Samsara Newsletter

Week 4, 2020 (Jan 18 - Jan 24)

Policy & Economy News

Prime Minister Narendra Modi pitches '3 T strategy' to boost economic diplomacy

India attracted 16 pc more FDI in 2019, says UN report

PE, VC investments in India grew 28 per cent to US$ 48 billion in 2019, says EY data

Business News - The India Boom Factor

Grape exports surge

Tripura Special Economic Zone along Bangladesh border to benefit many sectors

New Onion crop arrival: Govt mulls lifting ban on exports

Passenger vehicle exports rise 6 per cent in April-Dec; Hyundai, Ford lead the pack

Shipping News

Terminal handling charges to be paid directly to port trusts

Logistics News

'Madhya Pradesh to become India's Warehousing Hub'

Despite near-flat absorption in 2019, demand for warehousing on the rise in Bengal

500 km of DFC completed; aiming for 991 km by March 2020

Coastal Containers to move now via Vallarpadam Rail Link

Indian Port News

GSPC LNG terminal at Mundra Port goes onstream; 3rd facility in Gujarat

VPT moots international trade hub near airport

Gujarat Maritime Board plans ₹1,750 crore (Rs.17.5 billion) brownfield port at Bhavnagar via Swiss Challenge Route

V.O.C Port breaks its own record, handles vessel with highest parcel size

Kamarajar Port to set up port-related industries at ₹70 crore (Rs.700 million)

Policy & Economy News

Prime Minister Narendra Modi pitches '3 T strategy' to boost economic diplomacy
Business Today - New Delhi, January 22 Top
In a bid to boost exports, PM Modi asked officials to focus on Ease of Doing Business measures at district level

Prime Minister Narendra Modi has reportedly floated a three-point strategy to boost country's economic diplomacy. PM Modi held talks with a panel of senior government officials to strengthen India's economic diplomacy and rework strategy related to this, reported CNBC TV18.

As per the report, the PM has mooted three 'T' - trade, tourist and technology - to boost Indian economic diplomacy. The proposal aims to use India's overseas missions and embassies as tools to increase exports from the country.

"According to PM, the functioning of Indian missions should be judged from their ability to boost trade, tourist inflows and facilitating technology transfer to Indian companies," the agency quoted a senior government official as saying.

The official added that PM Modi's inputs would be considered in the upcoming budget.

PM Modi proposed his idea to a panel of officials, which comprised of secretary-level officers from ministries such as commerce, finance, heavy industries and health, at a meeting where he was given a presentation on 'Vision for the Indian Economy' last week, the report said.

In a bid to boost exports, the PM asked the panel to reach out to states and draw up district-specific export strategies, said official. He directed them to work in measures to improve agriculture exports and study the reason for the rejection of Indian farm export consignments at foreign ports. He also asked officials to focus on Ease of Doing Business measures at the district level.

On tourism, the PM directed officials to draw up a strategy on popularising the Buddhist circuit amongst foreign travellers.

According to a recent government data, India's export contracted for the fifth month in a row by 1.8 per cent in December 2019 to $27.36 billion, affected by currency volatility, fluctuation in commodities prices. Exports of gems and jewellery declined for nine consecutive months by 2 per cent YoY to $2,436 million in December 2019.

India's trade deficit also declined to $11.25 billion in December as against the deficit of $14.49 billion in the same period a year ago.

India attracted 16 pc more FDI in 2019, says UN report
Exim News Service - Geneva, Jan. 23 Top
India attracted an estimated $49 billion in FDI in 2019, a 16 per cent increase from the $42 billion recorded in 2018, and thereby not only drove the FDI growth in South Asia but also was among the top 10 recipients of FDI in 2019, said the Global Investment Trend Monitor report compiled by United Nations Conference on Trade and Development (UNCTAD), as per a report.

Developing economies continue to absorb more than half of global FDI flows. South Asia recorded a 10 per cent increase in FDI to $ 60 billion and this growth was driven by India. FDI to the European Union fell by 15 per cent, while there was zero-growth of flows to the United States. Despite this, the United States remained the largest recipient of FDI, followed by China and Singapore, the report added.

PE, VC investments in India grew 28 per cent to US$ 48 billion in 2019, says EY data
IBEF - January 24 Top
In 2019, private equity and venture capital investments in India reached an all-time high in terms of both value and volume. In terms of value, investments increased at 28 per cent to US$ 48 billion, compared to US$ 37.4 billion recorded in 2018.

The growth witnessed was on the back of increased investments in the infrastructure sector which alone accounted for 30 per cent of the overall investments in 2019 by value compared to 12 per cent in 2018, as per the EY data.

The data also included deals that were announced but are still awaiting closure like ADIA, PSP and NIIF's investment in GVK and others.

