1 Indian Port Sector By Hans Ole Madsen – CEO, South Asia for A.P. Moller-Maersk Port Pipavav

2 About A.P. Moller-Maersk >Established in Svendborg, Denmark in 1904 >More than 110,000 employees in over 125 countries >Global group turnover of USD 40 Billion

3 Main Business Activities Container Shipping related activities >Maersk Line and Safmarine are market leaders in global container services >Network of more than 550 container vessels and 1.4 million TEU >APM Terminals operates more than 45 terminals >Multimodal Supply Chain Management services through Maersk Logistics

4 Main Business Activities Other Shipping related activities >Transport of crude oil, refined products and gas by Maersk Tankers >Maersk Supply provides supply vessels for anchor-handling, cable laying etc >Maersk Contractors is involved in mobile production units and drilling rigs >Over 260 vessels and rigs operated

5 Main Business Activities Energy >Production and exploration of oil and gas >Production Activities in Denmark, United Kingdom, Qatar, Algeria and Kazakhstan >Exploration activities in the North Sea (Denmark, United Kingdom, Norway and Germany), Algeria, Morocco, Angola, Oman, Brazil, Surinam, Colombia and Turkmenistan

6 Main Business Activities Retail and other industry >Supermarkets and hypermarkets in Europe and UK >Brands include the Føtex stores, the Netto stores and the Bilka hypermarkets >Shipyards in Denmark, Germany and the Baltic countries >Industrial production of plastic products >Star Air engaged in contract parcel flying in Europe >50% ownership of Martinair Holland engaged in air freights and charter service for passenger

7 Our Presence in India >Maersk Line operating in India since 1952 >The leading container shipping line in India >Nationwide presence through 33 offices >Employs over 5,500 people in India >Established the 1 st Private CFS in Nhava Sheva in 1994 >Pioneered the back-office (BPO) concept in the maritime industry >Established the 1st Maritime Training Academy by a foreign shipping line in India >Among the 1 st participants in the privatisation of rail freight in India

8 >The 3rd Container Terminal at Nhava Sheva harbour within JNPT >Converted existing bulk terminal on BOT for 30 years >Joint Venture with CONCOR >Handling capacity to be 1.4 mio TEU >Total quay length 712 metres >Draft limited to channel draft of 12.5 metres >Located in Gujarat on the west coast of India to handle containers, bulk and liquid cargo >Container volumes handled to exceed 250,000 in 2006 >Projected Container terminal capacity of 1.3 mio TEU >Bulk cargo in 2006 apx 2.5 mio tons >Total quay length of 725 metres APM Terminals in India

9 Current Scenario >Growth projections indicate continued demand for capacity >Encouraging response from both local & international companies for Port development projects in India >Major international container port operators have a presence in India and are eyeing new projects

10 Regulatory Environment >Model Concession Agreement >Major v/s Minor Ports >Tariff Regulation >Major Port Trusts Act

11 Financing >Need for long term financing/debt options >Current interest rates high thus increasing the overall cost and risk >Viability gap funding scope to be broadened

12 Public Private Partnership in Ports >Private investment attracted towards port projects with reasonable returns and payback period >Support infrastructure to be developed by the Government to ensure success of the PPP model >Government to undertake infrastructural development where payback is commercially unviable but essential for overall development such as capital channel dredging, breakwater, rail/road linkages etc >PPP to be used as a tool to speed up infrastructure development and not as a replacement of Government spending

13 Productivity and Efficiency >Berth productivity has improved at some Indian ports from 20 moves per hour in the 90’s to moves per hour >The benchmark is now higher >Emma Maersk, the worlds largest container vessel, had berth productivity of 540 moves per hour at Yantian