Title: Public Private Partnerships and Competitive Advantage of Indian Dry

Ports.

Abstract

In the present global economic situation, oversupply of shipping, ports and related dry

port services is ubiquitous. This has resulted in drastic cost cutting measures being

adopted by the stake holders on one hand and a coordinated rationalization of supply

on the other. The combined measures and slight improvement in demand has resulted

in bringing a semblance of respectability to the freight rates charged by the service

providers. However this is unsustainable in the long run as the root causes of the

financial meltdown have yet to be addressed. In such circumstances this paper argues

that the coordinated rationalization of supply should be institutionalized for the

benefit of all stakeholders by way of public private partnerships. The alternative

scenario is too depressing to contemplate which could set back the industry as a whole

for a long time to come.

Key words: Dry Ports, India, Public Private Participation.

Introduction:

The development of dry ports is one of the several important instruments, deployed by

the government for the consolidation and distribution of goods with functions

analogous to those of a seaport. Completing necessary documentation and procedures

at these facilities helps reduce congestion and delays at border crossings and ports, by,

reducing transaction costs for exporters and importers. The container or the ‘box’ has

lent a new dimension to logistics, and provided meaning and substance to integrated

intermodal concept. The shippers/consignees of goods not only look for speed,

reliable door-to-door services, but also for a complete logistics solution, which

necessitates multimodal integration. (Haralambides, H., 2005). However according to

a recently conducted study by the World Bank the Indian Logistics cost is one of the

highest in the world mainly due to an imbalance of demand and supply of competitive

dry port services.

A dry port is the inland equivalent of a marine container terminal. The only difference

for an inland intermodal terminal is that the transfer between modes does not require

sea access. “The dry ports are directly connected to seaport(s) with high capacity

1

transport mean(s), where customers can leave/pick up their standardized units as if

directly to a seaport.” (V. Roso and P. Lévêque, 2002). There are many examples of

historic inland ports based on rivers, such as Duisburg in Germany. The primary

reason for their creation and development was, of course, the existence of a navigable

river or lake. However, Indian dry ports have often been located due to their easy

access to established hinterland rail and road routes (Ng and Gujar, 2007). One of the

chief advantages of dry port is reduction of “Transportation-related waste” associated

with inefficient supply chains can be eliminated or at least reduced. This is achieved

primarily through better linkage between different modes (e.g., intermodal rail

facilities) or within modes (e.g., connections between different major road routes);

and increased collaboration between different institutions undertaking such functions

as distribution, warehousing, and manufacturing, providing a “shared location for

partners”. In other words, this is a benefit of clustering. (Chakravorty & Lal, 2005)

The number of dry ports within a region or a country would depend on geography as

well as diversity and extent of economic activity. The indicative norm suggested by

UNESCAP Secretariat for one dry port per million TEU handled at the country’s

seaports may, in effect, vary in different situations. In Europe, one dry port is

generally observed for each city with annual output exceeding $ 2.5 billion. (Hesse, M

& Rodrigues, J). The size of ICDs and CFSs would likewise vary according to the

industrial production and commercial transactions in the area served by the facility.

The average size of dry ports in European Union is seen to vary from a yearly

throughput ranging from 40,000 to 1.9 million TEU, their land area similarly ranging

between 30 and 200 hectares, the number of enterprises between 25 and 100, and the

number of employees between 7,000 and 37,000. (Ecorys, 2009)

On realizing the importance and potential of containerization and intermodal business,

Government of India decided to set up a separate Government-owned corporate body

for the facilitation and promotion of multimodal transport in the country. Container

Corporation of India Ltd (CONCOR) was incorporated in March 1988. With the

objective to manage change in India’s logistics architecture, to spearhead the

container revolution in the country, build and operate infrastructure linkages for rapid

and accelerated inland penetration of containerized international trade traffic; develop

and promote use of ISO containers for intra-country domestic general goods, duly

aggregating them for unit train operation on specified routes and encompassing the

flexibility of road transportation along with robust and economical unit train

advantage of countrywide rail network. Rail and road links were established with six

of the eleven major ports in the country, with dedicated container liner services