In 2019, in terms of volume, there were 1,037 deals recorded witnessing an increase by 35 per cent over from a year-ago period (769 deals in 2018), 60 per cent of which were in the start-up space. Start-ups recorded a 61 per cent rise in terms of number of deals in 2019 as compared to last year (378 deals in 2018).

Though, there was a decline of three per cent in pure play PE/VC investments but there was a significant increase in investments in the infrastructure and real estate asset classes which recorded an increase of 225 per cent and 33 per cent, respectively, on a y-o-y basis.

In 2019, PE/VC investments recorded the highest ever value in the infrastructure sector with US$ 14.5 billion as compared to US$ 4.5 billion in 2018 while real estate received US$ 6.1 billion against US$ 4.6 billion in 2018.

Buyouts overtook growth capital deals for the first time and were recorded as the primary PE/VC deal type accounting for 34 per cent of all PE/VC investments by value in 2019. It recorded an increase of 56 per cent in terms of value with US$ 16.2 billion in 2019 as compared to US$ 10.4 billion in 2018.

In the last two years, buyouts received US$ 26.7 billion in deal value, which is more than the value of buyouts in the previous 12 years combined.

Also, there were 58 deals of buyouts in 2019 which are the highest ever. This was driven by significant increase in the value (180 per cent increase y-o-y) and number (123 per cent increase y-o-y) of buyouts in the infrastructure and real estate sectors. Buyouts in the traditional PE/VC space, though, decreased in both value (26 per cent decline y-o-y) and volume (19 per cent decline y-o-y) in 2019.

In 2019, growth capital investments increased by 9 per cent at US$ 14.5 billion against US$ 14.2 billion in 2018. This too was primarily on account of increase in growth investments in infrastructure and real estate sectors which witnessed a growth by 136 per cent (US$ 7.3 billion in 2019 against US$ 3.1 billion in 2018) in terms of value and 97 per cent in terms of volume (59 deals in 2019 against 30 deals in 2018) respectively.

Though, pure play PE/VC growth capital investments witnessed a decline of 26 per cent in terms of value and 13 per cent in terms of volume.

In 2019, investments in Start-up were the highest ever in terms of value and volume with US$ 7.9 billion as compared to US$ 6.5 billion in 2018. This was 22 per cent growth. OYO received US$ 810 million from Softbank, which was the largest start-up investment in 2019.

There were 111 large deals (value greater than US$ 100 million) recorded in 2019, accumulating to US$ 35.2 billion and accounting for 73 per cent of total PE/VC investments made in year compared to 81 large deals aggregating US$ 27.9 billion in previous year. The value and volume of large deals have been progressively increasing over the past four to five years.

Business News - The India Boom Factor

Grape exports surge
Exim News Service - Mumbai, January 22 Top
India closed its grape export season of 2018-19 with a 31 per cent rise in the shipment of the fruit to Europe, the most premium market. Exports to Russia, China and other destinations also increased by about 25 per cent to 30 per cent, as per a report.

India exported around 30 containers of grapes amounting to 402 tonnes to European markets in the Netherlands, the UK and Germany, the report added.

Tripura Special Economic Zone along Bangladesh border to benefit many sectors
India Seatrade News - January 20 Top
The Rs 1,550 crore (Rs.15.5 billion) special economic zone (SEZ), to be set up along the Bangladesh border in Tripura, would be a multi-sector SEZ and not just agro-based food processing SEZ, the official said here on Saturday.

The Centre has decided that all notified SEZs will be deemed to be a multi-sector SEZ.

"According to the previous notification, the proposed Tripura SEZ at Paschim Jalefa (near the India-Bangladesh border town of Sabroom) in south Tripura was to be agro-based food processing SEZ," said a Tripura Industries and Commerce Department official.

The SEZ is expected to open new avenues and attract private investment across sectors considering its proximity to Bangladesh's Chittagong international seaport.

A bridge - Maitri Setu - is under construction across the Feni river near the proposed SEZ. On completion by April, it will connect Tripura with southeast Bangladesh and facilitate transportation of goods to the Chittagong port, which is around 70 km from Sabroom.

The official said the SEZ, to be developed by the Tripura Industrial Development Corp, could create 12,000 skilled jobs. Rubber-based industries, textile and apparel units, bamboo and agri-food processing industries will be set up in the SEZ.

"The Centre will allow 100 per cent income tax exemption on exports for SEZ units under Section 10AA of the Income Tax Act for the first five years. Exemptions from the Goods and Services Tax (GST) and supplies to SEZs will be zero under IGST Act," he said.

Addressing an event, Tripura Chief Minister Biplab Kumar Deb said on the request of the state government, the Centre decided to set up the SEZ with an aim to attract Bangladeshi investors. They could set up tea and rubber-based industries in the SEZ, he said.

