The country’s infrastructure sector accelerated by 5.3 per cent in November 2009, backed primarily by growth in steel and cement production in the month. The six core sectors, which contribute 26.7 per cent to the overall Index for Industrial Production (IIP), had grown 0.8 per cent in the corresponding month of 2008. Finished (carbon) steel production grew at the highest rate—11.7 per cent—during the month, against a decline of 6.3 per cent in the corresponding period of 2008. Cement production also picked up to post a growth rate of 9 per cent in November, marginally up from 8.7 per cent in the month in 2008. Production of petroleum refinery products also grew by 4.9 per cent on a year on year basis, as against a contraction of 1.1 per cent in the year ago period.

Infrastructure investment in India is set to grow dramatically. India has become a major outbound investor and people are engaging with Indians to seek investment into their countries, said the Minister for Road Transport and Highways, Mr Kamal Nath, in Davos. According to investment banking company Goldman Sachs, India's infrastructure sector will require US$ 1.7 trillion investment in the next 10-years. It also added that such investment would come more from the domestic market than overseas.

Furthermore, India is likely to emerge as a major hub for production of quality steel products, according to Ratan Jindal, vice-chairman, managing director and CEO of Jindal Stainless Steel (JSL). The International Steel Exhibition ‘Indinox’, to be held at Ahmedabad in January, will portray India as a major destination for manufacturing steel products. The domestic demand, especially from the railways, and varied use of stainless steel, will also act as a catalyst in growth of the steel industry in India.

Notably, truck sales, a key indicator of goods movement, zoomed by an astronomical 201.1 per cent in December 2009. According to data released by the Indian Foundation for Transport Research and Training (IFTRT), though April-December truck sales rose by 11.9 per cent, the normally weak offtake month of December belied all calculations by registering a 201.09 per cent jump in the sales of trucks in the 5-49 tonne range and operating on intra-state, countersigned inter-state and on national permit routes.

Meanwhile, the public private partnership appraisal committee (PPPAC) has given its nod for the proposed US$ 806.4 million mega container terminal at the Chennai port. The port trust is likely to award the project by March 2010. The project would be developed in phases between 2013 and 2018. The Tuticorin Port Trust (TPT) is planning to award projects worth US$ 371 million over the next two years. The proposed investment would enable the port to increase its cargo handling capacity by another 20 million tonnes.

Safexpress, one of the largest supply chain and logistics Companies in India, has launched its ultra-modern logistics park in Pune. This is company’s ninth warehouse in India.

The Rajasthan State Industrial and Investment Corporation Limited (RIICO) has signed a memorandum of understanding (MoU) with Container Corporation of India Limited (Concor) to set up a US$ 75.23 million multi-model logistic park (MMLP) in the state. The park would have facilities for a container yard, a modern container handling system, cargo handling, warehousing, etc.

Ports

India's logistics sector is witnessing increased activity—the country's major ports have posted a 12.8 percent year-on-year (y-o-y) rise in cargo volumes in November 2009. The Public Private Partnership Appraisal Committee (PPAC) has approved four projects worth over US$ 897.7 million to be developed through the public-private partnership (PPP) mode in a move to boost capacity at the major ports in the country. The four port projects have been cleared by a panel headed by Mr Ashok Chawla, Finance Secretary. These include projects for development of a mega container terminal at the Chennai Port, a project to develop a multi-purpose berth at the Paradip Port in Orissa, development of the second North Cargo Berth at Tuticorin Port in Tamil Nadu and development of a container terminal at the New Mangalore Port.

The Cabinet Committee on Infrastructure (CCI) has approved a proposal to develop the fourth container terminal at the Jawaharlal Nehru Port (JNPT), the country's busiest port, at an estimated cost of US$ 1.44 billion. The government also cleared a proposal to build standalone container handling facility at Mumbai port at a cost of US$ 129.6 million. The project would be implemented within two years from the date of the award of the project. Meanwhile, cargo handled by the major ports in the country, a key indicator of economic activity, grew for the fifth consecutive month at 49.1 million tonnes (MT) compared to 45.3 MT in the corresponding month last year. According to data from the Indian Ports Association (IPA), for the third quarter ended December 2009, the major ports have registered cargo growth of 10.7 per cent compared to the same period last year, while sequential growth has been 9.7 per cent.