,000, there's a chance Mumbai Port could develop
into a transhipment hub. According to the Sagarmala project, more off-shore con-
tainer terminals are being built, and it is anticipated that container traffic will rise
from 0.05 million TEU in 2020 to.10 million TEU in 2035.

According to the Indian Ministry of Shipping, Mumbai Port is well connected to Hin-
terland, NH8 and NH3 in North India, and NH4 and NH 17 in South India. The Port
has a vast railway network connecting it to the rest of India. According to research
conducted by the Indian Ministry of shipping, container handling costs at MBPT are
expected to be higher than JNPT; therefore, attracting customers may necessitate a
reduction in port charges.

STRENGTHS WEAKNESS

• Multi-cargo handling capabilities • Draft constraints

• Location • Lockgate constraints
• Captive cargo of the two oil refiner- • Outdated equipment
ies • High cargo-handling costs
• Sound financial position • Rail/road evacuation problems
• Vast land estate and the port’s prox- • Ageing workforce
imity to a vibrant mega-city. • Delay in project implementation.

OPPORTUNITIES THREATS

• Better productivity at competing • Additional backup facilities such as

ports CFS
• Containerization of cargo • Multi-level car parks
• Fluctuating nature of break-bulk • Empty Yards and Distriparks.
cargo • Cruise Terminal
• The extreme price sensitivity of con- • Convention Centres
• Marina
ventional cargo.
 60

• Development of the Western wa-

terfront.

Table 16. MBPT Port SWOT Analysis

(Indian Port Association, 2007)

4.3.3 Kochi Port

Along with ICTT in Vallarpadom, Port of Cochin has multiple dry bulk and liquid bulk
terminals. The only purpose-built transhipment terminal in India is the International
Container Transhipment Terminal, run by DP World. The details for the same are
listed below:

Operated Draft Berths Quay Installed Throughput Capacity

by Length Capacity 2017-18 Utilisa-
tion
ICTT DPW 14.5 2 605 1,000,000 735577 51.5%

Table 17. ICTT Port Features Part 1

(Indian Container Market Report, 2018)

Operated Total Reefer Yard Quay RTGC RMGC Reach

by Ground Plugs Area Cranes Stacker
Slots (HA)
ICTT DPW 2,500 450 12 4 Super 15 - 3
Post
Panamax

Table 18. ICTT Port Features Part 2

(Indian Container Market Report, 2018)
 61

The port is classified as a gateway port because it only has 7% of transhipment inci-
dence based on the T/S incidence of Kochi ICTT. Because of its operator, DP World,
ICTT has first-rate infrastructure, and its IT systems are comparable to those of other
countries. The fact that ICTT's draft is only 14.5 is one of its biggest problems because
it prevents larger container ships from docking at the port. Due to the problem of
erosion from rivers to the sea, dredging is also very expensive. The main reason why
port charges for ICTT are about 30% more than for Colombo (JOC) is that DP World
bears the cost of dredging, which is then indirectly charged to liners as marine
charges to cover the costs.

Kochi's proximity to the main routes to Australia and the Far East from Europe—just
11 nautical miles—is one of its most notable features (The Hindu Business Line,
2011). Coffee, spices, seafood, and other agricultural commodities make up the ma-
jority of the gateway traffic carried by ICTT. NH47, NH49, and NH17 connect ICTT to
both the east and west coasts of India (Indian Ministry of Shipping). In order to save
a significant amount of time travelling to these major highways, a four-lane container
road connecting to NH17 has been built (Projects Today, 2007). Kochi's transhipment
traffic may be threatened by the construction of two new transhipment hubs that
will be located only a few kilometres away in southern India.

STRENGTHS WEAKNESS

• Geographical location, close to the in- • Low labour productivity and strong la-
ternational East-West shipping route bour unions
• Available land for future development • Lack of industrial growth in the hinter-
activities land
• Protection from monsoons, no cy- • Available draft on 4 berths
clones, moderate wave conditions • Outdated layout of the port
• Presence of the KRL refinery • Poor condition of available infrastruc-
• Presence of oil terminal able to re- ture
ceive large vessels of 115,00 dwt • Low container productivity, limited
back reach area and lack of storage
area
• Lack of intermodal facilities / poor rail
infrastructure
• Customs clearing time
 62

OPPORTUNITIES THREATS

• Vallarpadam terminal to become an • Upcoming port of Vizhinjam as a tran-

international transhipment hub shipment hub
• SEZ’s at Vallarpadam and Puthu- • A possible new transhipment port at
Vypeen with food processing indus- Kolachel
tries • Port expansion at Colombo
• KRL capacity increase • Government policy on imports of fer-
• LNG terminal tilisers
• Tourism • Resistance from urban areas near pro-
• Cochin as liquid bulk centre for the re- posed projects
gion

Table 19. Kochi Port SWOT Analysis

(Indian Port Association, 2007)

4.4 East Coast

The strengths, weaknesses, opportunities, and threats (SWOT) of the ports of Chen-
nai, Tuticorin, and Vishakhapatnam are reviewed in relation to their potential growth
as hubs for container transhipment.