The state would get sincere support from Bangladesh Prime Minister Sheikh Hasina, slated to visit Tripura in February, he said.

The Chief Minister said 25 acres of land had been acquired for the SEZ.

At an expenditure of Rs 1,150 crore (Rs.11.5 Billion), the Northeast Frontier Railway (NFR) has extended railway lines up to two bordering sub-divisional towns of Sabroom and Belonia.

The government-owned IRCON International has also been laying 12.23 km rail at a cost of Rs 972 crore (Rs.9.7 billion) to link Agartala with the Bangladeshi railway network at Akhaura. The Agartala-Akhaura railway line would facilitate easier ferrying of goods.

Also, the journey distance between Agartala and Kolkata, via Bangladesh, will come down by a third, from 1,613 km through mountainous terrain via Meghalaya and Assam, to 514 km.

New Onion crop arrival: Govt mulls lifting ban on exports
Daily Shipping Times - New Delhi- January 23 Top
Apprehending a glut in onion supplies in a month from now, and a possible crash in mandi prices, which can potentially hit the farmers, the Commerce Ministry has started consultations with the Ministries of Agriculture and Consumer Affairs to lift the ban on export of the vegetable. The ban came into effect on September 30 last year, amid spiralling onion prices.

There has been 22-56% fall in the retail prices of onion in the four metros - Delhi, Mumbai, Kolkata and Chennai - in the past 20 days. Onion prices were Rs 52/kg in Delhi, Rs 70 in Mumbai, Rs 50 in Chennai and Rs 40 in Kolkata

on January 20, says Consumer Affairs Ministry data. The prices were as high as Rs 150-200/kg in the November-December period.

The export restriction is aimed at increasing the availability of the edible bulb in the domestic market and contain the price rise. The Government has also imposed stock limits on traders and has asked state-run trading firm MMTC to import about 36,000 tonne of onion.

India had exported onions worth about $115 million in the August-September period while the shipments were $154.5 million during the first four months of FY20. The exports were to the tune of $496.82 million in 2018-19.

Passenger vehicle exports rise 6 per cent in April-Dec; Hyundai, Ford lead the pack
IBEF - January 21 Top
In first nine months of the current fiscal year, exports of passenger vehicle (PV) from India increased by 5.89 per cent where Hyundai Motor lead the segment with dispatches of around 1.45 lakh units, according to the latest data by SIAM. During April-December 2019, PV exports stood at 5,40,384 units as compared with 5,10,305 units in the same period of 2018-19.

Car shipments witnessed a growth of 4.44 per cent at 4,04,552 units, while utility vehicle exports increased by 11.14 per cent at 1,33,511 units during the April-December period, as per the data by Society of Indian Automobile Manufacturer.

Although, there was decline in exports of vans by 17.4 per cent at 2,321 units during the period under review as compared with 2,810 units in the same period last fiscal.

The segment was led by Hyundai Motor India Ltd (HMIL), followed by Ford India and Maruti Suzuki India (MSI) at the second and third positions, respectively.

During the period, HMIL, the South Korean automaker exported 1,44,982 units to overseas markets, up 15.17 per cent over the same period last fiscal. It exports vehicles to over 90 countries across Africa, Middle East, Latin America, Australia and Asia Pacific.

"With cumulative sales of 1,44,982 units and a market share of 26.8 per cent from April-December, Hyundai has once again maintained its leadership position in the exports market with its super performer brands," Hyundai Motor India MD and CEO Mr S S Kim said.

He further added that the company intends to keep this positive momentum in 2020 also with more world-class products adding meaningful moments for its global customers.

Though, during the review period, Ford India's export stood at 1,06,084 units, down 12.57 per cent from a year-ago period whereas, domestic car market leader MSI exported 75,948 units across global markets, down 1.7 per cent from same period last year.

Nissan Motor India witnessed a growth by 39.97 per cent from same period last fiscal with 60,739 units shipped out during April-December 2019. Similarly, General Motors India, which has earlier ended selling vehicles in the domestic market, exported 54,863 units during the period.

During April-December 2019, Volkswagen India exported 47,021 units, followed by Kia Motors India which exported 12,496 units. Renault India dispatched 12,096 units during the same period.

During the review period, home-grown auto major Mahindra & Mahindra exported 10,017 units, while Toyota Kirloskar Motor dispatched 8,422 units and Honda Cars India exported 3,316 units to global markets.

Other notable exporting companies during the period included FCA India and Tata Motors with 2,391 and 1,842 units, respectively.

