January 26, 2023
Illustrative image from a similar project. (photo by CMA-CGM)
On January 20, 2023, the Asian Development Bank (ADB) announced that a $131 million deal including the JICA-funded "Leading Asia's Private Infrastructure Fund" (LEAP)(*1) had been signed with Nhava Sheva Freeport Terminal Private Limited (NSFTPL), which comprises an investment of $61.4 million in the form of a direct loan from ADB and $69.6 million from LEAP.
Since 2020, the impact of COVID-19 has spread globally, causing a disruption to the supply chain due to the sudden change in the balance of supply and demand. Even now, despite the settling down of the situation, the volume of goods being distributed is on an upward trend due to changes in consumer behavior. For the recovery and further development of the economy, it is essential to build a stronger supply chain. In particular, container ports in India, as the base of the logistics network linking Asia, Europe, and other regions, must strengthen their competitiveness and improve the efficiency of terminal operations.
The loan aims to support the refurbishment, operation, and maintenance of the Jawaharlal Nehru Port Container Terminal (JNPCT), located in Navi Mumbai, part of the Mumbai metropolitan area in India, on a PPP basis (*2) under a 30-year contract awarded to NSFTPL. It will contribute to the reduction of logistics costs by easing congestion at the port and reducing greenhouse gas emissions through the electrification of facilities. The loan will therefore also contribute to the achievement of SDGs (Sustainable Development Goals) Goals 8 (Decent work and economic growth) and 9 (Industry, innovation and infrastructure).
JICA has been providing funds and expertise for the approximately 1,500-km-long dedicated freight railway system being constructed under the Western Dedicated Freight Corridor project along the Delhi-Mumbai Industrial Corridor. The expansion of the JNPCT, which will be connected with the Western Dedicated Freight Corridor, will address the increase in freight transport demand in India, thereby promoting comprehensive regional economic development in the area of the Delhi-Mumbai Industrial Corridor.
JICA will continue collaborating with countries and international organizations to promote quality infrastructure investment and contribute to social and economic development in developing countries and regions in line with the SDGs.
(*1) Leading Asia's Private Infrastructure Fund (LEAP) is a part of the follow-up measures for the “Partnership for Quality Infrastructure,” which was announced by the Japanese government on November 21, 2015. Targeting high-quality private infrastructure projects in the Asia-Oceania region, the fund provides assistance for such projects organized under various arrangements, including public-private partnerships. In March 2016, JICA approved a $1.5 billion investment in private sector investment financing for LEAP. Providing support for a wide range of sustainable infrastructure projects undertaken by the private sector in ADB member countries of the Asia-Pacific region, LEAP is directed at projects in fields such as the reduction of greenhouse gas emissions, energy efficiency, and the provision of medical services at reasonable prices.
(*2) PPP is an abbreviation for Public Private Partnership, which is a partnership between the public and private sectors aiming at more efficient and effective implementation of public projects.