The signs of an economic slowdown continue to cast a shadow on the ports sector’s growth, as total cargo by the 12 major ports fell 5.7 per cent in the first two months of the current financial year, against a growth of 5.1 per cent for the corresponding period last year. With reduced growth in the gross domestic product, the fall in cargo has not come as a surprise to the sector, which also saw yearly cargo go in the negative for the first time in over a decade.
“There has been a reduction in overall trade. Exports have gone down. The competitiveness of our product has taken a hit,” said Hemant Bhattbhatt, senior director, Deloitte India.
Major ports reeled under the impact of slump in iron-ore cargo due to mining crisis with the 29 per cent decline in April-May 2012 compared to a 15 per cent fall last year. The highest decline was seen in the raw fertiliser with the cargo coming down by 34.6 per cent for the same period, followed closely by finished fertiliser which fell by 29.2 per cent.
Kolkata Port Trust saw a 22 per cent fall in cargo.Being a bulk port, it mainly handles commodities like iron ore, coal, etc. A senior official said, “There is a faulty policy in place. Ours is not the preferred port, since higher export duty is charged on the basis of the Chinese price of iron ore. For all other ports, the cargo is free on board.”
Besides, major ports also blame the fall in cargo on rupee depreciation which has softened the demand for imports. For 2012-13, the shipping ministry has set a target of six per cent growth over the previous year. A senior shipping ministry official said ports sector growth is a reflection of international economic activity, which is under pressure.
