Monday, November 26, 2007

Tapping Vizhinjam’s potential

Tapping Vizhinjam’s potential

Vizhinjam can be developed as a mega container trans-shipment terminal, given its geographical location, natural deep water environment and comparatively much lower cost of approach channel maintenance.

Jose Paul

Recent reports suggest that the South Korean shipyard Samsung Heavy Industries is building the world’s largest container ship of 16,000 TEU with 20 per cent more capacity than the current largest container ships of 13,000 TEU. With a length of 400 metres, drawing a draught of 18 m when fully loaded, this behemoth is expected to begin regular service by 2011.
By that time, it is expected that about 200 giant container ships of 10,000 TEU capacity and above are likely to be in active service. These giant ships may draw a draught ranging from 15-18 m and they will be very selective in their port calls. Putting it in context
Concept designs for building even larger container ships are already on the drawing board and they may draw draught up to 20 metres. The attractiveness of Vizhinjam as a mega container trans-shipment terminal becomes relevant in this context. The current port development plans on the East and the West coasts of India do not seem to envisage a deep water port capable of permitting draught of 20 m or even more. Vizhinjam appears to be in a unique position in the extreme south-west coast of India, capable of providing such deep water within about just three km from the shore line.
Once a huge break water is constructed and one-time capital dredging is completed, in view of the relatively low littoral drift and natural deep water environment, the expenditure to be incurred on annual maintenance dredging to keep the access channel deep enough to permit ships drawing a draught of 20 m is reported to be comparatively insignificant.
The new container terminal that is coming up at Vallarpadam in Kochi is designed to permit container ships of 8,000 TEU drawing a draught of 14.5 m and in order to permit such vessels to enter the new terminal Cochin port will have to not only deepen but also widen the channel from 175 m to 280 m and lengthen it from 11 to 14 km.
On a rough estimate, the CPT will have to incur a maintenance dredging cost of at least about Rs 80 crore every year from the year 2010 when the new terminal becomes operational. The fact that Vizhinjam may be able to provide vessels drawing a draught of 20 m at less than one-fifth of the cost at Kochi is yet another attraction for Vizhinjam to emerge as a mega container trans-shipment terminal in the entire South Asian region.A strong case
One of the key requirements of any port to be developed as a container transshipment terminal is its geographical location. The most profitable route in international container shipping is the Asia- Europe route. All the present giant container ships, such as the Ebba Maersk, are deployed on this route and such ships generally load to full capacity in view of the booming trade with China. Since China and India are going to be the economic power houses to the world and the key manufacturing bases for America and the Europe, bigger and larger vessels are more likely to be deployed on this route.
Once these giant box ships leave the Chinese ports of Shanghai and Hong Kong the next port of call is Singapore and after Singapore there is no other Asian port where such super large container ships call at before they pass through the Suez Canal and reach the Mediterranean ports.
Vizhinjam, in close proximity of the international shipping route involving a diversion of just 20 nautical miles, could become a desirable stopover for such vessels before they proceed to transit the Suez. It is pertinent to bear in mind that the Government of Sri Lanka is putting its best efforts to take up construction of Colombo’s South Harbour project to make it the newest and the most competitive port in South Asia precisely to attract such giant container ships as an ideal transshipment base.
While Colombo’s South Harbour Project could possibly offer a draught of 18 m, Vizhinjam could still be ahead, offering deeper waters in a more competitive environment. International shipping companies will certainly factor in India’s fast growing economy and the consequent increase in trade volumes and also the fact that 80 per cent of all Colombo’s traffic is transshipped from Indian ports. The emergence of a mega port in Vizhinjam could result in such traffic not finding its way to Colombo but naturally to an Indian port.
Can a mega container transshipment terminal survive depending entirely on transshipment traffic?
While it would be desirable to have a local cargo base to ward off uncertainties in an environment of fluctuating traffic, there are ports that depend almost entirely on transshipment cargo. For the world’s 19th largest container port, namely Tanjung Pelepas in Malaysia, which handles 5 million TEU annually, transshipment traffic accounts for 94 per cent of its total cargo traffic. Other advantages too
The long list of attractions of Vizhinjam does not seem to stop with its favourable geographical location, natural deep water environment and comparatively much lower cost of channel maintenance.
Vizhinjam, being a minor port, falls under the maritime jurisdiction of the State of Kerala and also falls outside the jurisdiction of the Tariff Authority for major ports.
The private investor will have freedom to fix his tariff based on the competitive market environment. Most of the land required could be reclaimed from the sea, necessitating much less rehabilitation and relocation of the inhabitants. It being a greenfield environment, the investor will not be burdened with the takeover of existing labour and the attendant problems associated with such takeover.
The new image emerging of Kerala as an investor-friendly Government should also come as a refreshing contrast to a State that had received a lot of negative publicity. Kerala, with 100 per cent literacy, endowed with skilled manpower, has a huge number of technically trained personnel who are working at ports of the UAE and Malaysia. They would be willing to return home to organise a highly productive and efficient operating team.
To cap it all, the qualified info-tech personnel of Kerala could provide an excellent IT back-up and innovative operating and support systems. When all the favourable factors are properly harnessed it should be possible for the proposed mega container transshipment terminal at Vizhinjam to offer a service quality that is unparalleled, an operational efficiency that is unmatched and a port performance that is unequalled in any port of the world.(The author, a former Chairman, Mormugao Port Trust, is a visiting professor, Manipal University, Karnataka. drjospaul@rediffmail.com)

