With Indian economy expected to register consistent growth, India's export-import trade was expected to increase as well as the proportion of containerised cargo to total cargo handled.

The container traffic at the major ports, which stood at 4.74 Mn TEU (equivalent to 59.73 million tons) in 2005-06, is projected to grow at a CAGR of 15.57 per cent to reach 15.1 Mn TEUs (181.20mn.t.) by 2013-14, according to the INSA Annual review for 2005-06.

The projections for total traffic at major ports being at 705.84mn.t. in 2013-14, containerised cargo traffic would thus be at 25.67 per cent of the total cargo traffic at the major ports by 2013-14.

The minor ports are projected to handle container traffic at 2.88 Mn TEU (34.56mn.t.) by 2013-14, taking the total container traffic at major and minor ports together to 17.98 Mn TEUs (215.76mn.t.) by then.

To cater to this huge container traffic that is going to be seen at the Indian ports, development of container terminal projects at ports have to be done rapidly.

Some such terminals proposed were the Container Terminal at Ennore, the second container terminal at Chennai, as well as container terminals at Kandla, Pipavav, Tuticorin and the JNPT fourth container terminal.

According to a report issued by CARE, due to the huge investments and logistics management issues related to containers, Indian shipping companies are at present not able to tap this segment significantly.

Currently only 1 per cent of Indian shipping tonnage is container ship, while over 14 per cent of the port traffic is containerised cargo.

Some companies like SCI, Shreyas Shipping, Shahi Shipping, are present in this space, but are fringe players in the global market.

While SCI provides main container ship service, Shreyas and Shahi provide feeder services that is used to transfer the cargo from the hub ports to different spoke ports.

Going forward, Care does not see Indian shipping companies adding significant tonnage to its container ship fleet because of the financial and infrastructure constraints.

Thus, the foreign shipping companies are expected to grab a lion's share of Indian container traffic.

Today India is not a major transshipment hub unlike Colombo, Hong Kong or Singapore.

In 2004-05 only 3.8 per cent of the total container traffic at Indian ports was transshipment traffic.

To encourage transshipment cargo, hub ports need to be close to the main line and have sufficient draft depth to accommodate large vessels, pointed out CARE.

The main line for container ships was East-West whereas for feeder lines it was North-South.

JNPT and Cochin were being developed as hub ports for India originating or outbound cargo while International Container Transport Terminal (ICTT) at Kochi port was being developed to handle transshipment of international container cargo.

CARE pointed out that the container penetration in India is much below the world penetration level due to inadequate multi-modal transport facility on the back of poor port-rail-road interfaces.

In India, surface movement of containers by rail was just 30 per cent of the total container moved while the rest is moved via road. This was because the roads provide the flexibility of door to door delivery while rail is constrained by the non-availability of rolling stock.

But movement of the containers over long distances via trains was cost effective and to further eliminate bottlenecks, the central government had come out with Rail Container policy in January 2006.

Till 2005, Container Corporation of India (CONCOR) held the monopoly in container train transport in India.

However, with the unveiling of the Rail Container policy, private participation in this space has been permitted which is expected to reduce the average cost per TEU and simultaneously increase the efficiency of operations.

The possibilities of backward and forward integration have also materialised which would allow the participants to provide complete end to end logistics service to container ship operators.

The Rail Container Policy requires the development of new internal container depots (ICDs) and integrated logistics parks, as the players in segment would need to have access to rail linked ICDs or develop their own ICDs within three years.

As a consequence, an investment of Rs 10,000 crore is expected in the next two years for wagons, logistics parks and ICDs.