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Govt should incentivise coastal shipping

Govt should incentivise coastal shipping

The ports and terminals developed under public private partnership (PPP) model in Gujarat have been performing quite well over the years, in terms of the efficiency parameters, says Amrendra Kumar Rakesh, Vice Chairman & CEO, Gujarat Maritime Board.

What are the steps taken by the Gujarat Maritime Board (GMB) to bring efficiency in ports in the state?
Gujarat has adopted a public private partnership (PPP) model for the development of ports and terminals, and these ports have been performing quite well over the years, in terms of the port efficiency parameters.

For the ports in Gujarat, the board has been actively undertaking the projects related to modernisa¡tion of the ports by introducing mechanisation projects like dust separation, capacity augmentation, revival of the old ports, etc. Some of the ports where investments are being made to upgrade port infrastructure are the ports of Okha, Bhavnagar, Navlakhi, and Porbandar.

In one of the major initiatives under GMB, we have planned to undertake complete mechanisation and environment management activities at Navlakhi port at a total cost of Rs 374 crore. We are also envisaging the construction of an additional new jetty along with back up area on a reclaimed area at a cost of Rs 221.6 crore. The mechanisation projects include barge unloading, stacking, reclaiming and truck loading, wagon loading, and conveyor system. Overall, as a result of our efforts to improve the efficiency of the ports, the traffic at these ports has shown a significant increase of 17.9 per cent over the previous year.

What reforms and policies have been introduced by GMB to improve ease of doing business in the port sector of Gujarat?
Over the years, the board has streamlined the approval procedure in the port sector. We have also released a document on ease of doing business in the port sector in Gujarat. At present, the maritime board has a defined approval process for the following:

  • Port projects on initiative of the developer
  • Port projects through MoU
  • Shipbuilding yards
  • Leasing of GMB plots or godowns
  • Captive jetty
  • Dismantling of ships at Alang ship recycling yard Further, we have prepared a detailed ´Guidelines for granting NOC, Permission for land reclamation and allotment along the coast of Gujarat´, wherein a two-stage approval process is stipulated before starting the reclamation work. These guidelines would bring uniformity in decision-making. The guidelines have been sent to the government for its approval.

According to you, what initiatives from the government do you foresee to bring the Indian port sector on a growth trajectory?
Port development is a subject in the concurrent list of the Constitution. Hence, synchronisation of the efforts of the state and the Centre is very critical. The central government has initiated several programmes like Sagarmala, Maritime Invest, etc. The Sagarmala project focusses on port-led development. Gujarat has been focussing on port-led development for quite some time now, and Sagarmala is a welcome initiative. Further, the coastal cargo movement has a huge potential in India. The share of coastal shipping in India is low as compared to Europe and other nations in Asia, where it has flourished due to focussed policy interventions. The Centre should support the coastal shipping by offering special incentives. The government has proposed financial incentives for modal shift of cargo.

What is the current capacity of the ports under GMB? What steps would you take to further improve their performance?
During the year 2014-15, GMB has added a total capacity of 35 MMTPA, taking its total capacity to about 422 MMTPA. The board has over the years maintained a good growth rate in terms of port capacity addition. Going forward, GMB is expected to continue to contribute a lion´s share in the total Indian port capacity. GMB has a good number of projects in the pipeline at present. The future capacity would be coming from the expansion of the private ports and captive jetties, and from the development of the new ports or terminals. A large part of the future capacity will be created for POL, containers, and dry bulks. As per the Maritime Agenda 2020, the capacity of GMB ports is envisaged to reach 864 MMTPA by 2020.

Do you have any plans to develop new ports in Gujarat? What investments do you envisage for the same? What kind of model would you prefer when it comes to development of ports?
We have initiated several greenfield port projects and currently, these projects are at different stages of development. Some of these ports are likely to come up soon, while other greenfield ports would be developed over the years. The projects that are at advanced stages of development are Chhara port, Dahej North port, and LNG terminal at Jafrabad and Nargol port. For the development of the Chhara port, Shapoorji Paloonji has been selected as the developer and the concession agreement has been signed. It will be developed with estimated investments of Rs 1,200 crore. Similarly, for the development of a greenfield port at Dahej (north of existing ports and jetties), the concession agreement was signed between GMB and Sterling Port Ltd in June 2014, and the construction is expected to be completed by April 2018. The company envisages investing about Rs 4,060 crore in the project.

Swan Energy Ltd (SEL) has been selected to develop an LNG Port along with Floating Storage and Regasification Unit (FSRU) near Jafrabad with estimated investments of Rs 4,500 crore. Cargo Motors & Israel Ports will develop Nargol port with an investment of Rs 4,000 crore.

Please tell us about the major achievements of GMB during the last one year?
The last year has been a very good year for the Gujarat port sector. GMB was an active participant in the seventh edition of the Vibrant Gujarat Summit in January 2015, facilitating private investment opportunities in the port sector, wherein more than 92 MoUs or investment intentions were inked for the development of port and shipping related infrastructure. This is a significant increase from the previous year, wherein about 63 MoUs were signed for the port sector. Among the significant developments on the port front, Adani Ports & SEZ Ltd have signed an MoU with GMB for the development of an LPG Terminal at Mundra port.

GMB has signed an MoU with the Taiwan Shipbuilding Association for technical collaboration in the field of shipbuilding activities in Gujarat. The European water, lake and river system development association (EVAK), a leader in developing water areas in Europe, has also signed an MOU with GMB along with leading maritime sector firms from Finland. The idea is to explore opportunities in Gujarat for technical collaboration in transfer of tech¡nology and know-how in the field of shipbuilding, repairing, and recycling. GMB has also initiated the modernisation of ship recycling yard and has sought a soft loan from Japan International Cooperation Agency (JICA) for modernisation of Alang.

GMB has also facilitated various port sector projects during the last year. In the significant developments, Cairn Energy India Pty Ltd will construct twin SPMs at Bhogat for transshipment of crude oil. GMB has also approved the appointment of M/s GSPC LNG Ltd as sub-concessionaire for the development of an LNG Terminal at Mundra.

During the year 2014-15, GMB handled 336 MMTPA, registering a growth of 8.5 per cent over the last year.


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