Shipping News

Terminal handling charges to be paid directly to port trusts
India Seatrade News - January 20 Top
The Centre has allowed direct port delivery (DPD) clients and authorised economic operators (AEO) to pay terminal handling charges (THC) directly to the port terminals in a move that drastically alters the way the levy is collected.

The move is expected to end years of tussle between shipping lines and importers/exporters over the issue.

The decision, according to the Central Board of Indirect Taxes & Customs (CBIC), will improve the ease of doing business and save thousands of crores to the trade and industry.

Bill of Lading

In container trade, THC is currently levied by the port terminals on the shipping lines for services such as unloading cargo containers from the ship and carting them to the storage yard in case of imports and vice versa for exports. Lines, in turn, recover this amount from the importers/exporters as an extra charge over and above the ocean freight. The Bill of Lading - a contract between the line and a customer - demarcates the ocean freight and local charges such as THC and for delivering the container at the container freight station or inland container depot.

The trade (importers/exporters) have been accusing the lines of recovering THC charges higher than what the lines pay to the terminals to clear the containers. In short, they claim the recovery is not on an exact back-to-back basis, but with a mark-up.

In early 2000, the Tariff Authority for Major Ports (TAMP), tried to regulate the THC levied by the shipping lines from the trade, against which the lines went to court arguing that the rate regulator had no jurisdiction over the rates collected by the lines outside the port area.

"It appears that shipping lines are charging excessive charges as terminal handling charges than what the terminals are charging for clearance of containers. This should immediately be changed to facilitate ease of doing business," John Joseph, Chairman, CBIC, wrote in a January 13 communication to all principal chief commissioners/chief commissioners of Customs.

Direct payment

"As an immediate measure, trade notice/public notice may be issued in all Custom Houses under your charge to see that DPD clients and AEO clients are permitted to pay terminal charges directly to the terminals and this should be followed in letter and spirit," Joseph wrote in the letter.

"This will actually save almost Rs 5,000 to Rs 10,000 per container as can be seen from the complaints received in my office. Since India is having a traffic of almost one crore (10 million) containers, this will be a substantial gain to the industry and trade," Joseph, who was instrumental in introducing the DPD programme during his tenure as chief commissioner of Customs, Mumbai Zone II, added.

"The total freight from where the shipping line work starts to where it ends should be one cost, including the THC, but what they were doing is having separate heads while quoting to the exporters and importers; there was no transparency," said TS Ahluwalia, President, Northern India Shippers Association.

Shipping industry sources said that the new initiative will require changes to the Bill of Lading to make it "free-in, free-out" of containers, excluding THC, for smooth enforcement.

Lines' reaction

Shipping lines say they have been made the fall guy in the government's bid to reduce logistics costs.

"For a shipping line coming to Jawaharlal Nehru Port Trust (JNPT), we are paying $160,000 as vessel-related charges per call. It is very high compared with other parts of the world. Nobody is questioning that. For customers, the criminal is the shipping line and the terminals are like saints. Somebody should question why they are charging so much. If the government is trying to reduce the costs, then why are these charges not reduced, why only the shipping line is blamed every time," said an executive with a Europe-based container line.

Trade sources said that the new arrangement should be extended to all and not just to some 2,000 DPD and AEO clients, who form only 10 per cent of the total trade, particularly at JNPT, India's busiest container gateway, to be effective.

"You cannot do it on a piecemeal basis for 10 per cent of customers and exclude the balance 90 per cent. If you want to make a policy, do it for everybody," a trade source said.

Logistics News

'Madhya Pradesh to become India's Warehousing Hub'
India Seatrade News - January 24 Top
Chief Minister Kamal Nath has said that Madhya Pradesh will soon emerge as India's Warehousing Hub. Since, Madhya Pradesh is geographically located at the center of the country, it will develop into a Logistics Hub in the near future. This will help the State become Warehousing Hub. He sought active participation of prospective investors. On the second day of the annual meeting of the World Economic Forum at Davos, the globally renowned industrialists and investors discussed with Chief Minister about their investment plans in allied emerging sectors of information technology, hospitality and tourism in Madhya Pradesh. The investors expressed confidence in the leadership and vision of CM Kamal Nath and said that Madhya Pradesh will soon become an economic force.

Antonio Neri, President & CEO of Hewlett Packard Enterprise Division, Magesvaran Suranjan, President of Procter & Gamble Asia Pacific, Middle East Africa, Abidali Neemuchwala, CEO & Managing Director of Wipro, Ahmed bin Saeed Al Maktoum Chairman and CEO of Emeritus Airlines, Dr. Shamsheer Vayalil President & Managing Director of VPS Health Care Group, 2000 W Founder Andreas Bilkert had one-to-one discussion with the Chief Minister. Chief Minister discussed topics related to setting up a data center, hardware manufacturing and setting up an IT park with Antonio Neri, President and CEO of Hewlett Packard Enterprise Division. Neri talked about hardware manufacturing and IT service operations at IT Park in Madhya Pradesh.