Even though Chennai Port is the second-biggest container terminal in India, not
much transhipment takes place there. Its low transhipment volume and expensive
fees when compared to Colombo are its main disadvantages. Its advantages include
superior hinterland connectivity and terminal productivity. However, Sagarmala's in-
vestment and the relaxation of cabotage present opportunities, and the construction
of a mega container terminal will boost competitiveness. The risks include the po-
tential loss of important customers and competition from neighbouring mega-hub
initiatives.

Similar difficulties face Tuticorin Port, the third-largest port in terms of throughput
of containers; its advantages include a stronger draft and robust connectivity, but its
disadvantages include limited infrastructure and a reliance on Colombo for tranship-
ment. Opportunities presented by the Sagarmala investment and the Sethusam-
udram Canal Project are offset by the possibility of client attrition and competition
from adjacent projects.
 63

With its deep draft and infrastructure, Vishakhapatnam Port exhibits promise as it
seeks to capitalize on Sagarmala investment and cabotage relaxation for the expan-
sion of transhipment. Its potential as a transhipment hub is under threat by factors
like low transhipment incidence and competition from Adani Ports' acquisitions,
however it has strengths in capacity and productivity.

4.4.1 Chennai Port

Chennai and Tuticorin are Tamil Nadu's two main ports in East Section. The two con-
tainer terminals owned by Chennai Port Trust are CITPL (Chennai International Ter-
minal) and CCTL (Chennai Container Terminal), which are run by PSA and DP World,
respectively. Out of the twelve major ports, Chennai Port has the second-highest
throughput of containers.

Oper- Draft Berths Quay Installed Through- Capacity

ated by Length Capacity put 2017 - Utilisation
18
CCTL DPW 15 4 885 12,00,000 729530 53.8%
CITPL PSA 15.5 3 832 1,250,000 872637 72.1%

Table 20. Chennai Terminals Features Part 1

(Indian Container Market Report, 2018)

Total Reefer Yard Quay RMGC Reach Forklifts

Ground Plugs Area Cranes Stacker
Slots (HA)
CCTL 3,960 355 18 8 3 21 1
CITPL 5,424 306 35 7 0 6 0

Table 21. Chennai Terminals Features Part 2

(Indian Container Market Report, 2018)
 64

Even though Chennai Port is India's second-biggest container terminal, it does not
have a significant transhipment volume, which represents a gap in its market posi-
tioning. All the same, it has all the infrastructure it needs, with ample draft for me-
dium-sized ships, good road and rail connections, and state-of-the-art handling ma-
chinery. The port offers discounts and concessions in an effort to draw transhipment
business. Notably, Chennai Port looked into transhipment possibilities as a result of
Maersk, a significant client, moving to Adani Ennore Port. Even though transhipment
volumes have increased since 2018 and Chennai already has a sizable share of the
coastal container transportation market, future development projects like the pro-
posed Mega Container Terminal could make Chennai a more attractive transhipment
hub.

STRENGTHS WEAKNESS
• Dedicated facilities for handling all ma- • Traffic evacuation not allowed during
jor cargo types the day time
• Good multimodal connectivity • Restricted land availability
• Long term agreements with users like • Sub-optimal usage of rail connectivity
CPCL and Hyundai • Exposure to dust & saline environ-
• Best location on the East Coast for ment
cruise operations in view of good air • Perceived need for improvement in
connectivity and proximity to cruise service levels
destinations • Low efficiency and high tariffs levels
• Sufficient reserves & surplus Surplus labour

OPPORTUNITIES THREATS
• Positive economic environment in the • Competition from major ports spe-
years to come with an anticipated cially from Ennore and Tuticorin
7% GDP growth rate port
• Increasing containerisation and good • Competition from minor ports mainly
forecasted demand from Krishnapatnam
• Strong forecasted growth in automo- • Expected ban on export of minerals
bile exports
• JV or strategic investment with minor/
intermediate ports
• Better road connectivity after con-
struction of proposed road projects
Facilitate cruise tourism
• Public-private partnerships

Table 22. Chennai Port SWOT Analysis

(Indian Port Association, 2007)
 65

4.4.2 Tuticorin Port

Tuticorin has third-biggest container throughput amongst the 12 major ports.

