Improvement in railways connectivity with focus on Vizag as a maritime hub on the east coast

Ports handle nearly 90% of the EXIM trade of the country by volume and are critical to enhance competitiveness of the country in the international trade. One of the key determinants for efficiency of Ports is evacuation and hinterland connectivity. An efficient evacuation system and seamless connectivity to the hinterland from the Port can substantially reduce the logistic costs for the trade which will enhance the competitiveness of India. The internal Rail Systems in Major Ports have evolved over the past five decades and are antiquated and need renewal. The 12 Major Ports have nearly 612 km of internal rail network. Though the Major Ports and Indian Railways have taken up many connectivity projects, there is an urgent need for focused attention and substantial allocation of resources. The Government is also keen on increasing the percentage of cargo being evacuated through rail from Major Ports which stands at 28% now.

“One of the major key issue at Visakhapatnam Port Trust is, severe constraints on the railway infrastructure and hinterland connectivity, which shipping sector greatly relies for cargo evacuation.” Mr. G.Sambasiva Rao, Managing Director, Sravan shipping Services Pvt ltd and Vice President – The Andhra Chamber of Commerce and Industry Federation.

He also said, the port, on an average, is getting around 10 rakes per day, which is grossly insufficient and resulting in the port getting choked. The government needs to understand that ports are only transit points and if cargo doesn't move then ports can't unload more cargo. When the port is growing, the faster evacuation facilities also have to be improved on larger scale. The government should take initiatives on a war footing basis to improve the operational efficiency at Major ports. Thrust has to be given for deepening the drafts so that larger vessels can be handled.

Realizing that these efforts would not bear fruit unless evacuation and connectivity are improved, the Ministry of Shipping has proposed to create a Special Purpose Vehicle (SPV) with an initial authorized capital of Rs. 500 crores, funded by all the twelve (12) Major Ports and Rail Vikas Nigam Limited (RVNL) manned by professionals with expertise on rail transport and port logistics for promoting port-led direct and Indirect development and to provide infrastructure to evacuate goods from ports quickly and efficiently. The SPV would work in close co-ordination with the Indian Railways and leverage the existing participative model of Indian Railways for enhancing the last mile connectivity to the Ports. It will result in substantial reduction in dwell time of the cargo in the Ports and bring down the overall logistic cost for the Trade.

The Major Ports have identified a shelf of nearly 40 Projects which includes the last mile connectivity Projects and internal Port Rail Projects which would require an estimated investment of Rs. 2,372 crores.


By GADAGOTTU SAMBASIVA RAO

The author is VP, The Andhra Chambers of commerce and Industry Federation