Kerala expects boom in logistics sector

With the Centre giving approval to relax the Cabotage law, it is expected that around 50,000 direct and one lakh indirect employment opportunities will be generated within five years

Published: 08th September 2012 11:59 AM  |   Last Updated: 08th September 2012 11:59 AM   |  A+A-


With the Union Cabinet’s approval to relax the Cabotage law facilitating the transshipment of containers to and from the International Container Transshipment Terminal (ICTT), Vallarpadam, the logistics sector in the state is all set for a giant leap.

 It is expected that around 50,000 direct and one lakh indirect employment opportunities will be generated within five years. A massive investment of about Rs 15,000 crore will also be pumped into the sector.

 However, the experts feel that infrastructure facilities should be in tandem in order to milk the opportunities. N A Muhammed Kutty, managing director, Falcon Infrastructures Ltd, said that 60 per cent of the cargo movement to Kochi is now transshipped.

 “By relaxing the norms, foreign vessels could directly reach Vallapadram. A dedicated rail cargo corridor should be formed from Vallarpadam to Chennai, Bangalore and Hyderabad for better connectivity,” he said.

 At present, the rail traffic in the state is almost 25 per cent above the capacity. To tap the potential of the law relaxation, better road, rail and water connectivity are crucial.

The ICTT will realise its full potential of one million twenty-foot equivalent unit (TEU) within a year. Owing to it, newer opportunities will emerge not only at the Vallarpadam terminal but at Vizhinjam, Azheekkal, Beypore and 14 other minor ports.

Sources said that India is being treated as the future hub in the field of logistics all over the globe. The country is keen to offer transportation and logistical service to grow itself as an emerging market place.

The key sectors include fashion, gems, jewellery, pharmaceuticals, precision tools and engineering goods, all of which need special shipping provisions, they said.

 Areas such as supply chain, logistics, material handling, storage, information technology, warehousing and inventory management will emerge as possible business areas in the state. 

 Apart from these developments, most of the Malayalis occupying key posts in many reputed logistics companies across the world, especially the Middle East, will try to relocate to the state.

In the ‘Emerging Kerala’ meet, the government is proposing a logistics park in Kochi, nearer to the ICCT, Vallarpadam, which is a positive step in this regard.

 According to the Indian Ports Association estimate, the projected traffic at the Cochin port is 2463 million tonnes, and would reach 5349 million tonnes by 2025-26. An increase of 12-15 percent is expected in traffic in the next three years.


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