Operated Draft Berths Quay Installed Through- Capacity

by Length Capacity put 2017 - Utilisa-
18 tion
TCT PSASICAL 10.9 1 370 450,000 185034 110.6%
DBGT DBGT 14 1 345 600, 000 498,279 33.5%

Table 23. Tuticorin Terminals Features Part 1

(Indian Container Market Report, 2018)

Total Reefer Yard Quay RTGC RMGC Reach Forklifts

Ground Plugs Area Cranes Stacker
Slots (HA)
TCT 1,000 84 4 3 8 0 2 1
DBGT 400 - 6.5 3 9 0 2 0

Table 24. Tuticorin Terminals Features Part 2

(Indian Container Market Report, 2018)

The two container terminals run by Tuticorin Port Trust, TCT and DBGT, have com-
paratively smaller berths that are appropriate for ships under 5000 TEU. Tuticorin
has the second-highest capacity utilisation rate among the major ports; however, its
transhipment volumes are restricted because of things like the size of its berths and
its emphasis on exporting clothing. Nonetheless, the port has invested $200 million
in infrastructure upgrades as part of the Sagarmala project, taking advantage of its
close proximity to South India's apparel manufacturing industry. The 400-hectare in-
dustrial area that is planned aims to draw in more business. Reducing dependency
on transhipment hubs like Colombo and lowering costs for shippers, the port has
started to accept larger vessels with 14-meter drafts and has agreements in place
with shipping lines such as Wan Hai Lines to handle garment exports to the US.
 66

STRENGTHS WEAKNESS

• Geographic advantage o Close to main • Infrastructure

shipping lines, all weather port • Poor rail connectivity to important hin-
• No maintenance dredging costs Availa- terland industrial clusters
bility of Land for future expansion / up • Comparatively high port dues
gradation • Trade imbalance in containers
• High level of overall efficiency • IT infrastructure o Poor with legacy sys-
• Proactivity tems delivering no real time infor-
mation flow

OPPORTUNITIES THREATS

• Construction of Outer Harbour • Time

• Development of Tuticorin as Distribu- • Competition
tion Hub o Short term for South • Dependence on “political” goods Ther-
• Development of Tuticorin as “Power mal coal, fertilizer, wheat, sugar
Hub” • Shipping trends
• Proactive attitude of Tamil Nadu Govt • Direct shipments to and from other In-
Industrial development and attracting dian ports
FDI
• Development of Sethusamudram Chan-
nel

Table 25. Tuticorin Port SWOT Analysis

(Indian Port Association, 2007)

Once the Sethusamudram Project is finished, which opens a channel between Sri
Lanka and India, Tuticorin is anticipated to benefit. Vessels travelling from West India
to Eastern India can save sailing time by using this channel instead of currently going
around Sri Lanka. Not only will this project improve Tuticorin, but it will also
strengthen the entire East and West Indian coastal trade. But the current Indian gov-
ernment has stopped dredging and is searching for a substitute.
 67

4.4.3 Vishakhapatnam Port

An important port in Eastern India with some transhipment activity is Vishakhapat-

nam. With a draft of 16.5 metres, VCTPL can accommodate larger vessels for berth-
ing, and its infrastructure is sufficient for a 700k TEU terminal. The port is currently
working on an expansion plan for 0.5 million TEU.

Operated by Draft Berths Quay Installed Throughput Capac-

Length Capacity 2017 - 18 ity
Utilisa-
tion
VCTPL ICTIPL/DPW 16.5 2 450 700, 000 511471 55.5%

Table 26. Vishakhapatnam Terminals Features Part 1

(Indian Container Market Report, 2018)

Total Reefer Yard Quay RTGC RMGC Reach Fork-

Ground Plugs Area Cranes Stacker lifts
Slots (HA)
VCTPL 2,500 204 16.4 4 6 0 5 3

Table 27. Vishakhapatnam Terminals Features Part 2

(Indian Container Market Report, 2018)

With a compound annual growth rate (CAGR) of 22.9%, Vishakhapatnam has dou-
bled its infrastructure since its founding in 2003. The relaxation of the coast guard
and Vishakhapatnam's status as one of the top container coastal transportation hubs
in the east are two of its biggest advantages. According to Gateway Research and
Drewry, this port has the highest productivity in the Indian port sector in terms of
average vessel turnaround time (17 hours) and crane productivity (24 moves per
hour). The average pre-berthing time is also very high at 1.9 hours.
 68

With the relaxation of cabotage, Vishakhapatnam hopes to become a bustling tran-

shipment hub and anticipates a rise in feeder services and transhipment volumes. In
India, Vishakhapatnam ranks fifth in terms of the total weight transported by coastal
means. In the event that the liners receive better offers and shipment volumes, they
might draw transhipment from Bangladesh and Myanmar.