Chief Minister said that the Madhya Pradesh is a peaceful state and has the most favorable environment for investment in the IT sector as there is a large number of talented young IT professionals available here.Wipro Limited CEO Abidali Neemuchwala discussed with the Chief Minister on the scope of setting up Information Technology Services Units and Parks. Expressing confidence in the leadership of Kamal Nath, he underlined the investment potential in information technology sector. President of the Inter Continental Hotels Group (IHG), Patrick Cescau and CEO Keith Barr expressed their willingness to invest underlining the prospects of the hospitality industry. He discussed with the Chief Minister about a number of issues mainly setting up the world class resorts in wildlife tourism area and construction of heritage hotels at major tourist destinations.

Despite near-flat absorption in 2019, demand for warehousing on the rise in Bengal
India Seatrade News - January 22 Top
Realty firm Hiranandani Group recently announced that it was entering into an equal joint venture with global investment firm Blackstone to develop industrial and warehousing assets. The JV will invest ₹2,500 crore (Rs.25 billion) over the next four years and it will include plots by Hiranandani Green Base's 267 acres in Pune, 115 acres in Chennia, 73 acres in Nashik and around 25 acres in Durgapur (West Bengal).

The Hiranandanis are not the only ones to target warehousing space here in Kolkata and its peripheries. It is being said that approximately 2.5 - 3 million sq ft of warehouse space is likely to come up across Bengal in the next 18-36 months at an approximate investment of ₹750 crore (Rs.7.5 billion). In fact, Bengal saw warehouse space absorption of 3.5 million sq ft in 2018; and a similar 3.5 million sq ft of absorption again in 2019, sources say.

"Most warehouses find occupancies within six months and a major chunk of this demand is now coming from e-commerce companies," said Swapan Dutta, Senior Management, Knight Frank (India) Pvt Ltd, a real estate consultancy firm.

According to a report by property consulting firm Savills India, warehouse absorption stood at 3.3 million sq ft in 2019, a tad lower than the 3.4 million sq ft absorbed in 2018.

The report further states that nearly 30 per cent of the absorption was by e-commerce firms, another 26 per cent by 3PL (third-party logistics) and distribution players, 15 per cent by electronics firms and another 12 per cent by FMCG firms. Pharma and auto ancillary companies constituted the other major buyers.


A number of global PE funds and developers such as Morgan Stanley, ESR (backed by Warburg Pincus), Allcargo Logistics, Indospace, and Embassy, among others, are said to be in different stages of discussions across suburbs that are located some 30-50 km away from the city. Regional players like Srijan and the Jalans are also investing to set up warehouse infrastructure across these places.

According to Srinivas N, Managing Director, Industrial, Warehousing & Logistics, Savills India, the city and the eastern region were previously serviced from Hyderabad (Andhra Pradesh) or Delhi. But as connectivity improves, and the north eastern and eastern India markets open up, there is rising demand for infrastructure addition around Kolkata and the periphery to service these markets.

Savills has predicted that warehousing and manufacturing absorption will be to the tune of 3.5 million sq ft in 2020 and around the same number in 2021 and 2022.

"Opening up of markets in eastern India, improved focus and infra addition in North East along with better connectivity with the rest of India have seen rising demand for warehouses around Kolkata's periphery," he told.

Growing demand

Peripheral areas such as NH-2 ? which covers Delhi Road, Old Delhi Road, Dankuni ? or areas around NH-6 that include places like Dhulagarh, Satraganchi and Uluberia have seen highest traction. Nearly 87 per cent of warehouse space absorption for 2019 happened across these locations.

In the northern peripheries, which saw 3 per cent absorption, land along the Kalyani Expressway, Barasaat and BT Road are said to be in demand.

Better connectivity through these road stretches ? be with north India, eastwards or in the North East ? are seen to be major drivers.

Naturally, land which has proximity to the highways has seen a 30 per cent appreciation over the last four years, compared to the other plots where appreciation is to the tune of 10 per cent.

"As land along the highways are taken up, there will be appreciation of other plots that are slightly off the main roads," Srinivas said.

New growth areas

Incidentally, growing focus on inland waterways and other port-led development is also pushing up demand for warehousing, specially in the southern peripheries. This has led to growth around the port area, Budge Budge Trunk Road and areas on Diamond Harbour Road. Approximately, 10 per cent of the absorption in 2019 happened in these areas, the report says.

However, limited space and high land prices continue to be impediments here.

Direct connectivity to Kolkata Port, ease in in-city distribution to southern parts and government initiatives to improve inland waterways have helped, the report further added.

