Container Shipping in India: Mapping the cargo Containers India 2014 Navin Kumar 20 Aug 2014

© Drewry Drewry | Container India 2014 Presentation outline India’s international trade Cargo / hinterland mapping Trade partners Outlook Conclusions

© Drewry Drewry | Container India 2014 INDIA’S INTERNATIONAL TRADE

© Drewry Drewry | Container India 2014 India's international trade  India’s international trade grew from just $45.5 billion in 1993 to $802.7 billion in  While the country’s trade grew at a CAGR of ~15% over last two decades, imports grew faster than the exports.  Faster growth in India’s imports has adversely affected the country’s trade balance – India had about $130 billion of trade deficit in  The present government has announced intentions to minimise trade deficit by promoting domestic production to meet country’s own demand, and increase exports. Source: UNCOMTRADE Database, Drewry Maritime Research CAGRExportsImportsTotal Trade %16.2%15.4% %20.5%19.8% %4.0%4.9%

© Drewry Drewry | Container India 2014 India's container throughput One of the salient feature of Indian container market is that it is primarily O- D traffic driven, transshipment contributing only marginally to the total throughput. Therefore, it is a very stable market growing at an exceptional pace. Container traffic in India has achieved a CAGR of around 13% over the last 10 years, while annual average growth rate over the last five years has hovered around 5%. In 2002, major ports in India accounted for almost 99% of the container traffic. However, over the last few years the container traffic at non-major ports in India has increased considerably, primarily due to the growth registered by Mundra and Pipavav. Source: Drewry Maritime Research

© Drewry Drewry | Container India 2014 CARGO / HINTERLAND MAPPING

© Drewry Drewry | Container India 2014 Product category wise India’s trade 2013  RMG/Textile sector has traditionally dominated the exports.  Chemicals, especially cyclic hydrocarbons, are the second most exported containerized cargo from India.  Steel products and Reefer food products are other major products in India’s export basket.  Rising income levels and invention of end user gadgets have led to higher imports of electrical and electronics good.  Advanced mechanisation and industrialization in India has resulted in higher imports of machinery and spares. Source: UNCOMTRADE Database, classified and compiled by Drewry Maritime Research Imports Export

© Drewry Drewry | Container India 2014 Major centres of cargo origin – Exports from India Source: Drewry Maritime Research Export  Tamil Nadu is the single largest containerised cargo producing state in India with a market share of 16%. Major exports include Automobile parts, RMG/textile and electronics.  Delhi NCR is the only non-coastal state to feature among top 4 cargo producing centres.

© Drewry Drewry | Container India 2014 Major centres of cargo destination – Imports in India Source: Drewry Maritime Research Import  Tamil Nadu is also the single largest containerised cargo importing state in India with a market share of 20%. Major imports include Electronics, metal scrap and automobile spares.  Top 4 importing centres account for ~65% of India’s total containerised cargo import.

© Drewry Drewry | Container India 2014 TRADE PARTNERS

© Drewry Drewry | Container India 2014 Country wise trade direction of India’s container trade (in $ billion) Country USA111 China1752 UAE423 Germany244 UK335 Changing ranks of India’s export partnersChanging ranks of India’s import partners Country China1021 USA112 Germany233 Korea, Rep.544 Japan355 Source: UNCOMTRADE Database, classified and compiled by Drewry Maritime Research Exports-2013Imports-2013

© Drewry Drewry | Container India 2014 Changing share of top trade partners of India Source: UNCOMTRADE Database, classified and compiled by Drewry Maritime Research Major export destinations Major import sources

© Drewry Drewry | Container India 2014 OUTLOOK

© Drewry Drewry | Container India 2014 Source: DMIC Development Corporation Dadri-Noida-Ghaziabad investment region Manesar-Bawal investment region Khushkhera-Bhiwadi-Neemrana investment region Pithampur-Dhar-Mhow investment region Ahmedabad-Dholera investment region Shendra-Bidkin industrial park Dighi Port industrial area SeaportsRoads Identification and development of Greenfield ports. Construction / Augmentation of major arterials and expressways. Up-gradation of existing ports. Developing additional feeder roads. Dedicated Jetties for cargo movement. Developing regional connectivity to DFC Rail heads. Rail Industrial Construction/ Augmentation of new rail links/feeder lines to DFC. Setting up self-sustainable manufacturing/industrial regions. Developing additional DFC spurs and regional rail links. Promote development of processing activities (SEZs/ Industrial Parks/ Port Based Industries, Integrated Food/ Agro Parks). Logistics Setting up free trade warehousing zone, container freight stations, cargo hubs, truck terminals, etc. Components being developed along DMIC DMIC Investment Region LEGEND Other Key Investment Zones Valsad-Umbergaon Industrial Area Surat-Navsari Industrial Area Sinnar-Nashik Industrial Park Delhi-Mumbai Industrial Corridor (DMIC)

© Drewry Drewry | Container India 2014 Western Dedicated Freight Corridor Alignment Source: Dedicated Freight Corridor Corporation of India (DFCCIL) −Post commissioning, it would facilitate higher number of trains running on a particular corridor. For example, the number of trains running on Ahmedabad-Marwar corridor could increase from 15 trains each way to 72 trains per way; and the trains running on JNP- Vadodara corridor would increase from 9 to 49. −Eastern and Western corridors will be constructed simultaneously. It is envisaged that the corridors will be fully operational over their entire length by 2018 – 19. SectionYear Phase 1Revari – Vadodara (920 Km)2011 – 2017 Phase 2Vadodara – JNPT (430 Km)2012 – 2018 Phase 3Rewari – Dadri (140 Km)2013 – 2018 Western DFC | Project Timelines Source: DFCCIL Dedicated Freight Corridor (DFC)

© Drewry Drewry | Container India 2014 CONCLUSIONS

© Drewry Drewry | Container India 2014 Conclusions Policy initiatives by the new government aimed at providing impetus to manufacturing, will create more cargo centres. Containerization penetration to be increased – by producing more processed goods and light cargo. Containerization of containerisable general bulk cargo to be promoted, innovative ideas needed to tap the market potential. Efficient transportation network needs to be developed, spread uniformly, to connect India’s coastline – both East and West. Liner Shipping Connectivity Index Source: UNCTAD Stats, 2014

© Drewry Drewry | Container India 2014 Singapore Drewry 15 Hoe Chiang Road, #13-02 Tower Fifteen Singapore T: E: We are privately owned with research and advisory teams in London, Delhi, Singapore and Shanghai. Drewry was founded in 1970 as a provider of independent information and advice to the global maritime industry. Since then we have worked with over 4,000 clients in more than 100 countries. London Drewry Christopher Street London EC2A 2BS,United Kingdom T: +44 (0) E: Delhi Drewry 209 Vipul Square, Sushant Lok-1 Gurgaon , India Telephone: /32 E: Shanghai Drewry 555, 5th floor Standard Chartered Tower, 201 Shi Ji Avenue, Pudong District, Shanghai, China T: +86 (0) Thank You!