The biggest transhipment volume in India is handled by Krishnapatanam Port, which

poses a serious threat to them. With transhipment containers accounting for 44% of
throughput, they are practically a transhipment hub. Furthermore, the largest termi-
nal operator in India, Adani Group, intends to acquire a 72% share in Krishnapatanam
Port in order to surpass it. Vishakhapatnam will face intense competition in terms of
transhipment volumes given the Adani Group's market share.

STRENGTHS WEAKNESS
• Deep water port in outer harbour • Entrance channel capacity
and on anchorage • A non-incentive tariffs structure
• Handling of VLCC’s at anchorage Manual coal handling with low
Mechanised handling of iron ore productivity
handling complex • Bureaucracy and inefficient use of
• Good railway connectivity facilities
• Healthy financial position (ex pen- • Close proximity to the city
sion liabilities)

OPPORTUNITIES THREATS
• Strong development of the Indian • Strong inter-port competition on
economy the hinterland of Visakhapatnam
• Plans for investments in the industry substantial private investments in
and therewith growth potential in these new ports
the hinterland of Visakhapatnam • Relatively strong labour unions
• Long procedures, compared to pri-
vate ports

Table 28. Vishakhapatnam Port SWOT Analysis

(Indian Port Association, 2007)
 69

4.5 Upcoming Port Projects

Kerala's Vizhinjam Port, with its deep natural draft, helpful location, and capacity to
handle large container ships without needing costly dredging, plans to become a ma-
jor maritime hub. It closes an important gap in India's port infrastructure, with plans
to handle 4.1 million TEUs annually and accommodate mother vessels. Adani Ports'
involvement and Vizhinjam's proximity to major trade routes position it as a poten-
tial regional hub, offering opportunities for economic growth and reducing depend-
ency on foreign transhipment hubs, despite challenges such as low cargo volume and
construction delays.

Colachel Port, located in Tamil Nadu, has the ability to develop into a major tranship-
ment hub by an approximate $3.4 billion investment. It offers several benefits due
to its convenient position near trade routes and industrial centres as well as its strong
connectivity. Colachel intends to compete with Vizhinjam despite their close proxim-
ity by focusing on regional cargo and projecting a major increase in container traffic.
High project costs, competition from nearby ports, and possible environmental is-
sues are some of the difficulties. However, there are positive chances for growth
through Sagarmala investments and India's economic growth.

4.5.1 Vizhinjam Port

Vizhinjam, in Kerala, South India, is ideally situated for a port due to its strategic lo-
cation along the international east-west shipping route. Its accessibility is improved
by its closeness to regional and national transport and rail networks. It closes a gap
in India's port infrastructure by accommodating large container ships at depths of 23
to 27 metres. The planned port would be built on 250–275 hectares of land that had
been reclaimed from the ocean. It would have two breakwaters, harbour basins, and
wharves with thirty berths that could accommodate mother vessels. India's increas-
ing need for more port capacity makes the development of Vizhinjam crucial.
 70

Its completion is anticipated to enable it to handle 4.1 million TEUs per year and
house vessels up to 12,000 TEUs, thereby reinforcing its position as a major maritime
hub. (VizhinjamPort.org)

Being the first and only transhipment port in India with a natural depth of more than
20 metres, Vizhinjam is unique in that it can accommodate large vessels without re-
quiring expensive dredging. Its strategic advantage lies in its close proximity—just 12
nautical miles from the international shipping route—which enables ships to dock
quickly. Because of its distinct advantage, Vizhinjam is well-positioned to help India
strengthen its foreign exchange reserves and lessen its dependency on foreign tran-
shipment hubs.

India's container volume is far less than China's, so Vizhinjam capacity to handle
some of the biggest ships in the world—up to 20,000 TEUs—offers a chance to satisfy
the growing demand for larger vessels on international trade routes. This develop-
ment is in line with India's goals as stated in Maritime India Vision 2030, which aims
to improve the nation's maritime infrastructure and economy.