500 km of DFC completed; aiming for 991 km by March 2020
Exim News Service - New Delhi, Jan. 20 Top
The 14th Foundation Day of Dedicated Freight Corridor Corporation of India (DFCCIL) was celebrated at a function in New Delhi on January 18, 2020. Speaking on the occasion, Minister of Railways and Commerce and Industry, Mr Piyush Goyal, congratulated team DFCCIL for completing 500 km of Dedicated Freight Corridor (DFC) and exhorted the team to achieve the goal of 991 km by March 2020. He said that DFC has the impact to transform the rail sector. It is necessary to have separate tracks for freight and for passengers to ensure faster movement of both, he stressed.

Mr Goyal said that Indian Railways should run freight trains in convoys for maximum utilisation of the path and for increasing the average speed of the trains. Just like IRCTC, which pays compensation for delays in its Tejas trains, Railways' freight customers should be compensated for late arrival of goods trains. He emphasised on the running of time-tabled goods trains on DFCCIL.

Mr Vinod Kumar Yadav, Chairman, Railway Board and Chairman DFCCIL, enunciated that consolidation, growth and reforms are the three crucial areas which Indian Railways is working on. He said that dedicated freight corridors are ushering in a paradigm change in Indian Railways and asserted that DFCCIL will play a significant role in shaping the Indian economy. He added that the Railways is upgrading its network, especially the Delhi-Mumbai and Delhi-Howrah sectors for running faster and modern trains. He further emphasised that by having acquired 98.5 per cent of the required land, DFCCIL is on the fast track to project completion.

Mr Anurag Sachan, MD, DFCCIL, while addressing the gathering, profusely recognised the dynamic leadership and continuous support of Mr Goyal. He also assured that team DFCCIL will work hard to complete the project on time.

At the awards ceremony on the occasion, 28 individual awards and 4 group awards were given. The running shield for the Western Corridor was given jointly to the Ajmer and Ahmedabad units, while for the Eastern Corridor it was given to the Pt Deendayal Upadhayaya (Mughalsarai) unit.

Coastal Containers to move now via Vallarpadam Rail Link
Daily Shipping Times - Kochi, January 24 Top
The Vallarpadam rail link, constructed exclusively for transporting containers to and from the International Container Transshipment Terminal (ICTT) here, had never been utilised to its fullest ever since its commissioning in February 2011.However, things took a turn for the better for the 4.62km-long bridge with the launch of the train service of coastal containers from Concor-Vallarpadam to ICD-Whitefield in Bengaluru.

Rejo Peter, the Terminal Manager of Concor, said the service through the link, which was the longest rail bridge in the Country until recently, was launched in association with DP World.

"Until now, containers were moved via road and the rail link remained under-utilised even though transporting containers via rail route is more economical," he said.

The lukewarm response of customers also didn't help matters, he said.

Now, Concor has decided to go all out in promoting the use of the Railways' freight service, said Rejo. "We are planning rigorous marketing programmes.

We would like to highlight to prospective customers the fact that railways' freight service is more economical than road transport," said Rejo, adding, "Rather than concentrating on revenue, we, at present, want to build the market and make it a regular thing."

The railways too is all gung-ho.

An official said the service is being operated using the freight container rake. "Each rake will be able to transport 40 containers between Vallarpadam and Whitefield," he said.

Recalling how a few services were operated since the bridge's commissioning, the official said,

"The train services were stopped after Concor didn't find the route economical. Services were being conducted once or twice a month."

Indian Port News

GSPC LNG terminal at Mundra Port goes onstream; 3rd facility in Gujarat
India Seatrade News - January 23 Top
The Mundra port on Wednesday berthed its first Liquified Natural Gas (LNG) cargo at its terminal, multiple sources informed. This marks the commissioning of the India's fifth and Gujarat's third LNG terminal, which is jointly developed by Gujarat Government-run companies and Adani Group, through GSPC LNG Limited, an SPV.

Neither the government nor the co-promoter Adani's officially made an announcement with regards to the achievement of this major milestone. The sources in the know confirmed that a 140,000-tonne LNG cargo from Qatar Gas arrived on Wednesday morning at Mundra LNG terminal.

"The terminal will soon be functional with initial operational capacity of about 1.5-2 MTPA," informed a source privy to the development. The LNG received at the terminal would be supplied to Gujarat State Petronet Ltd's pipeline to feed it into the market.

Queries sent to Adani Group remained unanswered till the time of print.

The existing operational LNG terminals in Gujarat include Petronet LNG's 17.5 MTPA terminal at Dahej and 5.2-MTPA terminal at Hazira by Hazira LNG Pvt Ltd, an arm of Shell Gas B.V.

