Imagine a seaport located hundreds of kilometers away from the ocean. This is essentially what a dry port does. It brings all the functions of a coastal port to landlocked regions, allowing businesses in interior India to clear customs, store containers, and process international shipments without traveling to the coast.
India currently operates 134 such inland container depots across the country. For states like Rajasthan, Uttar Pradesh, and Madhya Pradesh with no access to the sea, these facilities serve as the only gateway to global trade. The government approves these installations under strict regulations to ensure they serve genuine trade needs while maintaining customs security and operational efficiency.
What Exactly Is a Dry Port
A dry port is an inland container depot located far from the sea. It works like a seaport but sits hundreds of kilometers away from the coast. These facilities handle import and export cargo, perform customs clearance, and store containers under government supervision.
The Central Board of Indirect Taxes and Customs defines it as “an off seaport facility having such fixed installations or otherwise, equipment, machinery etc. providing services for handling clearance of laden import, export containers for home use, warehousing, temporary admissions, re-export etc under customs control.”
| Feature | Seaport | Dry Port (ICD) |
|---|---|---|
| Location | Coastal area | Inland, away from sea |
| Transport Mode | Ships, rail, road | Rail and road only |
| Distance from Coast | 0 km | Typically 200+ km |
| Customs Clearance | Yes | Yes |
| Container Storage | Yes | Yes |
| Ship Operations | Yes | No |
India currently operates 134 notified dry ports. Private logistics operators typically build and run these installations, though state and central government undertakings also operate some facilities. Minister of Ports, Shipping and Waterways Sarbananda Sonowal confirmed that “the ICDs or Dry Ports are typically setup by Private Logistics Operators or by State or Central Undertakings.”
How Dry Ports Differ From Seaports
Dry ports perform most functions of a seaport except ship loading and unloading. They receive containers by rail or road from coastal ports. Exporters bring cargo to dry ports for customs clearance before shipping. Importers collect cleared goods from these inland facilities.
A dry port has its own automated system with a separate station code. The Ministry of Commerce allots codes like INTKD6 or INSNF6. Filing of customs manifests, bills of entries, shipping bills and all clearance activities happen at the dry port itself.
The key difference is independence. A dry port is “a self-contained Customs station like a port or air cargo unit” where complete customs processes occur. This makes it equivalent to a coastal port in terms of customs functions.
Why India Needs These Inland Facilities
Landlocked states have no access to seaports. Rajasthan, Uttar Pradesh, Madhya Pradesh, Chhattisgarh, Jharkhand, and Haryana depend entirely on dry ports for international trade. Without these facilities, exporters and importers would travel hundreds of kilometers to coastal customs offices.
| Benefit | Impact on Trade |
|---|---|
| Customs Clearance Near Production | Reduces transport costs and time |
| Reduced Port Congestion | Faster processing at coastal facilities |
| Lower Logistics Costs | Saves on transport, inventory, demurrage |
| Direct Train Movement | Full container trains run port to inland |
| Regional Development | Trade facilities near industrial clusters |
The government circular explains that dry ports “serve as concentration points for long distance cargo movement and transit facility, making available customs clearance facility near the centers of production and consumption, free movement of cargo at gateway ports and decongesting the ports.”
Rail transport becomes cost-competitive beyond 200 kilometers. The policy notes that “rail transport is price competitive with road transport when the lead distance is more than 200 kms.” This makes dry ports economically viable for locations far from coasts.
Which States Have Most Facilities
Uttar Pradesh leads India with 15 inland container depots. The state sits far from any coast and has massive industrial production. Gujarat follows with 14 facilities despite having extensive coastal infrastructure and major ports.
| State | Number of Dry Ports | Why So Many |
|---|---|---|
| Uttar Pradesh | 15 | Large population, far from coast, major industries |
| Gujarat | 14 | Industrial hub, export-oriented manufacturing |
| Maharashtra | 14 | Industrial base, serves interior regions |
| Tamil Nadu | 11 | Manufacturing clusters, IT exports |
| Haryana | 10 | National capital region, automobile industry |
| Rajasthan | 8 | Landlocked, textile and mineral exports |
| Madhya Pradesh | 8 | Central location, minerals and agricultural exports |
| Andhra Pradesh | 7 | Emerging industrial state, tech exports |
Northern states dominate because they sit farthest from ports. Uttar Pradesh facilities serve cities like Agra, Kanpur, Meerut, Moradabad, Saharanpur, and Varanasi. Multiple depots operate in Greater Noida, NOIDA, Dadri, and Ghaziabad to serve the National Capital Region.
West Bengal operates only three dry ports despite being a major industrial state. Bihar and Jharkhand have minimal infrastructure with one facility each. Northeastern states remain severely underserved with only Assam operating a single facility.