2

between Delhi and the ports of Mumbai, Nhava Sheva (JNP), and Chennai. CONCOR

would utilize extensive rail network for long hauls, while road vehicles would be

involved for door-to-door deliveries and short lead movements. Modal choice would

be dictated by the efficiencies and economies of transportation. In order to further

augment the dry port capacity the government of India has on the anvil an ambitious

multimodal project. The $ 90 billion Delhi Mumbai Industrial Corridor (DMIC)

project stretches over about 436,500 sq. km. in six of the states in India,

encompassing some 20 potential high-growth economic zones to serve as

manufacturing services and export-oriented hubs. DMIC will inter alia, create a chain

of free trade warehousing zones and freight logistics parks with rail network and road

connectivity. Hinterland potential for export-import container traffic handled at ports

in India is estimated to be at least 70%; actual movement of full containers from and

to hinterland locations is currently less than 35%. Rail-borne container movement

between ICDs and gateway ports currently is in the 25% range; with growing

incidence of outsourcing and offshore manufacturing, the market for containerizable

cargo in intermodal transport has changed radically in recent years. Major

manufacturers now go farther and farther offshore to capture low labor cost, low

taxes, better market accessibility, and other advantages.

In 2005, RITES a multi disciplinary consultancy organization under the

administrative control of Ministry of Railways was accorded the responsibility to

undertake a study on rail container movement in India. The main objective of the

study was to identify capacity constraints and formulate policy guidelines for opening

this sector to private operators. According to the report the government expected

quadrupling of volumes within ten years. The report also stated that the capacity of

the public sector operator viz CONCOR had reached a saturation point and would not

be able to bring about desired level of efficiency and growth. It further went on to

state that a level playing field vis-à-vis CONCOR was essential for further growth and

development of this sector.

Acting on the guidelines mentioned in the report prepared by RITES the private sector

logistic service providers were granted licenses to operate block container trains on

pan India basis in 2006. Expecting a sustained economic growth 14 logistic service

providers commenced operations in 2007-2008. However right from the beginning the

new entrants were handicapped due to lack of adequate infrastructure such as rail

terminals and container rail wagons. They were forced to enter into alliances with the

public sector competitor and also had to pay a charge for usage of the rail terminals.

3

The proverbial last straw for the new entrants manifested itself by way of collapse in

demand as a result of financial meltdown resulting in capacity under utilization. It

may eventually lead to reestablishment monopoly of the public sector. The

elimination of the private sector will lead to the erosion of the country’s competitive

advantage. This paper argues that in order to avoid such a predicament the

government should actively encourage partnership between the public and the private

sector. It could result in spreading of risk, optimal utilization of assets, sharing of

information and a rational pricing policy ensuring benefits for all stake holders.

Theoretical Background:

Michael Porter (Porter, 2000) in his seminal work on the competitive advantage

theory has argued that, rather than static focus on cost minimization, competition is

dynamic and rests on innovation and the search for differentiation. According to him,

a firm’s competitive position depends on two major aspects, operational effectiveness

and strategies. Thus in order to remain competitive, a firm must maintain operational

effectiveness while at the same time creating strategies which can distinguish itself

from existing/potential competitors (Porter, 2000).

4

Firm Strategy, Structure

and Rivalry

Demand Condition

Related and SupportingIndustries

Factor Condition

Chance/Random Factors

GovernmentInfluence

Porter (1990) argued that there is no one common strategy or management theory

which can explain all the behavior of firms in a sector because different management

ideologies exist like personal beliefs and company culture. Rather than static, a firm is

actually an evolutionary creature where past experiences and personnel have direct

implications on future strategies and development. Nevertheless, empirical evidence

suggested market factors are not necessarily the only attributes which can manipulate

the direction of the “Competitive Diamond” fully. As suggested by Porter, even

within a typical market economy, its competitive structure is often influenced by

random/unexpected factors such as the recent financial Tsunami and, perhaps more

importantly, the government. Rather than a core player, however, Porter insisted that

government should only play a catalytic role through promotion of a favourable

economic environment for firms to compete at a fair platform, e.g., enforcing

standards in service quality, encouraging competition, introducing and enforcing

antitrust policies, providing necessary aid, etc. He further adds that the government

should not participate in company’s management and competitive strategies because

direct participation of government will lead to ineffectiveness and bureaucratic culture

(Porter, 1990). According to Juhel (2001), in the port industry, government should

achieve three missions, namely catalyst mission (e.g. finances transport assets which

are unlikely to get access to private or alternative financing sources, creates regulatory

enabling environment, etc.), statutory mission (e.g. ensures navigation safety, coastal

management, etc.) and facilitation mission (e.g. public governance, helps trade

facilitation process, initiates trade integration, etc.) Indeed, governmental influence

within the industry can still be found worldwide, either in regional or national scales

(Slack B, 1999). For example, state aids can still be found in many European ports

(Heaver, T, 2002) while the public sector is also often involved in port projects like

dredging and widening river channels1. In Western Europe, for example, the role of

government in ports differs considerably between countries, where the Benelux

countries, France, Germany and the UK all have port policies.