Operated Draft Berths Quay Installed Throughput Capacity

by Length Capacity 2017 - 18 Utilisa-
tion
Vizhinjam Adani 18 2 800 900, 000 0 0
Ports

Table 29. Vizhinjam Port Features Phase 1

(Indian Container Market Report, 2018)
 71

Figure 12. Vizhinjam port location vs. Colombo & international East-West shipping
route
(Swarajya Oct. 2023)

This seaport project consists of building a 3.1-kilometer breakwater, an 800-meter

container berth to accommodate two 12,500 TEU (twenty-foot equivalent unit) con-
tainer vessels, and a fishing harbour. (V. Bhagya Subhashini, Article Publish in Swa-
rajya Oct. 2023).

Phase 1 Phase 2 Phase 3

Gateway Traffic 138,459 392,371 768,904
T/S Traffic 683,798 1,292,842 2,054,545
Total 822,257 1,685,213 2,823,449

Table 30. Traffic Forecast Vizhinjam in 3 phases

(AECOM, 2012)

Vizhinjam next advantage is its close proximity to important trade routes. It is pre-
dicted that the T/S incidence will be 83% in Phase 1 and 73% in the final phase. This
project is expected to have an overall average of 75%, which means that it is not a
 72

transhipment hub per se, but rather a regional hub. Dredging is inexpensive when
there is natural depth, which is another benefit. Vizhinjam has excellent rail connec-
tions to other regions of India in addition to being well-connected to the rest of the
country via NH47 and NH17.

Adani Ports, one of the most prosperous terminal operators in the nation with strong
ties to important Indian liners, is a critical component of this project's possible suc-
cess. Lack of direct export/import is one of Vizhinjam disadvantages; even ICTT Kochi
can only fulfil 50% of its capacity at this point because of lower volumes.

STRENGTHS WEAKNESS
• 18 m Natural Draft • Very Less Exim Cargo due to
• Adani Ports handling the project presence of Kochi ICTT
• Proximity to major trade lanes. • Expensive Project
• Good Hinterland and Feeder • Construction delays
Connectivity • Delay in Customs
• Excellent Infrastructure
• Can handle traffic to East and
West India
OPPORTUNITIES THREATS
• Gains if the Sethusamudram • Colachel Port few nautical miles
Canal Project is completed. away will start operating.
• Cabotage Relaxation • Environmental Issues for
• Investment from Sagarmala Construction and Operation
• Possible Transhipment volumes • DP World operating ICTT
from Bangladesh/Burma • Colombo will reduce rates
• Economic Growth in India

Table 31. Vizhinjam Port SWOT Analysis

(AECOM, 2012)

It is suggested that Vizhinjam be the solution to Colombo, which manages 40–50%

of the transhipment sent from India. A transhipment hub would have all of its char-
acteristics, excluding import cargo. Adani Ports' sway over the Indian liner industry
is another noteworthy benefit. It can play a major role in securing new routes and
 73

utilising all of the port's resources and throughput to provide liners with a more at-
tractive package.

4.5.2 Colachel Port

Located in Tamil Nadu, Colachel is a Mega Transhipment hub situated at the south-
ern tip of India. Tuticorin Port Trust is in charge of the port's construction, which is
expected to cost about $3.4% billion.

Figure 13. Location of Colachel

(The Indian Express, 2016)

The Port is considerably closer to trade lanes than Vizhinjam Port, and it is only 35
km from Vizhinjam. Colachel's proximity to important industrial and trade hubs like
Tirupur, Erode, Sivas Kasi, etc., is another of its main advantages. Once Colachel is
operational, all of these cargos can be transhipped via Colombo and returned, as
illustrated in Figure 13.

One of the most important aspects of this is Colachel's connectivity to other states,
which is provided by national highways and railroads. Because of its low cost and
 74

convenient transhipping, it is anticipated to draw a sizable amount of traffic from

neighbouring states. Even in the most optimistic scenario, the estimated volume of
Colachel is significant, with 1.7 million TEU in 2020 and 4.9 million in 2025. This is
because it is known that in order to compete with other transhipment ports, the port
in question must have volume and capacity projections that are on par with or
greater than those of the rival ports.

