The maritime and shipping infrastructure of India is a vital component in the country’s EXIM trade. Levels of marine trade have been growing steadily at 4.5 per cent annually, constituting a total of 95 per cent of India’s overall EXIM trade volume. Analysts have long agreed that the development of a booming maritime trade sector is essential for the long-term economic prosperity of countries boasting long stretches of coastline.
Development of the maritime sector therefore has the capacity to contribute significantly to the nation’s GDP, both in its own right and due to a multiplier effect caused by the increased scope for expansion of other industrial sectors. The main commodities traded through India’s maritime infrastructure are petroleum, oil and lubricant-based products (POL), and raw materials including iron and coal. Growth rates of trade in these commodities are expected to remain steady at five to 10 per cent annually over the next decade.
As discussed, maritime trade is an integral aspect of national trade. India’s maritime sector now needs a three-pronged plan, covering infrastructure development, workable policy and fiscal incentives, to ensure the continued growth of the maritime trade sector.
Concerning infrastructure, India’s coastline extends for over 7,500km, providing ample opportunity to transform sea transport into the prime mode of freight transportation. To make this a reality, however, attention needs to be paid to the first and last mile connections of logistics chains. As a case study, equipment upgrades for pallet racking in Ireland and the UK, such as those available from duffydiscount, help to increase the efficiency of loading, stowage and unloading operations.
Regarding policy, silt accumulates quickly; therefore, ports need to be dredged regularly. As vessel sizes increase to accommodate larger volumes of trade, access channels also have to be deepened via dredging. The government’s twelfth five-year plan, from 2012 to 2017, lays out the total dredging target of over 625 metric cube million (mcm). This includes around 220 mcm to be dredged from the country’s 12 main ports to deepen access channels. The rest of the target consists of the maintenance dredging over 400 mcm.
Maritime industry finance covers the financing of ships, ports and secondary logistics hubs. The maritime sector is highly capital intensive and financial incentives are necessary to draw the required levels of FDI to develop the sector.