Porter’s theories have largely explained the competitive structure of an industry, with

the roles of firms and market environment being clearly defined. However, its

emphasis on whether government should only play a complementary role within the

market is certainly an issue which is highly debatable especially in the current

1

5

circumstances. As will be discussed in the case of Indian dry ports in this paper, the

role of government should not only be restricted to the backseat, but should be

modified by playing a pivotal role in deciding the ‘balancing point’ within the

‘Diamond’.

Research Methodology:

Before getting on, it is necessary to note that, given the exploratory nature of the

study, apart from desk research and documental review, the authors had also

conducted on-site in-depth interviews with various relevant personnel. The interviews

have been done either telephonically or in person. For each question, the interviewer

has summarized, when necessary, the answer and transcribed the results of the

interview. More than 30 interviews had been conducted, with interviewees including

dry port operators, government officials, and consultants who were involved in Indian

dry port construction and development. Although the details of different interviews

differed, the core questions asked were as under;

1. The impacts of government’s policies on dry port sector

2. The competitive structure of the industry.

3. The objectives for entering the industry.

4. Major recommendations for improvement of dry port policy.

(For the sake of simplicity and illustration the information and opinions of these interviewees will be referred as ‘anecdotal information’).

The Rationale for Modified Government Policy

Given the uneven distribution of dry ports within the country, with about 40%, 30%

and 30% being located within the southern, western and northern regions respectively

(the central and eastern regions are conspicuous by the almost negligible presence of

dry ports) (CONCOR, 2007), it led to congestion of a few dry ports and breakdown of

infrastructure on one hand, but massive under utilization of most dry ports on the

other. Unlike European dry ports the Indian dry ports due to scarcity in financial

resources, lack of technological and management know-how, have never been

innovative and long term efficiency-enhancing investments and R&D like RFID and

GPS systems were often not considered. This situation was further aggravated by the

6

government’s policies on labor protection which bred inefficiency, sloth and

indiscipline and the cost of such inefficiency was often borne by the manufacturing

and service sector.

Indeed, the special considerations shown to public sector companies like CONCOR

and CWC in the sector had also contributed to the problems as mentioned above. The

public sector dry ports often provided generic solutions in solving non-standardized

demands in different regions, thus raising the question on whether dry port services

were really customer-oriented (UNESCAP, 2009).

To resolve this problem the Indian government set up an inter ministerial committee

for approval of applications for dry ports was set up to facilitate single window

mandatory clearances, payments, incentives, certifications, customs presence etc. The

legal and liability framework too has been improved by implementing the Multimodal

Transportation of Goods Act and refining the Motor Vehicles Act. The Government

also accepted the World Bank proposed concept of landlord ports and have handed

over the terminal operations of ports of JNPT, Chennai, Tuticorin, Vishakhapatnam

and Kochi. Based on similar principles, the Indian government had recently

encouraged the private sector, often foreign, to operate dry ports at numerous

locations within the country, often through the sale/lease of facilities to the private

sector under attractive terms. It had also through its commercial organization like

Central warehousing Corporation entered into several joint ventures with private

sector companies to manage facilities on BOT basis. Indeed, apart from enhancing the

efficiency of the supply chain, the government also anticipates the participation of

foreign firms in the operation and management of dry ports as a means of increased

foreign incomes (through various means like land rents and taxes) and the transfer of

technology and know-how. As a response to this initiative, in the past few years,

several multinational logistic service providers like Schenkers, Kuhne & Nagel and

Prologis, along with the shipping companies like APL, MSC and Maersk, had entered

this sector2. Referring back to Porter’s Competitive Diamonds, the participation of

foreign investments was to enhance the quality of the ‘Diamond’, so as to boost the

quality of the supply chain within the country, and thus the competitiveness of Indian

manufactured products in the global market. It should be emphasized once again that

2

7

the stated objective of the government for the construction of a dry port is not only to

make profits from operations but also to reduce the risk of non reliable performance in

the supply chain.

