In the expansion mode

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G SAMBASIVA RAO MD, SRAVAN SHIPPING SERVICES

Opportunities galore in the sunrise state as industrialisation and manufacturing activities are looking up. Hooking on them is Sravan Shipping, flexing its services with new CFS and FTWZ planned to provide the much needed logistics support.

Q What are the major projects you are looking forward to?

Our group is planning to operate second CFS near Gangavaram Port in the month of February 2017. Moreover, we are also setting up a logistics park and Free Trade Warehouse Zone Project at Visakhapatnam in 2018.

Q How do you see industrialisation and manufacturing growth in Andhra Pradesh taking shape? What is your view on competition from new CFS facilities coming up in the region? What has been the impact of direct port delivery on CFSs?

We are expecting industrialisation and manufacturing growth in this area as Andhra Pradesh government in the Partnership Summit in 2016 mobilized `4.70 lakh investment opportunities and in the latest edition of the Partnership Summit this year, we are expecting about `8 lakh crore worth of investment in this region. Out of all the investment projections, even if 20 to 25 per cent of the projects can be materialized, the state will be in a better position. Recently the government is giving more attention on food processing sector. By this, not only industrialisation but also manufacturing activity will grow. Competition from other CFSs will be there. In order to achieve results one has to do proper marketing and attract customers from the hinterland like Nepal, Jharkhand, Chhattisgarh, Odisha, Telangana and Andhra Pradesh. Direct delivery of containers may not impact CFS operators because the same system may be applicable to one or two major ports in western India whereas in this region there will not be any benefit and cost advantage, as about 95 per cent of exporters/ importers are not paying any demurrage or detention fee at Visakhapatnam. In future, we expect tough competition from Kakinada, Krishnaptanam and some ports in Odisha.

Q What is the prospect of Vizag as a transshipment hub of the future?

Recently transshipment cargo by Maersk Line has moved from Visakhapatnam to Krishnapatnam since the liners see the advantage of their operations and also the benefit and cost saving analysis. But, I feel in the long run, transshipment operations will continue at Visakhapatnam by some other lines as per their convenience. In future, Visakhapatnam will definitely evolve as one of the transshipment hubs as the terminal is planning for development of its third berth and also proper back up area.

Q What is the impact of Kakinada Terminal on Vizag trade?

Due to start of container service at Kakinada terminal, some cargo from East-West Godavari, Krishna and Guntur districts may come to the terminal because of the proximity and logistics advantage, especially cargoes like rice and sea food will have positive impact on Kakinada terminal when compared to Visakhapatnam because of cost advantage.

Q What makes trade from east and central India to prefer Vizag over other ports?

CONCOR is developing a logistics park in 100 acres of land and Visakhapatnam being a railway divisional headquarters and because of the upcoming railway zone, it will have its own advantage. The central government has announced development of Visakhapatnam – Chennai Freight Corridor, due to which container and bulk cargo movement will increase. In addition to the above, a lot of coastal cargo can also move from one port to another port as Visakhapatnam has many private operators who are willing for a competitive rate as per the budget of manufacturers for moving their bulk cargo through coastal shipping at a reduced price.

Q What are the recent trends in coastal movement on the east coast?
RINL and other steel manufacturers are using coastal shipping and coal is also being moved through this mode. Vehicle makers like Ashok Leyland and others move their equipment through coastal vessels, saving a lot of cost.