Evaluating Operational Efficiency Trends in India's Major Ports: A Data Envelopment Analysis (DEA) with Variable Returns to Scale

Abstract

This research assesses the operational efficiency of India’s major ports over the period 2005–2019 using an input-oriented, Banker, Charnes, and Cooper (BCC) Data Envelopment Analysis (DEA) model with Variable Returns to Scale (VRS). While earlier studies assess port efficiency at isolated points in time, systematic longitudinal evidence remains limited. This work examines trends over time and measures each port's performance against an efficient frontier derived from empirical data. The analysis uses a dataset compiled from the annual reports of the Ministry of Ports, Shipping and Waterways, available on the Open Government Data (OGD) platform. Findings indicate that while a few ports consistently operate on the frontier, most reach best practice only intermittently. A comparison of average efficiency scores before and after 2014 underscores the significant impact of port modernization initiatives. Moreover, the frequent emergence of specific ports as benchmarks reveals their lasting competitive advantages and broader influence across the system. For ports identified as inefficient, the slack analysis provided precise figures for potential input reductions without affecting output. The extended timeframe and a DEA approach customized to account for sectoral variations bring fresh insights, offering practical recommendations for port managers on enhancing performance and optimizing resource allocation.