Indeed, given the massive number of such dry ports established within the country

(and the number of employees being employed) as mentioned earlier, it would

potentially pose a political tragedy to the Indian government if these dry ports were

forced to close down due to the competitive advantages derived by the newly

established private sector operated dry ports. In such circumstances the government

while attempting to display impartiality has ignored the reality of the early startup

advantages granted to the public sector dry ports.

One also has to bear in mind about the low value of most of the cargoes handled by

dry port operators, where almost 50% of the imports comprise of waste paper, iron

scrap and cotton waste, while there was hardly any significant value addition to

exports such as handicrafts, brassware, raw cotton, tea and other agricultural products

(CONCOR, 2007). International trade of such products is highly competitive and

slightest addition to costs can render the goods uncompetitive especially where goods

are price sensitive. It should also be taken into consideration the fact that most of the

goods handled by the operator are seasonal in nature especially the agricultural

products like tea. As such the volume also fluctuates with the festive seasons,

fluctuations in the currency markets, increase in cost of credit and other inputs.

The core dilemma of the Indian government lies about how it can balance the dry port

‘Diamond’, enhancing its efficiency on the one hand, while at the same time

maintaining the survival of public sector dry ports before any fundamental but long

term solutions, i.e., significant structural reforms, can take place. Indeed, the

competitive structure of the dry port industry does not only have an economic aspect,

but political and social aspects would also pose equally (if not more) significant

implications. Given the problems as discussed in this section, it seemed to indicate

that, in some cases, within the Indian dry port ‘Diamond’, it was the government

which brought in foreign players as an attempt to ‘imbalance’ the Diamond, while at

the same time, as will be discussed below, it is also the government which plays a

pivotal role in ‘rebalancing’ the Indian dry port ‘Diamond’ but without neutralizing

8

the early startup advantages derived by public sector ports operated by state-owned

corporations, notably CONCOR.

The Conundrum of Dry Port Pricing:

In order to conduct the various activities, land resources are essential for dry port

operators. A dry port is essentially a land intensive industry especially where the land

is located in a central market place and is connected to a railway network. This is the

first issue where the pricing policy encounters a major hurdle: what is the value of the

land? Under what terms and conditions is it made available to the dry port operators?

A piece of land located in a central place is a scarce commodity and has a fairly high

opportunity cost and several potential claimants. Such a land can be used for

residential or commercial purposes in addition to tourism, recreation etc. There is also

the issue of environmental and health hazards. This important land aspect demands

harmonious reconciliation by authorities and other stakeholders.

As dry port related infrastructure was considered a public good serving collective

interest of the entire nation by assisting in expansion of markets, it was considered to

be the sole duty of the state. This was entirely true in the past when India followed a

central plan model of socialist form of governance. It also allowed for mass

production, low marginal costs and achieving of international competitive advantage.

With some exceptions dry port capacity was developed ahead of existing demand

from industry, agriculture or commerce. This was done in the hope that the industry

and trade activities would pick up subsequently in the wake of the dry ports. As large

capital requirement and long gestation period was expected, the development of dry

port infrastructure was nationally considered to be the prerogative of the public sector.

The discussions of harmonizing pricing policies tend to overlook the fact that past

investments were not market driven. Massive amounts of public monies either directly

or indirectly by way of overt and covert subsidies were funneled into dry port

development enabling the public sector operators to consolidate such a strong market

position. This strength of theirs allows them to adopt pricing policies which would

deter new entrants on one hand while bankrupting existing competitors. If this trend is

allowed to continue, it will lead to oligopolies at best and monopolies at worst.

9

The buildup of large well spread dry port capacities with the help of public

funds and helpful government policies has led to discouraging new

competitors from making additional investment in the sector. This is because

creation of large capacity has a direct impact on the pricing policy; as such it

would be interesting in ascertaining the parameters which are considered while

planning the size of the dry port and deciding upon the pricing tariff.

Establishing the optimum size of a Dry Port is an iterative decision which has

to satisfy a number of techno-commercial-legal requirements. The optimum

size of dry port is derived from projections of existing and future demand for

dry port services. The aspect of optimum size becomes important because of

the investment factor and competing demand for urban land from other sectors

such as residential, commercial etc. Another important factor to consider when

planning the requirement of stacking area is the “peak-factor”.

The facility also has to be economically viable for the management and attractive to

users, to the railways for full train load movements; to other transport operators;

seaports; shipping lines; freight forwarders etc. must have certain minimum amount of

traffic.

Pricing of services depends on the norms for financial evaluation of each project.