STRENGTHS WEAKNESS
• 18 m Natural Draft • Expensive Project
• Huge Investment plan • Proximity to 2 Transhipment ports
• Proximity to major trade lanes. in India
• Good Hinterland and Feeder • Delay in Customs operations
Connectivity
• Proximity to regional Exim
containers for Gateway traffic
• Excellent Infrastructure
• Can handle traffic to East and
West India
OPPORTUNITIES THREATS
• Gains if the Sethusamudram • Vizhinjam few nautical miles away
Canal Project is completed. will start operating.
• Cabotage Relaxation • Environmental Issues for
• Investment from Sagarmala Construction and Operation
• Possible Transhipment volumes • Private Ports in South India
from Bangladesh/Burma • Colombo will reduce rates
• Economic Growth in India

Table 32. Colachel Port SWOT Analysis

(BCG, 2015)
 75

4.6 Summary of the Chapter

Based on the SWOT Analysis, below are the conclusions made:

West Coast East Coast New Ports Projects
JNPT Chennai Vizhinjam
Mumbai Tuticorin Colachel
Cochin Vishakhapatnam

Table 33. Major India Ports region-wise.

(Byju’s, 2023)

West Coast
Jawaharlal Nehru Port Trust (JNPT) holds promise as a major transhipment gateway
in India due to its size, infrastructure, and cargo volumes. However, divergent strat-
egies among terminal operators hinder its effective utilization for transhipment traf-
fic. Mumbai Port (MBPT) faces limitations with low draft depth and prioritization of
other cargo types, constraining its transhipment potential.

Cochin International Container Transhipment Terminal (ICTT) competes well but

struggles with higher costs and impending competition. Government intervention,
including dredging subsidies, is essential to overcome these challenges and maximize
India's transhipment potential. Despite hurdles, JNPT, particularly its terminal BMCT,
is positioned to emerge as a transhipment hub on the west coast, given its connec-
tivity, infrastructure, and established liner business.

East Coast
Chennai Port is the second-largest container port in India by throughput, but because
of its high export-import volumes and robust hinterland connectivity, it sees very
little transhipment traffic and functions mainly as a gateway port. A significant in-
vestment in a container terminal is planned, but it has not yet been put into action.
 76

The third-biggest container port, Tuticorin Port, cannot successfully compete with
Colombo for transhipment volumes because it does not have enough draft depth to
accommodate larger vessels.

In contrast, Visakhapatnam Port, which has a draft depth of 16.5 metres and superior
productivity, is the port in the region with the fastest rate of growth. Of the three
ports in the East region, Visakhapatnam holds the most promise as a transhipment
hub due to its current transhipment activity and ability to draw cargo from neigh-
bouring countries like Bangladesh and Myanmar.

New Port Development

The southernmost point of India is home to two deep seaports, Vizhinjam and Cola-
chel, both of which have drafts of 18 metres, making them able to handle ships car-
rying up to 18,000 TEU. Similar nautical characteristics separate Vizhinjam and Cola-
chel, but Colachel has stronger hinterland connectivity to significant industrial cities
and a higher projected throughput from these areas, supported by a larger invest-
ment of 3.5 billion USD versus Vizhinjam 1 billion USD.

Furthermore, Colachel has a strategic advantage over Vizhinjam due to its closeness
to the main trade route. Until Vizhinjam is put into service, its operational viability—
especially with regard to managing transhipment volumes—remains uncertain. Cola-
chel is better positioned than Vizhinjam in terms of transhipment volumes because
of these elements as well as its significant investment.
 77

5 CONCLUSION

India has a 7,500 km long coastline, so setting up several transhipment hubs is nec-
essary to meet its needs for maritime trade. With two hubs being built at the south-
ernmost point of the nation, any port could offer a tactical edge in direct competition
with Colombo, which is pursuing ambitious plans for expansion. But to be successful
in this endeavour, a national strategy akin to that of maritime nations such as Singa-
pore is needed, in addition to competitive port charges and connectivity. Singapore's
high rankings in the Logistics Performance Index (LPI) and Ease of Doing Business
(EODB) are the result of well-thought-out national strategies that take advantage of
the country's location in the Malacca Strait.

On the other hand, despite Pakistan's strategic role in projects like the China-Paki-
stan Economic Corridor (CPEC), operational problems at ports like Gwadar under-
score the impact of lower ratings in GPIs like EODB and LPI. On the other hand, India's
policies like Sagarmala and the relaxation of captivity, along with its bilateral ties with
its neighbours, offer the chance to transform Indian ports into significant tranship-
ment hubs.