What Container Freight Stations Actually Do
Container Freight Stations or CFS also handle containers but work differently from dry ports. A CFS is notified under Section 8 of the Customs Act, not Section 7. This means it cannot operate independently.
| Aspect | Dry Port (ICD) | Container Freight Station (CFS) |
|---|---|---|
| Legal Status | Section 7, independent | Section 8, linked to parent port |
| Location | 200+ km from port | Within 50 km of port |
| Customs Functions | Complete clearance | Examination only |
| Document Processing | Done at ICD | Done at parent port |
| Main Purpose | Inland trade gateway | Port decongestion |
| Volume Threshold | 7,200 TEUs yearly | 1,200 TEUs yearly |
A CFS cannot have independent existence. It must link to a customs station within the jurisdiction of the Commissioner of Customs. In a CFS, only examination of goods occurs besides stuffing and de-stuffing of containers. The parent customs house handles manifest processing, declarations, and assessment.
Currently, most CFSs sit within 50 kilometers of ports. They concentrate heavily in western and southern India near Mumbai, Chennai, and Gujarat ports. Their primary purpose is decongesting coastal ports rather than serving distant hinterlands.
How Govt Controls New Development
The government divided India into three zones to control where new dry ports get built. This system prevents over-concentration in some areas while encouraging development in others.
| Zone | States | New Approval Status |
|---|---|---|
| Green | HP, Bihar, Jharkhand, West Bengal, NE States, Telangana, J&K | Open for all proposals |
| Blue | Uttarakhand, UP, Chhattisgarh, Odisha, AP, Goa, Karnataka, Kerala | Case-by-case only |
| Red | Delhi, Gujarat, Maharashtra, Punjab, Haryana, Rajasthan, Tamil Nadu | Restricted, exceptional cases |
Green zones have low infrastructure and get priority for development. Blue zones accept proposals only for specific trade-generating locations lacking facilities or where existing ones are over-utilized. Red zones have adequate infrastructure and new development faces restrictions.
Distance rules prevent overcrowding. No new dry port can open within 100 kilometers of an existing facility. The policy also discourages building facilities within 200 kilometers of seaports to push developments toward genuine hinterland locations.
What Requirements Applicants Must Meet
Building a dry port requires meeting strict standards. The government set these requirements to ensure only viable facilities get approved.
| Requirement | Specification |
|---|---|
| Minimum Land | 7 hectares (4 hectares customs area, 1 hectare DPD/DPE) |
| Annual Volume | 7,200 TEUs both ways (600 per month) |
| Land Ownership | Owned or 30-year lease minimum |
| Operating Experience | 3 years minimum in logistics |
| Distance from Port | 200+ kilometers preferred |
| Distance from Other ICD | 100+ kilometers minimum |
Green zone states get relaxed requirements with only 3 hectares for customs notified area plus 1 hectare for direct operations. When land is leased, “the lease agreement with lessor must be for period of 30 years” according to the circular.
Applicants must have “prior experience of operating as CCSP or should have other trans-border logistics experience such as logistics service provider including customs brokers, transporters, freight forwarders, shipping lines and port terminal operators.”
How Approval Process Actually Works
An Inter-Ministerial Committee meets every three months to review applications. The committee checks present availability of facilities, their capacity and current usage, trade generation potential, and the need for new installations.
| Stage | Duration | Action |
|---|---|---|
| Commissioner Review | 30 days | Feasibility examination |
| IMC Member Comments | 30 days | Review by all members |
| IMC Meeting | Twice yearly | Approval or rejection |
| Letter of Intent | 12 months | Infrastructure development |
| Maximum Extensions | 24 months | Additional construction time |
After approval, applicants receive a Letter of Intent valid for 12 months. This can extend by another 12 months once. Exceptional cases may get two additional 6-month extensions. After 36 months maximum, incomplete proposals get rejected.
The circular clearly states that “any investment made by the prospective developer before the approval of IMC shall be at the risk of developer.” This prevents premature construction before official approval.
What Infrastructure Standards Apply
Dry ports must meet extensive infrastructure requirements before starting operations. Rail-linked facilities need three tracks for loading, unloading, and locomotive release. High mast lighting towers must stand 30 meters tall with LED flood lights providing minimum 20 lux at ground level.
| Infrastructure | Standard |
|---|---|
| Approach Road | 15 meters wide with drainage |
| High Mast Lighting | 30 meters high, 20 lux minimum |
| Weighbridge | 60 MT capacity, certified |
| CCTV Coverage | All zones, 3-month storage |
| Yard Paving | M40 concrete or M30/M50 blocks |
CCTV networks must cover entry and exit gates, warehouses, storage areas, and container yards with night vision recording. Systems must record and hold data for three months minimum. Weighbridges above 60 metric tons must stay calibrated and certified.
All container and cargo handling operations must start and get recorded through IT systems. Manual job order generation is prohibited. Container location tracking is mandatory with real-time information accessible via apps or websites.
How Performance Gets Monitored Closely
Customs commissioners conduct annual audits and inspections of all notified facilities. Facilities failing to meet minimum volume thresholds for four consecutive financial years face de-notification.
The circular states that “ICDs not meeting the minimum prescribed threshold performance for four consecutive financial years will be considered for de-notification by the Board.” Currently, only 25 dry ports handle 83 percent of total volume, showing concentration in few facilities while others operate below capacity.
Jurisdictional commissionerates must list functional and non-functional facility counts on websites with monthly volume figures, infrastructure profiles, and compliance status. This transparency helps track performance and plan future development across India’s growing inland trade network.
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