Each organization follows its own norms. Some organizations do not consider the cost

of land as a cost of the project, but consider the cost of land as an investment. Indeed,

the value of land usually appreciates significantly once the Dry Port is up and

running, making this venture an attractive proposition. Rail transport pricing is

dependent on the haulage rate charged by Indian Railway. Movement of empty

containers, as well as empty (naked) wagons is also charged. Operators have to pay

stabling charges if the rakes are detained outside the Dry Ports for want of space

inside the ICD. The operator has to keep aside some amount for underload running

and for contingencies such as force majeure. Road operators are a force to reckon

with in India. This sector is characterized by highly fragmented ownership of goods

vehicles. But this is also their strength. The operators are nimble footed and rush in

where the returns are favorable. They impose a ceiling beyond which rail operators

can not raise their prices.

10

CONCOR began its operations from Dry Ports which were built on land leased from

railways at attractive terms. In its early years, CONCOR had to pay lease charges

based on the number of containers handled, with no correlation with the area had

leased. This resulted in CONCOR cornering as large a terminal as it could and

developing it in phases. This not only provided them with adequate room for

expansion, but generated huge cash surpluses for fuelling its rapid growth. In several

instances the ground rent received from stacking of containers was more than the total

operating expense of the terminal, which also included the land lease charges paid to

the government.

In order to recover the costs such as land acquisition, leveling, paving, access roads

etc, if the dry port operator charges a price higher than its competitor with the

assumption that its competitors will also follow suit and the additional income would

offset the loss due to fall in demand, then its assumption might be proved wrong. As

price setting in consultation together by all operators is impractical and also

considered illegal, it does not occur at least officially. Thus the dry port operator

might loose a bigger portion of the total market than it had bargained for increasing

bigger losses. Hence, most of the operators do not increase their prices in tandem. As

such the user is left with no alternative but to accept whatever service is available at a

price stated by the operator. This results in the user not being able to achieve

competitive advantage.

About 60% of the containers handled by the gateway port are transported to

hinterland dry ports with the balance 40% being handled locally. It should also be

noted that the level of containerization is only 18% in India against a global level of

over 70%. It is not only profitable for the rail operator to transport containers by train,

but it is also very cost effective for the dry port user. It costs less than 0.05 USD per

ton km to transport a container by railways as against 0.15 by roadways. As such,

with rising demand, low costs and good returns on capital, it is not surprising that

CONCOR enjoys a very healthy competitive advantage. In order to maintain its

dominance of the market, CONCOR constructed 57 dry ports with a total of combined

area of 5 Million square meters. About 40% of this area is paved and suitable to stack

11

containers. Based on the capacity utilization formula developed by Dr.Itsuro

Watanabe, the combined dry port capacity of CONCOR is over 10 Million TEUS. At

present, it handles only 2 Millions TEUS. This huge excess capacity allows it to

completely dominate the market quite effectively resulting in driving out the

competition from the market.

The creation of excess capacities and adoption of suitable pricing policies can act as

entry barrier to competition. This fact can be illustrated by the following example.

Assume dry port A as a government owned (incumbent) facility which has dominant

market position. This has been established over several years with the help of public

expenditure both in the dry port itself and also in the related infrastructure like access

roads rail lines etc. As it has developed capacities well in excess of existing demand,

it is able to meet substantial part of the trade. The dry port A is also a strong

proponent of cost recovery pricing policies in general but, at the same time it is

allowed to ignore historical costs and

Cost Recovery Pricing Model.

thus its prices, both current and future, do not reflect nor do they take into

consideration the actual and real costs of past investments. The demand for its

services is given by D1D2 and its costs are pegged at OC while its price is OP. Its

average cost curve is given by AC1. The economic surplus of dry port A is given by

ABCP.

AC2

CCC2AC1

D2

0Q2Q1

P

C

d 2

d 1

A

Throughput

B

D1

12

Cos

t/p

rice

Now consider a privately owned dry port B (entrant). It has entered the field of dry

port logistics operation recently because it foresees a good profit opportunity for itself

due to the rapidly increasing trade. In addition to its late entry the dry port B cannot

expect any subsidies from government either, because it is privately owned. But the

government recognizing the importance of competition as well as the necessity of

private sector investment, (as it will reduce its own burden) welcomes the private

sector. However the dry port B hopes that in near future the demand for its services

would be d1d2. Its average cost curve is given by AC2. The dry port’s throughput is

OQ1 at price of OP. The balance traffic Q1Q2 is left for dry port A.