Thursday, September 13, 2007

Upcoming Gangavaram port

Upcoming Gangavaram port weans away top client from nearby Vizag
The private port is expected to eat into business of government-owned ports when it is operational next year
P. Manoj

Mumbai: A new private port, billed as India’s deepest, coming up at Gangavaram in Andhra Pradesh will start operations in April next year and has already poached a top customer from the rival Union government-owned Vizag port which is just 15km away.
The move will boost the new port’s ability to win more customers even before it is fully operational.
Gangavaram Port Ltd, a special purpose company floated by D. Venkata Satyanarayana Raju, the former co-founder of India’s fourth largest IT services firm Satyam Computer Services Ltd, has already signed a deal with the state-owned Rashtriya Ispat Nigam Ltd that runs the 3 million tonne (mt) capacity Vizag Steel Plant.
“We have signed a memorandum of understanding with Vizag Steel Plant for their import/export requirements,” said Pranav Choudhary, vice- president (finance), Gangavaram Port Ltd. Officials at Vizag Steel confirmed the decision.
Vizag Steel currently imports about 4mt a year of coking coal, limestone, thermal coal and other such raw materials for its steel plant through the Vizag port. The imports will rise to more than 6mt a year after the steel plant doubles its capacity to 6.3mt by October 2009. Vizag Steel also exports about one lakh tonnes of finished steel products to Sri Lanka, Thailand, Taiwan, the UAE and the US through the Vizag port.
This cargo will shift from Vizag port to Gangavaram port, thus eroding the business of the top ranking Union government-owned port. Vizag port handles the highest volume of cargo among all the 12 government-run ports in India. In the 12 months to March 2007, it handled 56.39mt of cargo out of a total traffic of 463.84mt.
“Gangavaram would be next door neighbour to Vizag Steel. We will build conveyors to take the imported raw materials directly to the plant, thus avoiding dependence on railways for moving the cargo from the port to the plant. This will also help cut the extra time and costs involved in hauling the cargo by rail from port to the plant,” Choudhary said. Because of the high level of mechanization in cargo handling, the port will help customers cut handling costs.
Being a port owned by the state government, the private operator of Gangavaram port is free to fix its own tariffs without consulting a regulator, whereas the rates for the 12 government-owned ports including Vizag are set by the Tariff Authority for Major Ports.
Gangavaram port would thus be able to fix competitive rates to lure customers away from Vizag port.
The new port will have a depth of 21m (the deepest among any Indian ports) and will be capable of handling super capesize vessels of up to 200,000 tonnes, helping users such as Vizag Steel to save on ocean freight costs. Capesize vessels can carry much larger volumes of dry bulk commodities such as steel, iron ore and coal.
“At this depth, Vizag Steel can bring their cargoes on capesize bulk carriers and achieve economies of scale since larger quantities of cargo can be transported at a time. This will lead to cheaper freight costs,” says T.V. Shanbhag, adviser with Mumbai-based shipping company Mercator Lines Ltd.
Vizag Steel currently ships raw materials on handymax carriers (that can load up to 50,000 tonnes) because the depth at Vizag port cannot accommodate bigger vessels. The inner harbour of Vizag port where most of its cargo handling berths are located has a depth of 11m.
Vizag port plans to deepen the inner harbour to 14m to accommodate panamax carriers that can typically carry 73,000-75,000 tonnes of dry bulk commodities. Still, it would be nowhere near the new port in terms of depth.
Gangavaram port is being developed in three phases with a capacity to handle 100mt of cargo when fully operational. The 35mt capacity, phase one development comprises five berths, one each for handling coal and iron ore and three multi-purpose berths for handling other bulk and general cargo.
A consortium of 13 banks led by State Bank of India has lent Rs1,170 crore to Gangavaram Port Ltd for funding the phase one development.
D.V.S Raju, who was also founder-chairman of Hyderabad-based IT services firm VisualSoft Technologies Ltd, has roped in the Dubai-government owned port operator DP World to develop and operate the port for a 30-year period.
Fearing that the development of Gangavaram would harm the prospects of Vizag port, the Union shipping ministry had earlier proposed a joint venture between Vizag port and the private operator of Gangavaram port.
But this was rejected by the previous Andhra Pradesh government headed by N. Chandrababu Naidu.
Naidu’s Telugu Desam Party (TDP) was a key constituent of the then ruling National Democratic Alliance government at the Centre. The NDA government also agreed to transfer about 1,400 acres of land belonging to the state-owned Rashtriya Ispat Nigam Ltd for developing the new port.
Vizag is the industrial nerve centre of Andhra Pradesh and is regarded as the gateway for trade with China and the Asean region

