Despite large strides in productivity in the last one year, JNP continues to be a feeder port, albeit premier one, due to constrains of a low draft. Currently the channel into both Mumbai and Nhava Sheva where JNP and the NSICT are located has a draft of 12 metres.

While Mumbai port will continue to be constrained by its lock gates, no matter how deep the draft, steps are on to remedy the situation for JNP. The surface transport ministry is currently looking at the possibility of improving the draft from the current 12 metres to 15.5 metres. The move will involve extensive dredging along the channel and is expected to cost several hundred crore (the international benchmark cost of dregding is $2.25 percu. m for unrestricted dredging and $7.5 per cu. m for dredging in a restricted area). A detailed report outlining the logistics of the project is currently with the ministry.

The immediate implication of the improved depth will be that post Panamax vessels (with a capacity of 6,000 teu), which have depth of 14 meters will be able to enter the channel. With the post-Panamax vessels offering huge economies of scale to shipping companies, several are investing in container vessels and tankages in that category. However, India has not been able to take advantage of the reduced transportation costs as the mainline vessels call only at major transhipment ports (the closer one of these to an exporter, the lower his transportation costs). Currently no Indian port offers such a draft. Indian exporters are, therefore, forced to use either Dubai or Colombo for transhipment. Shipping companies estimate that Indian exporters spend an extra 30 per cent in transport costs, only because India does not have a hubport.

According to sources, the move is also aimed at improving JNP's competitive advantage. With private ports springing up all over the country, there is a possibility that they could lose cargo, especially to locations such as Kandla, the Port of Singapore Authority operated Tuticorin or the proposed Rajiv Gandhi terminal at Vallarpadam. Besides the huge capital investment of improving the depth, the JNP management is currently putting in place labour reforms and work practices aimed at improving berth productivity and turnaround time of vessels.

According to a port spokesperson, incentives offered a few months ago to shipping company have not got the desired response and volumes in container traffic continue to fall.