India plans to build transhipment port on Nicobar

India is planning to build a transhipment port at South Bay on Great Nicobar island, a development that could be of both commercial and strategic significance to Southeast Asia as well as rival ports in Sri Lanka, reported The Straits Times.

"The idea is to create a hub for shipping companies with spokes radiating to the eastern seaboard of India, Bangladesh, Myanmar and Thai ports on the Andaman Sea," a person familiar with the plans told The Straits Times.

"These ports don't generate enough volumes to justify the sailing of very large container vessels, so we figure shippers can take advantage of an optimisation of capacities and logistics."

Current planning provides for a berthing facility of a modest 3.2 million TEUs by 2015, rising to 7.4 million TEUs by 2020. Should the project take off, India expects to build capacity of 17.2 million TEUs by 2020.

Quay length would rise in tandem from an initial 1,600m, enough for four berths, to 7,200m and 18 berths, ultimately.

Vessels calling at the port would be of capacities ranging from 6,000 TEUs to 12,000 TEUs, according to projections seen by The Straits Times.

Great Nicobar Island is on the southern tip of the federally administered Andaman and Nicobar chain of islands, a spot on the map less than 100 nautical miles from Sumatra. That strategic perch gives the South Asian giant a toe-hold in Southeast Asia.

Colombo, on India's southwestern tip, is the current hub for transhipment into most of India. Sri Lanka is rapidly developing another port in Hambantota with Chinese aid and engineering. That facility will cater mostly to India's western seaboard. The South Bay project in Great Nicobar is projected more towards the eastern seaboard.

“Traffic is ever increasing in the area and there is enough traffic to feed this, and the Sri Lankan ports,’’ said an official who wrote up the plan.

Besides, the Indian government has enough sops in its kitty to make the project viable. One way to do this is by declaring the area a Special Economic Zone, thus making available a variety of tax breaks.

That would make bunkering and ship repairs competitive. In any case, there are no local taxes in the Andaman and Nicobar islands.

The plans underline New Delhi's shifting priorities amid the rapid build-up of economic and military ties with Southeast Asia, part of the Look East policy initiated by the late prime minister Narasimha Rao two decades ago.

Thus far, the Andaman and Nicobar islands have lagged the development seen in some other states of the Indian mainland partly because of their remoteness, fragility of the ecosystems and strategic location.

India administers the area from Port Blair, which is in the Lower Andaman group of islands.

Port Blair is also home to India's first unified military command. Led by a three-star admiral, the command includes air, land and sea capabilities.

"For a long time, the thinking was that we should not have major investments in places where we have vital strategic installations because of the threat of widespread losses in war," said a senior Indian military officer. "Now, that idea is changing. Economic development itself is an integral piece of strategy."
(Source:www.cargonewsasia.com)