India wants to become the container hub between the West and the East
When the Zhen Hua 15 – a heavy cargo ship from the East China Sea – unloaded at Vizhinjam port last Sunday , it did more than deposit the first huge cranes at the site. It also put India on the map of the world's largest container ships.
Positioned near the southernmost tip of the country, the Vizhinjam transshipment container port – the first of its kind in India – will allow the nation to capture a bigger share of the international maritime trade currently dominated by China. It will also strengthen its aspirations to be an alternative manufacturing hub by reducing logistics costs for cargo arriving and departing the country.
The new terminal, which opened last Sunday, is another success for the empire of Gautam Adani , who faced a scathing attack from short-sellers in January accusing the Adani Group of corporate misconduct, allegations the Adani Group has denied , but which were then reiterated . With a presence already spanning ports, mines, airports and energy utilities, Vizhinjam will further cement Adani's billionaire status as India's infrastructure kingmaker.
Proximity to international shipping lanes that account for 30 percent of global cargo traffic and a natural canal that reaches 24 meters below sea level make Vizhinjam an ideal hub for some of the world's largest ships. Until now, such ships had avoided India because its ports were not deep enough to handle the ships and instead docked at ports such as Colombo, Dubai and Singapore.
The Vizhinjam port, according to the Adani Ports website, will offer quick turnaround of ships, including Megamax container ships. It will have a capacity of 1 million TEU in the first phase with an investment of Rs 77 billion. Approximately 6.2 million TEU will be added in subsequent phases.
Even so, operating a transshipment container terminal poses challenges, even for an experienced company like Adani Ports, which has already faced protests from fishermen at the site. A rival facility in Vallarpadam, operated by Dubai Ports World, has been plagued by procedural delays.
The transshipment hub must also be connected by a network of road and rail links to warehouses and factories inland. The lack of such support “can be Waterloo” for any port, said Mathew Antony, founding partner of Aditya Consulting, a consultancy specializing in infrastructure, ports and logistics.
The federal government is working on a plan called Maritime India Vision 2030 that aims to develop world-class mega ports, transit hubs and modernize infrastructure with an estimated investment of Rs 1.25 trillion.
As shipping becomes increasingly vital to trade between Europe and China, India may fit into that route, given its strategic location between the Suez Canal and the Strait of Malacca. India aims to become one of the major transshipment ports for containers, at a time when Europe has put its intermediate logistics activities in serious difficulty due to the application of very heavy taxes to "Non-green" maritime activities, condemning the container transshipment activity and go elsewhere.
Karan Adani said the port company is already in talks with two or three major shipping lines that will consider shifting their bases to Vizhinjam.
India's current container traffic is less than 10 percent of China's, but if Vizhinjam port is able to attract more ships, it will give India – and Adani Ports – a stronger position in global maritime trade .
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This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/lindia-vuole-diventare-lhub-dei-container-fra-occidente-e-oriente/ on Mon, 16 Oct 2023 08:00:23 +0000.