APM Terminals CEO Kim Fejfer Sees Opportunity in India
By Anuja Abraham
With a population of 1.2 billion and the world’s third-largest economy, India remains significantly underrepresented as a player in global trade, and that is something APM Terminals CEO Kim Fejfer is eager to change.
“The opportunities for development throughout India, one of the world’s largest and fastest-growing economies, are exciting and energizing and APM Terminals is committed to being a part of that growth” stated Mr. Fejfer while speaking to local business leaders and customers as part of a keynote address at the India Ports Conference in Mumbai.
Although the Indian economy expanded by an estimated 7.8% in 2011 to $1.8 trillion USD ($4.4 trillion when adjusted for purchasing power parity, behind only the USA and China), India ranked 13th in imports and 21st in exports globally last year. South Asia, which includes Pakistan and Bangladesh, represented only 3% of global container throughout in 2011, according to estimates by Alphaliner, with combined container volume of 18 million TEUs, four million less than the Port of Shenzhen, China.
Throughput at India’s ports accounted for 9.7 million TEUs in 2011, or one twelfth of what global container traffic averages based on economic output would suggest as necessary to meet the economy’s needs. In his presentation, Mr. Fejfer estimated the infrastructure investment necessary to enable projected growth at $20 billion USD.
Jawaharlal Nehru Port (JNP), serving Mumbai, is India’s busiest container port, accounting for nearly 45% of all Indian containerized cargo traffic. It is the 25th busiest container port in the world, with throughput of 4.3 million TEUs in 2011. APM Terminals Mumbai handled an estimated 1.9 million TEUs in 2011. Congestion and capacity issues at Indian ports have begun to affect trade growth, as existing container terminals are at 84% capacity and above, and access to inland points remains inadequate.
The Indian Government is determined to promote infrastructure growth and had projected JNP container throughput to increase to 11 million TEUs by 2016 and 23 million TEUs by 2020, as called for in the latest 10-Year Plan released by the Indian Ministry of Shipping. Mr. Fejfer pointed out that private sector involvement will be a crucial component of this growth if the investment and regulatory environment in India do not act as constraints.
“Port tariff regulations which penalize increased throughput and productivity will not assist in developing the needed infrastructure,” added Mr. Fejfer.
In addition to Mumbai, APM Terminals also operates APM Terminals Pipavav also on the Indian west Coast in the State of Gujarat. Pipavav has been recognized as India’s 2 / 4 fastest-growing port with a throughput of an estimated 620,000 TEUs in 2011, and is India’s first private sector port operation.
Other business interests in India encompass APM Terminals India Pvt. Ltd., which operates Inland Services operations at seven locations throughout the country, including at Chennai which was recognized last month as India’s “Container Freight Station of the Year” at the India Maritime Gateway Awards ceremony held as part of India Maritime Week. APM Terminals also operates global service centers at Mumbai, Chennai and Pune.
“We are pleased with the progress that we have made since entering this market in 2006, and we will continue to look for the right opportunities to expand our presence here to serve our customers, and India’s great economic potential” said Mr. Fejfer.