The Indian government understands that enhancing GPIs like EODB and LPI will boost
confidence among stakeholders and investors, which will enable more investment in
the economy and draw in foreign direct investment (FDI). India can establish its ports
as important participants in international maritime trade by making infrastructure
investments, enacting policy changes, and improving GPIs.

Despite difficulties brought on by several terminal operators and draft restrictions

JNPT's infrastructure and capacity seem to make it the most suitable option for tran-
shipment. Due to draft restrictions, Mumbai Port's offshore terminal expansion of-
fers little opportunity for transhipment, and its throughput and capacity are con-
 78

strained. Given its purpose-built nature, ICTT with DP World is a logical choice; how-
ever, because of high dredging costs and higher charges, it faces competitive chal-
lenges against international hubs in terms of cost.

Here, the only choice is to subsidise the cost of dredging, as the Sri Lankan govern-
ment does. When it comes to port connectivity, JNPT is the ideal choice for a T/S
hub.

Vishakhapatnam, with a draft of 16.5 metres, is the best option when it comes to the
East of India when it comes to position/location and connectivity. Chennai may be
able to compete, but its primary focus is on gateway traffic. Given its expansion plans
and its current volume of transhipment traffic, Vishakhapatnam appears to be the
port most qualified to handle transhipment. Given the transhipment incidence,
Vizhinjam would be the best transhipment hub among the new ports based on pro-
jections. This is because transhipment accounts for half of Colachel's throughput as
a regional gateway.

Colachel and Vizhinjam have similar draft depths of 18 metres. Colachel is in a better
position than Vizhinjam, being just 4 nm closer to the main trade lane. It is believed
that Colachel Port's plan is more practical than Vizhinjam since Colachel has a fall-
back plan for gateway traffic, whereas Vizhinjam does not. Vizhinjam lone advantage
over Colachel is the terminal operator Adani Port, which has greater sway over liner
business than do public ports. The cost of transhipping goods outside of India to the
economy is only $400–600 million, so the country can currently function without a
transhipment port or afford the failure of a T/S hub.

The economy will be directly impacted by the failure of a T/S hub if the trend does
not continue as expected or if transport becomes prohibitively expensive. This in-
vestment in a mega transhipment hub will strengthen India's position in the upcom-
ing decades, especially in light of the government of India's initiative to make trade
within the country more economical and easier through the implementation of
 79

Sagarmala and other projects. The frequency and volume of transhipments will rise
in the upcoming years due to the relaxation of policies regarding cabotage and other
matters. India has the potential to have three transhipment hubs: Vishakhapatnam
in the east, JNPT in the west, and Colachel in the south.

When all three of the above-mentioned ports are taken into account, Colachel satis-
fies the two primary requirements for a transhipment hub, which have been empha-
sised heavily in numerous studies: near the trade lane and with a deep draft. Colachel
has the potential to surpass Colombo and Singapore as the top transhipment hub in
South Asia with sufficient investment and infrastructure development. As a terminal
operator, Liners' investment is also necessary for the transhipment hub to succeed
since it can increase the number of vessel callings and transhipment activity in the
port. Colachel might consider the possibility of using Liner as a terminal operator,
which could lead to more ships calling at this port, creating economies of scale and
lowering shipping costs for merchants.

5.1 Limitations of this research study

A liner's decision to choose a port as its transhipment hub may be heavily influenced
by liner data and routing information, which were not taken into account in this
study. When a liner chooses a hub port, they need to take into account a number of
factors that were not taken into account in this study, such as deviation time and
cost, vessel turnaround time, waiting time in port, port cost, time and cost in feeder
link, number of services calling at the port, etc.

One significant limitation of this research is the lack of research studies on Indian
transhipment hubs. Ports are limited to trying to meet the requirements of Liners, as
they determine the best location for their transhipment hubs. His requirements for
a transhipment hub were examined in this study with reference to major Indian
ports, but primary data from the Indian liner industry, such as interviews, and sec-
ondary data, such as liner reports, were not included in order to analyse whether
 80

shipping lines will choose any Indian ports as their transhipment hub. Additionally,
the study only looks at India's twelve largest public ports; private ports are left out.

The conclusion points out the possibility of India creating transhipment hubs along
its long coastline, with particular focus paid to strategically important sites such as
Colachel, JNPT, and Vishakhapatnam. It encourages a national competitiveness-
boosting strategy that is similar to Singapore's and places a focus on elements like
draft depth and connectivity. The study's limitations, which might affect the study's
accuracy and conclusions, are recognized in the conclusion. These include the pau-
city of data on liner preferences, the exclusion of private ports, and the lack of re-
search on Indian transhipment hubs. The study recognizes the operational difficulties
that ports like Mumbai and JNPT face and suggests fixes like cost subsidies for dredg-
ing. Its names Colachel as a possible top hub and names Vishakhapatnam and Vizhin-
jam as promising hubs.