Reliance looking for specialist container terminal operator

Reliance looking for specialist container terminal operator

When fully operational, the Rewas port will have 70 berths with a capacity to handle 457mt of cargo
P. Manoj
Mumbai: Mukesh Ambani-owned Reliance Industries Ltd will hire a global container ­terminal operator for its planned 2.6 million twenty-foot equivalent units (teu) a year facility at the Rewas port in Maharashtra.
A teu is the standard size of a container and is a common measure of capacity in the container business.
“We don’t have expertise in running container terminals,” said K.V. Natarajan, president, Rewas Ports Ltd. “Hence, we plan to have a strategic alliance with a global specialist in running container terminals or a container shipping firm and have started a dialogue in that direction.” He declined to elaborate.
Rewas Ports, which is 65% owned by various group companies operating under Reliance Industries, is building an all-weather deep draught (depth) port just 10km south of the central-government owned Jawaharlal Nehru Port, India’s busiest container port.
Amma Lines Ltd holds a 24% stake in Rewas Ports, while the balance 11% equity is owned by Maharashtra Maritime Board, the maritime regulator that oversees the development of ports owned by the state government.
Rewas port will be built in three phases. The first phase development costing Rs5,114 crore will involve 10 cargo handling berths with a capacity to handle 55 million tonnes (mt) of cargo. The new port will start operations on a 50-year contract beginning October 2010.
Since it is a port owned by the state government, Rewas Ports will be free to fix its own tariffs without consulting a regulator. However, the tariffs for cargo handling services at the 12 Union government-owned ports are set by the Tariff Authority for Major Ports.
When fully operational by 2040, Rewas port will have 70 berths with a capacity to handle 457mt of cargo, which is almost equal to the total cargo handled at the 12 Union government ports in the country.
These 12 ports handled 464mt of cargo in the 12 months to March 2007, compared with a capacity of 508mt.
Natarajan said that Rewas Ports will float global tenders in September to award the dredging work at the port that is estimated to cost about Rs1,800 crore.
The port will have a depth of 14.5 metres to start with and this will be increased to 20 metres in a phased manner.
The dredging contract at Rewas will be the biggest of such work ever executed in the country, bigger than the dredging work for the Sethusamudram ship channel project. It involves dredging 120 million cubic metres of stone, mud, sand and silt from the seabed.
A consortium of banks led by ICICI Bank Ltd has agreed to lend about Rs3,400 crore for the phase one development of the port, Natarajan said.
According to the union shipping ministry, the container cargo traffic at Indian ports is expected to grow to 12.5 million teu by 2011-12. Of this, 93% or 11.7 million teu are expected to be handled by the 12 Union government-owned ports.
The balance would be handled at ports owned by the state governments and which are being developed with private investments such as Rewas, Mundra, Pipavav, Hazira, Gangavaram, Pondicherry, Vizhinjam, Vijaydurg and Dighi, among others

