The modernisation of ports is a prerequisite. The various policy measures announced in the sector are expected to increase investor confidence in the sector which in turn will translate into great opportunities for growth in the port equipment market.

According to a recent report by ICRA, cargo at Indian ports has turned positive for the first time after seven consecutive months in October and November 2020, recording a 3 per cent and 1 per cent year-on-year (y-o-y) growth respectively. Ports are important contributor to Indian economy being the gateway for the export and import of goods. The digital revolution in Indian industries is growing, especially, in automobile, printing, packaging, pharmaceutical, and F&B sectors. Despite numerous initiatives, ports in India have a long way to go to develop an infrastructure that embraces the advance technology, which would certainly help them in improving performance, productivity and safety.

The port sector had been adversely impacted during the period March- September 2020 due to the Covid-19 outbreak and the subsequent lockdown introduced by India and other major economies. Although the sector was classified under essential services and remained operational after the initial period of lockdown, the adverse impact on the domestic economic activity and slowdown in global trade resulted in steep contraction in cargo volumes at the Indian ports.

Regarding the developments, Sai Krishna, Assistant Vice President and Associate-Head, Corporate Ratings, ICRA added: “The deceleration in cargo contraction is a favorable trend, but the recovery in certain segments like POL, which was expected to be faster with easing of lockdown, has not materialised in line with expectation due to continued subdued demand.” During the first eight months in the current financial year, cargo reported a 12 per cent decline.

However, that is a significant improvement over the 22 per cent decline recorded in Q1 FY2021. The pace of decline has moderated sequentially every month for key cargo segments, indicating continuing signs of a recovery.

ICRA Ratings says the pace of recovery in the port sector will becontingent on the pace of recovery of the domestic industrial activity and the global economy, and that they expect volume contraction of about 10 per cent in the FY2021. A revised projection of the earlier expectation of a 12-15 per cent decline puts the decline rate at 10 to 12 per cent, largely driven by the quicker than earlier expected pickup in industrial output and consequently higher EXIM volumes.

The Sagarmala programme was introduced with the intention of giving a boost to shipping industry, thus, reducing the country’s logistics costs. Since then, there has been a significant enhancement in India’s position in the logistics performance. However, there is more need of implementation of advanced automation and digitalisation technologies. Complete changeover will indeed take some time. However, a steady move towards the same will offer increased operational efficiencies, safety and better utilisation of existing assets. This means that in the coming years, Indian shipping sector will enjoy the benefits of modern technologies.

Also, the Union Cabinet has given its in-principle approval for setting up a major port at Vadhavan near Dahanu in Maharashtra. The total cost of the project is likely to be Rs 655.44 billion. Vadhavan port will be developed on the “land lord model”. A special purpose vehicle (SPV) will be formed with Jawaharlal Nehru Port Trust (JNPT) as the lead partner with equity participation equal to or more than 50 per cent to implement the project. The SPV will develop the port infrastructure including reclamation, construction of breakwater, besides establishing connectivity to the hinterland. All the business activities would be undertaken under PPP mode by private developers.

Says Saurabh Kulkarni, Mobile Automation Industry Expert, B&R Industrial Automation, “While there is a long way to go for Indian shipping sector to achieve operationalefficiencies similar to major maritime nations, there has been a noticeable enhancement in productivity at some Indian ports because of new technology and better government attention on the country’s shipping sector. Port modernisation with innovative technologies is key to competitiveness in an export-driven economy.”

From cargo vessels and offshore platforms to ports, shipyards and even unmanned underwater vehicles, navigating the maritime and offshore industry requires a broad range of highly specialised applications and technology. Smart ship technology is the key to boosting vessel’s safety, security and efficiency while simultaneously lowering operating costs. The machinery and equipment on a smart ship is fully automated and coordinated by a distributed shipboard monitoring and control system. This ship-wide system can be operated either locally on the vessel, or remotely from the fleet management centre on land. B&R’s rugged, distributed and scalable GL certified hardware together with conveniently encapsulated software components handles maritime and offshore application’s core functionality.

B&Rdedicated maritime and offshore solutions helps to accelerate the time to market while boosting the performance, efficiency and quality of equipment. APROL, Secure remote maintenance, cloud connectivity, condition monitoring, Energy monitoring are some of our solutions which helps in smart ship process control.

Adds Kulkarni, “Today’s safety technology actively supports the range of equipment functionality while simultaneously safeguarding it against hazards. It adapts to changing configurations and works reliably anywhere in the world. No longer limited to a single machine, today’s safety solutions span entire lines.

Smart Safe Reaction from B&R makes machine options manageable without compromising the safety level. To avoid the painfully high cost of stopping production, equipment needs to have availability designed in from the start. B&R’s intelligent safety technology plays a critical role in preventing downtime and production outages. SafeLOGIC and SafeLOGIC-X controllers give B&R safety technology the scalability it takes to create a cost-optimised solution for any application. Hardware components and soft ware functions remain fully compatible, regardless of which safety controller is selected.”

Th e Ministry of Ports, Shipping and Waterways (MoPSW) recently announced that the government is set to launch seaplane services on several routes, including Delhi-Ayodhya, in collaboration with airline operators. Th e development comes aft er Prime Minister Narendra Modi launched a seaplane service between Kevadia and Sabarmati Riverfront in Ahmedabad, on October 31, 2020.

For better connectivity and easier accessibility to remote locations, the Sagarmala Development Company Ltd (SDCL) is exploring plans to leverage the potential of the vast coastline and numerous water bodies/rivers across India by commencing seaplane operations.

Anil Bhatia, Vice President-Sales & Marketing, TIL highlights the progressive steps of the government for the port sector development, “Th e Government of India has accorded high priority for expansion of port capacity, with infrastructure development projects like Sagarmala, which is a big investment driver for the sector. Over Rs 5 trillion worth of projects are at various stages of implementation and development under Sagarmala alone. Proactive initiatives to attract more private participation, plan to corporatise at least one of the 12 major ports are definitely positive steps. Although the Budget allocation for Sagarmala projects is lower than the cost of planned initiatives, the prospects appear stable with positive outcome.”

Prakash Tulsiani, CEO, CFS, ICD & Investor Relations, Allcargo Logistics elaborates, “Th ere is room for improvement for port infrastructure in India. Even the Economic Survey 2019-20 has identified improvement areas like insuffi cient port infrastructure, narrow roads and poor strength bearing capacity of the roads. Th e port is well-placed and in terms of capacity building, we need deeper draft and improved connectivity. Th e lack of streamlined approach is also preventing the implementation of just-in-time shipment management protocols in ports which leads to congestion in ports.” Technological advancements arechanging manufacturing process. Th e use of advanced automation and digitalisation will help Indian marine sector to meet expected demand in the near future.

In spite of the slow progress in development activities, port equipment players see positive outlook in the long term.

Bhatia adds, “With the government actively responding to challenges related to connectivity, ease of doing business, etc, the outlook for the port and port equipment sector looks bright. Expanding cargo capacity and cargo traffic, increasing private participation and growing investments complemented by various initiatives by the government point towards positive times.”

Th e various policy measures announced in the sector such as amendment to the model concession agreement, cabotage relaxations, new draft guidelines for major ports, etc, are expected to increase investor confi dence in the sector which in turn will translate into great opportunities for growth in port equipment market.

- KARTHIK MUTHUVEERAN