But the dry port B is forced to match the pricing policies of dry port A and peg the

price for services charged by it at P. However the dry port B is unable to reduce its

costs and as a consequence its average cost curve remains at AC2. At this price level

the new entrant will only incur losses and will be driven out of the market. On the

other hand the public sector dry port is able to keep its own prices low and can also

reclaim its market share. Such pricing policies would indeed act as entry barriers for

new entrants.

Need for Public Private Partnerships:

While many governments have reformed their utilities without private participation,

some seek finance and expertise from private companies to ease fiscal constraints and

increase efficiency. By engaging the private sector and giving it defined

responsibilities; governments broaden their options for delivering better services.

The range of options for public-private partnerships has expanded enormously over

the past 30 years. Agreements between public and private entities take many shapes

and sizes for both new and existing services. At one end of the spectrum is a

management or service contract wherein a company is said to pay a fee for a service.

At the other end is full privatization or divestiture (outright sale), where a government

sells assets to a private company. Outsourcing has become another popular option;

here a private company might handle an aspect of service, such as billing, metering,

transport or even cleaning. Hybrid models of private-public partnership have seen

explosive growth in recent years, especially with the development of a more

13

diversified pool of emerging market investors and operators with local expertise.

These models often rely on simpler contractual agreements and blend public and

private money to diversify risks.

It is obvious that the dry port operators will not voluntarily adopt rational pricing

policies. The eventual result would be oligopolies at best or monopoly at worst. Thus

there is a need for a tariff regulator. But is it possible to impose pricing discipline and

would be fair to all competitors? The main question is how an efficient pricing system

can be implemented taking unto account variety of individual constraints and different

input costs. At the most it would be possible to impose a top ceiling on prices. But it

is definitely not implementable nor desirable to impose a lower limit on prices. On the

other hand, if the government sets the prices, then it will end up biting more than it

can chew and will be accused of partiality by all stakeholders. This is because

government administered pricing policies cannot benefit everybody equally. As such,

no policy intervention on pricing matters would be acceptable to the operators. There

is also the issue of transparency of accounting systems and legalities which the

government will have to take into consideration before it decides upon pricing

policies. Thus the role of a tariff regulator would be only ornamental.

A public private partnership (PPP) involves the private sector in aspects of the

provision of infrastructure assets or of new or existing infrastructure services that

have traditionally been provided by the government.

In the present circumstances where the very survival of the private sector dry port

operators is at stake and which also jeopardizes the future growth of the dry port

service industry, the most viable and practical solution should be the further coming

closer of the public and private sector dry port operators by forming public-private

partnerships. In this regard the government should not only act as a facilitator but

should actively encourage the formation of public-private partnerships which could be

done in various manners. It would not only lead to optimal usage of assets,

rationalization of pricing policies and enhance efficiencies but will also pave the path

for future growth and achievement of sustainable competitive advantage.

Conclusion:

14

The role of dry ports in developing the international trade of the country is critical. It

is also connected with the provision of infrastructure, public investments, fiscal policy

and overall economic development. The issue of rational pricing policy of dry ports

has arisen due to the need felt by all the concerned stakeholders including the

government. It is a result of the growing intensity of competition and lightening of

fiscal constraints.

The pricing policy addresses the user rather than the tax payer at large who is also

affected as a final consumer. It is the gateway port operator who will have to bear the

burden of higher prices for inefficient services. There is also the issue of appreciating

asset prices especially land and alternate uses to be considered. Though the effect on

the consumer is not obvious at first sight, it will definitely be felt by the nation as a

whole. It will depend upon the percentage of services cost in the final consumer prices

as well as international trade and integration with global supply chains. The

government through the active encouragement of public private partnerships can set

guiding principles on pricing policies and prevent cartelization on one hand and

creation of monopolies / oligopolies on the other. It would necessitate compilation of

relevant statistics, adoption of standardized account system, greater transparency and

equitable dispersal of relevant information to the citizenry.

It would result in enhanced efficiency of dry port operations which will eventually

benefit the user by imparting competitive advantage to the country’s international

trade and its seamless integration in global supply chains.

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15

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15. Slack, B. (1999): “Satellite terminals: a local solution to hub congestion?”, Journal of Transport Geography, vol. 7, no. 4, pp. 241-246.

16. Watanabe, I. (2001): Container Terminal Planning – A Theoretical Approach, World Cargo News (WCN) Publishing, Great Britain, pp 58-61.

17. UNESCAP (2009) “Monograph series on Dry Ports”

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