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Indian Ports Analysis

March, 2014

India has 13 major ports and about 200 non-major ports. Cargo traffic in 2012 was 911.5 million metric tonnes (MMT) and is expected to reach 1,758 MMT by 2017.

Cargo traffic increased at a compound annual growth rate (CAGR) of 2.8 per cent during FY 07–13. India’s total external trade is estimated to have grown to US$ 791 billion in FY 13, implying a CAGR of 17.7 per cent since FY 06.

The government has allowed foreign direct investment (FDI) of up to 100 per cent under the automatic route for projects related to the construction and maintenance of ports and harbours. It has also allowed a 10-year tax holiday to enterprises engaged in the business of developing, maintaining, and operating ports, inland waterways, and inland ports.

Increasing investments and cargo traffic point to a healthy outlook for port support services. Currently, limited players provide port Operation and Maintenance (O&M) services, ensuring an opportunity for domestic and overseas players in that segment.

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