The impressive growth rate of India’s GDP has been squarely influenced by burgeoning
international trade of the country. As 90% of the international cargo is being handled by
the ports of India, as a natural corollary, the volume of traffic handled by the ports are on
continuous rise. Of course, the liberalization of economies all over the world has increased
the exports and imports of almost all the countries. With India’s GDP growing at over 9%
per year and the manufacturing sector enjoying double digit growth rates, the country is
currently spending about 13% of GDP on the logistics sector. Different types of cargo are
handled at the ports, like dry bulk cargo such as coal, iron ore, liquid bulk cargo, container
cargo, crude oil cargo and Liquefied Natural Gas (LNG). Increased usage of container cargo has increased the developments in the port industry. India currently has 12 major ports and
185 minor/intermediate ports spread across the vast coastline of 7,517 km. They handle
almost 90% of India’s total foreign trade. The exposure of economies to trade and its related
activities gave prominence to the development of ports. Ports and shipping can be considered
as the engines of growth for any country. The importance of ports and its related infrastructure
plays a vital role in the growth of a nation and its economy. The development of ports is
needed in India for its growth and better economy. In today’s globalized economic
environment, the patterns of international trade, particularly those of manufactured products,
are quite complex and increasingly diverting from stylized neoclassical trade models based
on the set of assumptions including perfect competition, constant return-to-scale
technologies, costless information, and no external effects. The actual patterns are
significantly affected by various institutional factors based on policy interventions by the
governments, such as trade and investment policies, or on provision of public goods, both
in terms of physical and institutional infrastructure that support production as well as trading
activities by private enterprises.
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