In response to India’s national security concerns, restrictions were imposed in July 2020 on public procurement from countries sharing a land border, particularly targeting China. However, existing orders placed before the restrictions came into effect remain unaffected
Investigations have raised concerns over the vulnerability of several key Indian ports, including Vizhinjam port and Jawaharlal Nehru port, due to the dominance of Chinese crane manufacturer Shanghai Zhenhua Heavy Industries Company (ZPMC) in the Indian market. A US Congressional probe highlighted worries about potential surveillance and sabotage linked to ZPMC’s equipment, sparking discussions on cyber security measures in global port operations.
“ZPMC Shanghai is a major supplier of maritime cargo handling equipment, including cranes. Industry estimates put the installed base of ZPMC at 75-80 per cent globally, and the same holds true for India,” says Davinder Sandhu, co-founder & chairperson of Primus Partners, a business and management consulting firm.
ZPMC, a major supplier of ship-to-shore (STS) cranes globally, holds a significant share of the Indian market, with estimates suggesting its involvement in 75-80% of installations in the country. Despite assurances from ZPMC regarding cyber security, concerns persist, prompting actions such as the recent executive order signed by US President Joe Biden to bolster cyber security at American ports.
In response to India’s national security concerns, restrictions were imposed in July 2020 on public procurement from countries sharing a land border, particularly targeting China. However, existing orders placed before the restrictions came into effect remain unaffected. Adani Group and Gateway Terminals India (GTI) are among the major recipients of ZPMC cranes in India, with the former securing a substantial share for the Vizhinjam International Deepwater Multipurpose Seaport project.
“While GTI does not receive any financial support from the government or its undertakings, it is reportedly configured to operate with ZPMC cranes, making the installation of cranes of any other make challenging,” Sandhu explains.
Efforts to promote domestic production under the Make in India initiative have been highlighted as a long-term solution to reduce dependence on foreign suppliers. However, challenges remain in scaling up domestic production to meet the demands of the port infrastructure sector.
Meanwhile, recent revelations from a US Congressional investigation shed light on similar security concerns surrounding ZPMC-made cranes in the US. The findings underscored the presence of communication equipment with ambiguous purposes on ZPMC cranes at US ports, raising fears of potential remote control capabilities and cyber vulnerabilities.
Despite the challenges and uncertainties, ZPMC continues to thrive financially, with significant revenues reported both globally and in India. However, the spotlight on security risks associated with its equipment may prompt a reevaluation of global procurement strategies in the maritime industry.