As per the Union Petroleum Ministry's website data, there are currently six operational LNG regassification terminals operational with capacity of about 38.8 MMTPA. Apart from the three in Gujarat, two are operational at Kochi and one at Ennore in Tamil Nadu.

The Mundra terminal was inaugurated in October 2018 by the Prime Minister Narendra Modi, but commercial operations couldn't start till now. Insiders claim a dispute between the promoters had delayed the berthing of the cargo. Interestingly, last year another LNG cargo for commissioning was not allowed to berth due to differences between the promoters.

The terminal built with a total cost of approx ₹5,000 crore (Rs.50 billion) has a total 5 million metric tonnes per annum (MTPA) capacity for storage of LNG and sale of re-gassified LNG.

The State owns 75 per cent through different state government companies including the petroleum giant, Gujarat State Petroleum Corporation (GSPC), ports regulator Gujarat Maritime Board among others, and the remaining 25 per cent is held by Adani Group.

VPT moots international trade hub near airport
India Seatrade News - January 23 Top
A free trade and warehousing zone (FTWZ) has been proposed to be set up by the Visakhapatnam Port Trust near the port exim park near the airport. The FTWZ, which will be spread across 106 acres, will be considered a special economic zone governed under the 2001 SEZ Act and SEZ rules, 2006.

"The project will cost around Rs 500 crore (Rs.5 billion), most of which is expected to be funded by the VPT and Sagarmala Development Corporation Ltd (SDCL). A draft DPR for the same was prepared by the Indian Ports Association on January 2," a senior port official said.

VPT deputy chairman PL Haranadh confirmed the development. "We have already formulated a DPR, and a SPV will be formulated a DPR, and a SPV will be formed soon. Once that happens, we can fix a timeline for the project," he told.

FTWZ is designated as a deemed foreign territory and is envisaged to be integrated zones to be used as international trading hubs. FTWZ status allows units to provide value added services to customers including packing, re-packing, labelling, knitting and bundling among other services. Thus, the zones could act as consolidation or distribution hubs for foreign and Indian clients alike.

As per the initial blueprint, land utilisation has been divided into three parts: Processing zone, non-processing zone and infrastructure-related land in the ratio of 69:12:19, an official said.

"Processing zone would primarily include warehousing zones of various kinds. The infrastructure zone would have roads and drainage facilities. The non-processing zone will comprise facilities such as power, fire, restrooms, green belt, truck terminal, office space and miscellaneous functions," the officer added.

SDCL is expected to invest around Rs 240 crore (Rs.2.4 billion) towards infrastructure and other work related to the project. Both VPT and SDCL will form an special purpose vehicle (SPV) which will invest around Rs 110 crore (Rs.1.1 billion) to run the facility and retain earnings from the project. The cost of land provided by VPT is Rs 150 crore (Rs.1.5 billion).

"As per proposal, road shows and awareness campaigns will be conducted to pick up the demand of the FTWZ. It's animportant project because the region lacks any facility of this nature," an official pointed out.

Gujarat Maritime Board plans ₹1,750 crore (Rs.17.5 billion) brownfield port at Bhavnagar via Swiss Challenge Route
India Seatrade News - January 22 Top
The Gujarat Maritime Board plans to develop a brownfield port at Bhavnagar at a cost of over ₹1,750 crore (RS.17.5 billion) under the Swiss Challenge Route (SCR). Though the SCR has been in discussion for nearly a decade, this is only the second port development to be taken up by this method, after GMR Infrastructure bagged a greenfield commercial port project near Kakinada in Andhra Pradesh. While SCR allows innovation, the traditional way of awarding tenders through global bids is still the most favoured by investors in the port sector, feel experts.

The Gujarat Maritime Board had received a proposal from Foresight & Padmanabh Mafatlal Consortium to develop a CNG terminal and other cargo terminals at Bhavnagar port under the Build, Own, Operate, and Transfer (BOOT) Policy. Its board, in October 2019, recommended inviting bids under the SCR.

SCR is a lesser-known and lesser-used method of bidding. It is not popular, as it can be problematic. The challengers make the bids on terms different from the proposer, and hence, it is not a like-for-like situation. No port project in India has been bid by this method. In undivided Andhra Pradesh, the government had called for bids for some infrastructure projects by this method, but it was not entirely successful, said an industry source.

For example, the Metro Manila airport project bid by this method ran into legal problems and was eventually awarded to the challenger, he added.

In the Indian port sector, the most popular method is a two-stage process. The first is Request for Qualification, wherein the bidders seek qualification against the set out technical and financial qualification criteria. The second is the qualified bidders submitting their bids and whoever quotes the highest revenue share or royalty depending on what that particular bid requires, being awarded the contract. This is a process that minimises any scope for subjectivity by the evaluators, the source said.