However, the conclusion points out that hub selection may be strongly affected by
liner choices, which were not fully taken into consideration. It suggests that in order
to give a more thorough understanding of India's transhipment potential and help in
making effective strategic choices, future research should address these limitations.

5.2 Suggestions for future research

Transhipment services are emerging as a significant phenomenon within the Indian

shipping sector. In order to remain competitive in the port industry, Indian ports of-
fer transhipment services throughout Southeast Asia. The Indian Port Authorities
should conduct additional research in this field because, as the limitation states,
there were insufficient pertinent studies on the transhipment sectors.

Future studies on the growth of Indian seaports as hubs for the transhipment of con-
tainers must focus on a number of important areas. The assessment of turnaround
times, berth utilization, and the adequate size of port infrastructure must take into
account operational efficiency and infrastructure development. To understand how
 81

ports, integrate with hinterland transportation networks and find areas for improve-
ment, intermodal connectivity evaluation is required. Furthermore, examining the
laws and rules that control transhipment operations can provide light on how to
make ports more competitive. Together with evaluating environmental sustainability
issues, it is important to understand market dynamics and the role that advances in
technology play to improve operations.

Finally, areas for improvement can be found through competitive benchmarking

against globally recognized transhipment hubs. Further investigation into these do-
mains can provide significant perspectives and suggestions to stakeholders within
the maritime sector, which will allow well-informed decision-making concerning the
development of Indian seaports as hubs for container transhipment.
 82

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https://containersindia.in/2019/pdf/INDIAN%20CONTAINER%20MARKET%20RE-
PORT-2018.pdf

Tuticorin Terminals Features Part 2 (Indian Container Market Report, 2018).

https://containersindia.in/2019/pdf/INDIAN%20CONTAINER%20MARKET%20RE-
PORT-2018.pdf

Vishakhapatnam Terminals Features Part 1 (Indian Container Market Report, 2018),

https://containersindia.in/2019/pdf/INDIAN%20CONTAINER%20MARKET%20RE-
PORT-2018.pdf
 86

Vishakhapatnam Terminals Features Part 2 (Indian Container Market Report, 2018),

https://containersindia.in/2019/pdf/INDIAN%20CONTAINER%20MARKET%20RE-
PORT-2018.pdf

Vizhinjam Port Features Phase 1 (Indian Container Market Report, 2018),

https://containersindia.in/2019/pdf/INDIAN%20CONTAINER%20MARKET%20RE-
PORT-2018.pdf

Indian Container Transhipment volumes % by - Foreign hubs, (Gateway Research

and Drewry, 2018), https://containersindia.in/2019/pdf/INDIAN%20CON-
TAINER%20MARKET%20REPORT-2018.pdf

Indian Ports throughput and T/S Incidence, Table 10: Indian Ports throughput and
T/S Incidence (Ministry of Port, Shipping & Waterway, 2019-20),

https://shipmin.gov.in/sites/default/files/BPS2020.pdf

Traffic Forecast Vizhinjam in 3 phases, (AECOM, 2012), https://vizhin-

jamport.in/wp-content/uploads/2023/09/Final-Master-Plan-Report_Nov30-
2012.pdf

Vizhinjam Port SWOT Analysis, (AECOM, 2012), https://vizhinjamport.in/wp-con-

tent/uploads/2023/09/Final-Master-Plan-Report_Nov30-2012.pdf

Colachel Port SWOT Analysis, (BCG, 2015), https://sagarmala.gov.in/sites/de-

fault/files/TYPSA-Enayam_TEFR.pdf

Major India Ports region-wise, (Byju’s, 2023), https://byjus.com/free-ias-prep/ma-

jor-ports-in-india/
 87

Major Ports in India, (Byju’s, 2023), https://byjus.com/free-ias-prep/major-ports-in-

india/

(UNCTAD, 2018)

https://unctad.org/system/files/official-document/rmt2018ch1_en.pdf

(Allied Market Research, 2019)

https://www.alliedmarketresearch.com/shipping-containers-market

(IMF, 2023)

https://en.wikipedia.org/wiki/Economy_of_India#cite_note-IMF2-51

(Indian Ministry of Ports, Shipping & Waterways, 2023).

https://shipmin.gov.in/division/shipping