Shipping Ministry mulls making Bhavnagar a Container manufacturing hub

BHAVNAGAR: In a move to produce the shipping containers locally, the Ministry of Ports Shipping & Waterways (MoPSW) has appointed a Coordination Committee to study the feasibility of manufacturing the containers in Bhavnagar, Gujarat, and subsequently transform it into a container manufacturing hub by using recycled and fresh steel for fabrication of containers.

The Coordination Committee comprises of Mr. Rahul Modi, President, Modi Minerals Group and Member of the National Shipping Board, with others members including Mr Atul Sharma, General Manager (Env), Gujarat Maritime Board, Mr Kirit Soni, President, Saurashtra Chamber of Commerce And Industry (SCCI), Mr Nitin Kankia, Ex-Secretary Ship Recycling Industries Associations, Mr Haresh Patel President, Sihor Steel Re-rolling mills association, Mr Prakash Doshi, President, Bhavnagar Induction Furnace Association, representative from ArcelorMittal Steel Production Company and officers from the MoPSW.

This committee had done B2B meeting on 18th December 2020 at Bhavnagar at SCCI Hall and had carried out detailed discussions with the representatives of Saurashtra Chamber of Commerce and Industry, Ship Recycling Industries Association, Sihor Steel Rolling Mill Association, existing container manufacturers of Bhavnagar, representatives of Transworld Group, Pushpak Logistics and others.

Speaking on this occasion, Mr. Modi mentioned that the demand for shipping containers is on the rise due to increased manufacturing and export activities taking place in India. “Indian coastal shipping adds around 10,000 TEUs of new containers annually, while India’s largest container rail operator and PSU CONCOR adds approximately 2000 to 2500 TEUs of new containers in 1 to 2 year gap. Other major container buyers in India are domestic shipping companies like SCI, Avana Logistics, Transport Corporation of India (TCI), Simtech, container rail operators like Boxco, DLI, Adani, IndiaLinx and others. Other than this, cold chain management, car carriers,home offices and project sites, etc. also have container requirement in varied quantities,” he said.

Mr. Kirit Soni said that SCCI is delighted to note that Bhavnagar has been chosen as container manufacturing hub and this will bring more job opportunities for people in and around Bhavnagar.

“Almost all the shipping containers used today are being imported from China. By the time they reach Indian shores, they cost us around 40% more (which includes ocean freight, Customs duty, taxes, CHA charges and other costs)” Mr. Modi said.

China makes about 90 per cent of the global shipping containers. CIMC is the largest container manufacturer with a market share of 40 per cent. Other players include Singamas, COSCO and CXIC.

Currently, India sources its entire container needs from China at prices ranging from ?2,39,760-4,54,545 depending on the size of the container.India’s external trade grew to $838.46 billion in FY20 and the increasing trade is translating into higher demand for containerisation due to their efficiencies.

The global container fleet is handled by container leasing companies and shipping lines, with the latter holding a 49 per cent share. Triton is the world’s largest container leasing company with a market share of some 14 per cent, owning over six million TEUs.

The government’s move to produce shipping containers in India is part of the Atmanirbhar Bharat initiative and comes on the heels of creating import substitutes for the new shipping containers.

To start things rolling, a pilot project was initiated to study the feasibility and all by placing an order of few containers to the local manufacturers of Bhavnagar belt by Jamnagar and Kochi based logistics company Pushpak Logistics, leading player in coastal multimodal logistics. Transworld representatives too have made a presentation during this meeting and have expressed interest to purchase containers from the Bhavnagar hub.