NSICT: jewel in the crown

The Nhava Sheva International Container Terminal (NSICT) was born when P&O Ports, now DP World, won a 30-year Build Operate Transfer concession in 1997 to invest $250m in a second container terminal at the Jawaharlal Nehru Port in Mumbai. Having fought off competition from the likes of Hutchison Port Holdings and PSA and required to handle a projected 500,000 teu by its 16th year of operations, NSICT achieved this figure in just its the second year. It also quickly set a string of records for crane productivity, berth throughput and vessel turnround.

The terminal today handles close to 1.5m teu a year, more than any other private terminal in India. It is state-of-the-art, with super panamax cranes, computerised container information and ship planning systems and user-friendly remote access technologies. NSICT has also been consistently profitable and has routinely outperformed the adjacent government-run terminal.

The success of NSICT saw P&O Ports rapidly expand its activities in India by acquiring concessions for terminals at Chennai and Vizag ports on the east coast, taking over Mundra in Gujarat on the west coast from its Indian promoter and entering into a joint venture with the regional government in West Bengal for a port at Kulpi. Without doubt, NSICT and these other Indian terminals were a major attraction to DP World when it took over P&O Ports.

NSICT has, however, often been seen as overly aggressive and accusatory of the port authority. Fears of a monopoly saw P&O Ports being barred from participating in the bid process for the third terminal at Jawaharlal Nehru Port, which has since gone to APM Terminals. And India?s Tariff Authority for Major Ports, which uses a cost plus ?reasonable return? formula to regulate tariffs at federal ports, unilaterally lowered the tariff ceiling at NSICT by 12.85% in 2005, citing lack of cooperation by the operator in submitting data on costs.

The fact remains, though, that NSICT is widely admired for its achievements. The history of private container terminals in India would never have been quite so exciting without NSICT, which taught the country how much private enterprise can achieve.