Friday, September 7, 2007

Vizhinjam terminal in three years: Minister

Vizhinjam terminal in three years: Minister
Special Correspondent
THIRUVANANTHAPURAM: Work on the first phase of the Vizhinjam international container transhipment terminal will be completed in three years, Law Minister M. Vijayakumar has said.
Replying to questions in the Assembly on Friday, Mr.Vijayakumar said construction of the terminal was estimated to cost Rs.5,348 crore. The first phase was expected to cost Rs.2,390 crore. As many as 23 companies, including six foreign companies, secured tender forms for the project. The tender would be finalised in December, he said.

Tuesday, September 4, 2007

Vizhinjam global tender receives 21 bidders

Vizhinjam global tender receives 21 bidders
Thiruvananthapuram, Sep 3:

Kerala Ports Minister M Vijayakumar today said as many as 21 tenders have been received from international companies for the proposed deep-sea container terminal at Vizhinjam, near here, for which the state government had floated a global tender.
Speaking at the inaugural function of dredging of the Vizhinjam harbour as part of the terminal's development works, the minister said six harbours among the 17 in the state would be developed in the first phase. ''The state's development lays in the development of ports,'' he noted.There was good response for the global tender and the evaluation of the bid would be completed by this month. Earlier, Mr Vijayakumar had said after security clearance in October, licence would be given to successful bidder in November and the construction would start in December 2008.
--- UNI

Dredging work at Vizhinjam fishing harbour begins


Dredging work at Vizhinjam fishing harbour begins
Special Correspondent
Silt and garbage have raised the sea bed by a metre


THIRUVANANTHAPURAM: The Ports Department on Monday launched a short-term project to deepen the sea bed at the Vizhinjam fishing harbour, to provide safe berthing for cargo ships and tourist liners.
The basin inside the breakwaters is being dredged to its original depth of 5.5 metres. Ports officials said silt and accumulation of the waste dumped by fishing boats had raised the seabed in the harbour by one metre over a period of time. The basin would be dredged along a channel 100 m long and 50 m wide near the wharf for ships to berth safely.
A dredger, TSD Sindhuraj, belonging to the Kerala State Maritime Development Corporation has been pressed into service. It will remove 5,000 cubic metres of clay and sand from the seabed in an operation expected to last a week. The project is estimated to cost Rs.5 lakhs.
The trailer suction dredger is equipped with a tail-end nozzle and a hose to suck up the clay-sand mixture. The mixture is stored in a hopper tank of 200 cubic metre capacity. Once the tank is full, the vessel will head to the open sea to dump the mixture in deep waters.
Ports Officer Hari Achutha Warrier said that during the operation, 25 to 30 loads would be emptied in sea. Dredging would commence on Tuesday after removing fishing boats from the harbour area.
Minister for Ports M. Vijayakumar inaugurated the dredging project at the wharf on Monday morning. Ports Secretary L. Radhakrishnan presided over the inaugural function. District Collector N. Ayyappan, managing director of the Maritime Development Corporation K.K. Rajendran, Vizhinjam gram panchayat president Asuntha Mohan, Matsyafed chairman Pulluvila Stanley, Ports director Captain Vijayan Pillai and Mr. Warrier were present on the occasion.
The Vizhinjam fishing harbour currently handles general cargo ships mostly exporting goods to Maldives. Tourist liners also make an occasional call here.
Mr. Warrier said the reduced draft inside the harbour had made it impossible for bigger ships to approach the wharf, except during high tide.
“Deepening the harbour will make it possible for these vessels to come in any time. Periodic dredging during the post- monsoon period may become necessary,” he added.

