A new container terminal is opening on India's east coast, where capacity is on the rise and cargo growth has stalled.
Kakinada Container Terminal (KCT) is beginning operations, providing shippers with another option on India's east coast. The new terminal joins the list of other privately-owned locations along the shoreline, including Krishnapatnam, Karaikkal, Gangavaram and Kattupalli, according to the Journal of Commerce (JOC). The terminal is a joint venture between Singapore's PSA International and two local organizations – Kakinada Infrastructure Holdings and Bothra Shipping Services.
"KCT will serve the agricultural, seafood and commodity trade and cater to the growing demand for containerization of such products in the Kakinada region," said Mike Formoso, managing director of PSA India, according to the JOC.
India's newest terminal well situated for agriculture
The new terminal is located in the Kakinada Deep Water Port (KDWP), TNN explained. Numerous agricultural companies have set up their processing centers in the region, due to its favorable location concerning products such as those mentioned by Formoso. The area exports goods such as rice, sugar, maize, shrimp and paper. KCT will be able to handle 200,000 Twenty-foot Equivalent Units (TEUs) per year. It features a 300 meter quay, in addition to mobile harbour cranes and reach stackers.
"The new container terminal will bring container services to the doorstep of the rice bowl, seafood and agri-export heartland of India and result in considerable savings in logistics to the EXIM trade of the region." Ajit Bothra, director of Bothra Shipping Services Pvt Ltd., told TNN.
KCT opens amidst negligible cargo movement at other east coast terminals
The new port is opening up as India's east coast terminals find efforts to grow volume hampered by too much capacity and not enough cargo, the JOC explained. For example, Krishnapatnam – despite its impressive 57 percent year-over-year jump in container volumes for fiscal 2014-2015 – moved a mere 91,572 TEUs during that same period. The port was designed to handle 1.2 million TEUs annually.
Kattupalli, meanwhile, has been the recipient of plenty of investment, but that funding has not yet begat much in terms of results. Despite new landside facilities and equipment, the terminal has not seen much growth in the last two years. Kattupalli handled roughly 29,000 TEUs for the fiscal 2014-2015 year. However, despite east coast terminals' recent struggles, the Andhra Pradesh State Authority, which operates KCT, has stated the new complex is well situated for results.
"KCT is well connected by national highways and rail to key cities in the region. Coupled with its proximity to the cargo centers, the terminal is the preferred choice for shippers as it allows them to achieve significant savings in transportation cost and time," explained the private operator, according to the JOC.
Whether KCT will provide a boost for India's struggling east coast remains to be seen. However, bullish operators seem to think that the terminal, in part due to its advantageous location, will certainly see plenty of business now that has begun operations.