Paradip port has enormous potential to emerge as a significant player to expand India’s EXIM activities and build economic and cultural synergies with South Asian partners and neighbours.
Paradip port, which is located in the Jagatsinghpur district of coastal Odisha, is poised to play a significant role in India’s maritime connectivity with South East Asia cementing the space for trans-regional free trade architecture.
In this ambitious corridor, as part of the Sagarmala project (Garlands of the sea), the Government of India intends to augment port-led industrialisation by linking the Kalinga coastal zone with a host of industrial and maritime clusters. As a result, Paradip port on the east coast undergoes massive structural and logistical revamping. India’s aspirational $5 trillion economy benchmark necessitates shifting attention to the domain of the blue economy as well.
The Indian peninsula constituting a 7,500 km coastline and 14, 500 km of navigable waterways presents the opportunity for India to capitalise on the sea space to forge trade ties with the neighbouring countries and beyond.
This venture does not embody any novelty as the history of maritime commerce narrates India’s decisive visibility, but the difference it makes is that of the neo-classical approach that India has adopted to bring energy to its economy through the mediation of the sea.
The major ports on the east coast include Haldia and Kolkata in West Bengal, Paradip in Odisha, Visakhapatnam in Andhra Pradesh, Tuticorin, Chennai and Ennore in Tamil Nadu, and Port Blair in Andaman & Nicobar Island. They facilitate synergies with the Indian hinterland, South East Asia and the partners in the Indo-Pacific. Their export-import profile covers petrochemical products, fertilizers, food products, salt, iron, iron ore, aluminium, automobiles, cement, etc.
Shifting the gravity of attention to Paradip, it is placed in the middle between Kolkata port (210 nautical miles) and Visakhapatnam port (260 nautical miles). Capacity expansion and hinterland connectivity through railroad and highway are the important areas that have been taken up to inaugurate the port-led development.
The Kalinga Coastal Economic Zone links Paradip with Dhamra port covering the coastal districts such as Puri, Jagatsinghpur, Cuttack, Kendrapara, Jajpur, and Bhadrak to build industrial clusters and smart cities. These localised linkages are further connected with the industrial corridors in West Bengal, Andhra Pradesh, and Tamil Nadu to transform the east coast commercial, manufacturing, and Export-Import (EXIM) strength.
In addition, the vast hinterland, including Odisha, Jharkhand, Chhattisgarh, Madhya Pradesh, Uttar Pradesh, Bihar, and West Bengal may get effectively connected to the Paradip port through railroad and highways and further coordination may be built by inter-port connectivity.
Coastal circuit formation and cruise tourism are some of the potential areas which are planned to be developed to give a fillip to coastal tourism. This appears very ambitious and efforts have been made in the right direction to achieve the goal. If these developments are successful in the coming years, the Indian focus would essentially be on South East Asia to conduct more export-import-related activities.
Self-reliant India with its focus on the manufacturing sector may emerge as a significant competitor in the South East Asian markets. This may initiate competition and may significantly reduce the Chinese monopoly there. Its unrestricted BRI expansionism will experience significant deterrence. Therefore, Paradip port has enormous potential to emerge as a significant player to expand India’s EXIM activities and build economic and cultural synergies with South Asian partners and neighbours.
The indications are very positive and are quite expressive of the fact of India taking up a leadership role in the years to come. Its democratic credential will aid its emergence as a reliable partner and a leader. The global supply-chain disruption with the outbreak of the Covid-19 pandemic and China’s shrewd monopoly in the sector and its alleged involvement in abetting the pandemic and data secrecy and its Belt and Road Initiative (BRI) interventionism through corridor formation have invited a dent in its global image.
There is no quick fix to alter this perception. This allows India to emerge as an impactful leader in the supply-chain sector. In this connection, building port connectivity with South East Asia requires essentially Myanmar’s partnership. The latter’s political instability, militancy, military rule, and Chinese interventionism in its internal politics create a bottleneck in committing durable maritime ties with it.
The Kolkata Port and Sittwe Port (Myanmar) connectivity are a few diplomatic and logistics clearances away to function effectively. The progress experienced uncertainty with Sui Kyi’s arrest by Myanmar’s military junta. But, if India devises some form of tactical diplomacy, there is always a way out to secure some optimism to reinforce stronger ties.
However, ups and downs are recurrent in any international relationship. China apparently is the impediment, not Myanmar. But, India’s aspirations of reaching out to the South Asian neighbours require Myanmar’s deep partnership and its decoupling from China’s tutelage.
India-South East Asia Maritime Space
Moving ahead, inter-port connectivity between the Kolkata Port and Paradip port may serve the purpose of reaching the Sittwe port and thereafter to Cambodia, Indonesia, Laos, Malaysia, the Philippines, Singapore, Thailand, and Vietnam, and also to India’s Northeastern region involving multimodal operations.
Moreover, to reduce the burden on the Kolkata port, the connectivity linkages may be directly developed between the Paradip port and Myanmar’s Kyaukpyu, Thandwe, and Pathein ports. China has already funded the Kyaukphyu Special Economic Zone (KPSEZ) and India ought to expand its depth in Myanmar apart from its investment in the Sittwe port project.
The great game of competition has already begun between India and China. It is, therefore, the time to unleash the potential of the Paradip port to express India’s clear intent to forge enduring ties with the South East Asian neighbours and partners. Highlighting the strength of the Paradip port, it currently handles numerous cargos covering crude oil, Petroleum, Oils and Lubricants (POL) products, iron ore, thermal coal, chrome ore, coking coal, manganese ore, charge chrome, ferro chrome, ferro manganese, limestone, hard coke, ingots and moulds, billets, finished steel, scrap, fertiliser, fertiliser raw material, clinker, gypsum, project cargo, and containers.
Its proximity to the mining states such as Odisha, Jharkhand, and Chhattisgarh makes it all the more important to conduct import-export activities. In the event of the development of coastal industrial clusters and manufacturing hubs, Indian exports including automobiles, electronics, pharmaceuticals, fertilisers, food-processing, etc., will be transported to the South East Asian countries through the Paradip port directly or through the inter-port connectivity and interdependence.
The Sagarmala project is rightly on track to maximise India’s depth on the east coast and its effective integration with the South East Asian nations. Needless to say, China is a major obstacle to India’s east coast enterprise and trade depth. Beijing’s arbitrariness in the region requires the presence of a competitor to introduce freedom of choice. India ought to upgrade its diplomacy and logistics to inaugurate the era of competitiveness in the Bay of Bengal and the Indo-Pacific region. For this incredible enterprise, the port logistics must be revitalized and the Paradip port’s strategic and economic depth must be capitalised.
Originally published: Open, October 22, 2022.
Posted in SIS Blog with the authorization of the author.
Dr Jajati K Pattnaik is an Associate Professor at the Centre for West Asian Studies, School of International Studies, Jawaharlal Nehru University, New Delhi. Dr Chandan K Panda is an Assistant Professor at Rajiv Gandhi University, Itanagar, Arunachal Pradesh.