Monday, August 27, 2007

Article written-by-a-15-year-old-korean-boy-who-visited-nepal

Nepalese complain about the caste system and corrupt officers. They openly vent their anger against the government. But have they ever thought About Nepal’s real problems? I believe that they have not. I want to say that Nepal’s real problems are lack of patriotism among the people and lack of love for one another. This is the conclusion I have reached during my stay. This summer, I did voluntary work from July 5 to July 30 at FHI Ever Vision School, Matatirtha, Kathmandu.
Let me first tell you about my country, Korea. This might help you understand my point. Just after the Korean War, which claimed lives of more than 5 million Koreans, Korea was one of the poorest countries in the world. Without natural resources, Korea had no choice but to desperately struggle for its survival by all means. Under this gloomy situation, Koreans envied other Asian countries like Japan, Taiwan, and Nepal. Korean government officials were horribly corrupt. With the dual classes of Yang ban (nobles) and angnom (peasants), Korean society was sickening day by day. However, Koreans, having determination to become rich, overcame the unfair social structure and put the country onto the track of development. When the former president Park Jung Hee took over the government, there were few factories in Korea. Korea could not attract loans or expect foreign investments. Under these circumstances, President Park ‘exported’ miners and nurses to then West Germany . The salaries that they earned were used to building factories and promoting industrialization of Korea. In 1964, when President Park visited then West Germany, the miners and nurses asked the president when the Koreans would become rich. The president replied, crying with the miners and nurses, that someday the Koreans would become rich. Many of Korean scientists and engineers, who could just enjoy comfortable lives in the United States, returned to Korea with only one thing in their mind: the determination to make Korea the most powerful and prosperous country in the world. They did their best even though their salaries were much less than what they would have received in other countries.
The Koreans believed that they have the ability to change their desperate situation and that they must make the country better, not only for themselves but also for the future generations yet to come. My parents’ generation sacrificed themselves for their families and the country. They worked 14 hours a day, and risked their lives working under inhumane conditions. The mothers, who went to work in factories, fed their babies while operating machines in dangerous environments. They always tried to teach their children the true value of ‘hard work’. Finally, all of these hard works and sacrifices made the prosperous Korea that you see now.
Nepalese, have you ever cried for your country? I heard that many of Nepali youth do not love their Nepal. I also heard that they want to leave Nepal because they don’t like caste system, or because they want to escape the severe poverty. However, they should be the first ones to voluntarily work for Nepal’s development, not the first ones to complain and speak against their country. I have a dream that someday I would be able to free the souls from suffering from the underdeveloped countries, anachronistic customs and the desperate hunger. My belief has become stronger than ever after seeing the reality in Nepal. A child with a fatal disease who doesn’t have enough money to buy a pill; a child living in what seems like a pre-historic dwelling and not having the opportunity to receive education; and a student who cannot succeed, no matter how hard he studies, just because of the class he comes from. A society, in which wives not only take care of children but also work in the fields, while their husbands waste their time doing nothing; a society in which a five-year-old must labor in a brick factory to feed herself. Looking at the reality of Nepal, I was despaired, yet this sense of despair strengthened my belief. I already know that many of the Nepalese are devout Hindus. However, nothing happens if you just pray to hundreds of thousands of gods while doing nothing. It is the action that you and Nepal need for the better future. For Nepal and yourselves, you have to show your love to your neighbors and country just as you do to Gods. You know that your Gods will be pleased when you work for the development of your country and improvement of your lives. Therefore, please, love your neighbors and country. Teach your children to love their country. And love the working itself. Who do you think will cry for your Nepal?
Who do you think will be able to respect the spirit of Himalayas and to keep the lonely flag representing it? You are the ones responsible for leading this beautiful country to a much brighter future. This responsibility lies on you.
(The writer is a 15 year-old student of Hankuk Academy of Foreign Studies, South Korea).