SCR can result in lesser time for awarding the project, and prospect of optimum utilisation of resources. However, there are high chances of litigations due to lack of homogeneity in proposals and possible allegations of favouritism in award, said K Ravichandran, Senior Vice President, ICRA, who tracks the port sector.

Under SCR, a company with an innovative idea to develop an infrastructure project submits a proposal on a suo moto basis to the project authority of the State or the Central ministry. Upon being satisfied with the project's feasibility, the authority then decides to throw open the same project to other interested parties with better ideas to develop the project. These proposals are evaluated by a committee, which selects the best among them. The original proponent is given an option to match the best bid if its original proposal was not the best option, he said.

Some of the projects awarded/being awarded include Amravati city development project in Andhra Pradesh; a floating storage and regasification unit project in Gujarat and railway station redevelopment projects under the Ministry of Railways.

SCR is only a way of selecting the bidder. Once a bidder is finalised either on SCR or by any normal method like inviting global bids, the execution of the project can be on BOOT or Design, Build, Finance, Operate and Transfer (DBFOT) basis, said R Ravi Kumar, Secretary General, Indian Private Ports & Terminals Association.

It is reported that in the port sector, the governments of AP, Odisha, Tamil Nadu and Gujarat have followed this route for some of their projects. In the major ports in India, this method does not seem to have been favoured. Although SCR is the favourite of some of the state governments, the method is not as transparent as a BOT/BOOT, said Kumar.

V.O.C Port breaks its own record, handles vessel with highest parcel size
India Seatrade News - January 21 Top
V.O. Chidambaranar Port has surpassed its previous record for handling a vessel with highest parcel size.

The Panama flagged vessel 'MV Elettra' with the length of 254.52 metres, beam of 43 metres and draft of 12.23 metres arrived from the Port of Mina Saqr, United Arab Emirates with 93,353 tonnes of limestone consigned for India Cements Limited and Eastern Bulk Trading & Shipping Private Limited.

The vessel, berthed at 9th berth, commenced its discharge using three harbour mobile cranes capable of discharging 50,000 tonnes per day. The entire consignment is expected to be completed by 6 p.m. Tuesday (January 21). The shipping agents for the vessel is M/s. Seaport Shipping Private Limited, Thoothukudi and Stevedore is M/s. Seaport Logistics Private Limited, Thoothukudi.

Previously, the highest parcel size vessel 'MV NBA Vermeer' with 89,777 tonnes of coal was handled at the port on last September.

It is pertinent that during this financial year up to December 2019, the Port has handled 9.55 lakh tonnes of limestone as against 7.22 lakh tonnes handled during the corresponding period of previous year.

"Underpinned with deep draft berths, operational efficiency, excellent cargo evacuation infrastructure and enhanced asset utilisation, the Port will continue to deliver the best and safest port services in the region. On this occasion of achieving this significant milestone, I would like to recognize the hard work and commitment of shipping agents, stevedores, harbour mobile crane operator, officers and staff of V.O. Chidambaranar Port," T.K. Ramachandran, Chairman, V.O. Chidambaranar Port Trust, said in a statement.

Kamarajar Port to set up port-related industries at ₹70 crore (Rs.700 million)
India Seatrade News - January 20 Top
Kamarajar Port Ltd. (KPL) will develop around 320 acres of land, at a cost of ₹70 crore (Rs.700 million), to set up port-related industries. Such port-led industrialisation will also help in providing employment opportunities.

Infrastructure, including roads, rail connectivity, warehousing, container terminals, truck parking, lighting, power supply and drainage, will be created by the port.

"We are looking at industries that require the port for imports or exports - for instance, palm oil processing units or lithium-based battery parts units. This will be like a special industrial park that has proximity to the port," explained KPL chairman and managing director Sunil Paliwal.

The project is being taken up under the Sagarmala programme, with the aim to reduce the cost of logistics and time for the movement of EXIM and domestic cargo, and development of port-proximate future industrial capacities near the coast is a step in this direction. A consultant has already prepared a master plan and business plan, after consultation with stakeholders. The consultant has identified industries such as pharmaceuticals, petrochemicals, electronics, engineering, automobile and non-metallic minerals.

The port currently awaits environmental clearance for the project, that proposes to tender and auction the land parcels for 60-year-long leases. "Such leases are usually for 30 years, but we have taken special permission from the Government of India for making the project more competitive," he added.

Of the 320 acres identified for the project, 187 acres will be land for industrial and logistics development. Rest of the area will be classified as non-processing area and be set aside for facilities, including roads, utilities and green space. The Kamarajar Port presently has eight operational berths, of which one is primarily used for the export of automobiles, and one exclusively for liquid natural gas imports.