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Port of Opportunities!

Port of Opportunities!

With an outlay of Rs 1,773 for the year 2017û18, the government has set the ball rolling for the port sector. To promote port-led development in India, Rs 600 crore has already been allocated for the Sagarmala Programme. Besides, the internal resources of ports are also utilised for the development of the port sector.
<p> Maritime trade in India is a major facilitator for economic growth, accounting for 90 per cent of EXIM volumes and 72 per cent by value. It is estimated that the ports in India have the potential to contribute nearly 2 per cent to the gross domestic product (GDP) growth. The Government of India has therefore embarked on the Sagarmala Programme with a vision to reduce logistics cost for both domestic and EXIM cargo and utilise the waterways to their potential. </p>
<p> Sagarmala envisions taking advantage of the 7,500 km long coastline and 14,500 km of potentially navigable waterways in providing the necessary sustenance for economic growth. During the period April to September 2017, the country has recorded a growth of 3.24 per cent and has handled 326.4 million tonne of cargo as against 316.1 million tonne handled during the corresponding period of the previous year. The volume speaks for itself! </p>
<p>Since the EXIM trade sees an unprecedented growth, a clogged port infrastructure (congestion, connectivity, shallow draft etc.) may slowdown the overall growth. Hence, a root canal treatment is needed. </p>
<p>Exemplifying the success stories of China, Korea, Japan and Singapore, where the ports have led the country’s growth strategy, <span style="font-weight: bold;">Amitabh Kant, CEO, NITI Aayog </span>says that there is a need for conglomeration of all the stakeholders for proper execution of an export-focused strategy. For India to increase its current growth rate of 7.6 per cent, it is essential to penetrate the global markets, which only ports can drive. He pointed out that land is not a challenge and all that is required is optimum utilisation of available resources.</p>
<p>This year, the Union Budget allocated Rs 2.41 trillion for the transport sector as a whole, including rail, road and shipping. With major push to infrastructure in the budget of 2017, the focus is on developing infrastructure and enhancing last mile connectivity in coastal areas, which would enable ports to be the drivers of economic development. </p>
<p>About 2,000 km of coastal connectivity roads have been identified for construction and development, which will facilitate better connectivity of ports and hence spur economic activities. Continued focus on the Sagarmala Programme – including development of coastal economic zones (CEZs) and improvement of hinterland connectivity – is expected to boost the maritime sector in the long term and stimulate economic growth.</p>
<p>Sagarmala, the flagship programme of the Ministry of Shipping, hinges on capacity expansion and modernisation of ports along India’s coastline, enhancement of port connectivity to the hinterland, port-led industrialisation to promote trade and sustainable development of coastal communities. Under this programme, around 415 projects have been identified, which are expected to mobilise investment of more than Rs 8 lakh crore and generate approximately 1 crore new jobs, including 40 lakh direct jobs, over a period of 10 years. These projects are expected to increase port capacity to more than 3,000 mtpa by 2025 and generate annual logistics cost savings of close to Rs 35,000 crore.</p>
<p>In a written reply to <span style="font-weight: bold;">Rajya Sabha, Mansukh Mandaviya, Minister of State </span>says that out of 415 projects under Sagarmala, 199 focus projects are to be taken up in the first three years. <span style="font-weight: bold;">(Refer table Summary of 199 focus projects under Sagarmala from 2016-2019 on page no. 72.)</span></p>
<p>Aiming to double the share of domestic waterways (inland and coastal) in the modal mix, Sagarmala also focuses on the development of inland waterways for both passenger and freight transport to decongest existing road traffic.</p>
<p> <span style="font-weight: bold;">A fillip to port-led development</span><br />
The concept of ‘port-led development’ is central to the Sagarmala vision. Port-led development focuses on logistics-intensive industries (where transportation either represents a high proportion of costs or timely logistics are critical success factors). The population in adjoining areas would have to be sufficiently skilled to participate in economic opportunities on offer. The synergistic and coordinated development of four components, namely, logistics-intensive industries, efficient ports, seamless connectivity and requisite skill base, will lead to unlocking economic value and stimulating economic growth across sectors.</p>
<p>For holistic growth, Sagarmala Programme includes more than 400 projects at an estimated infrastructure investment of more than Rs 8 lakh crore in areas such as:</p>
<p>A.Port modernisation and new port development <br />
B.Port connectivity enhancement<br />
C.Port-linked industrialisation<br />
D.Coastal community development<br />
<br />
Projects worth Rs 1 lakh crore are already under various stages of implementation and development. More than Rs 390 crore has been released for 35 projects under the Sagarmala Programme, including unique and innovative projects, such as capital dredging for Gogha-Dahej RO-Pax Ferry Services Project and RO-RO Services Project at Mandwa. Techno-economic feasibility report (TEFR) is under preparation for development of underwater viewing gallery and a restaurant at Beyt Dwarka Island.</p>
<p> <span style="font-weight: bold;">Port modernisation &amp; new port development</span><br />
A total of 189 projects worth Rs 1.42 lakh crore have been identified for port modernisation and new port development. The master planning for 12 major ports has been finalised, under which 142 port capacity expansion projects (totalling Rs 91,434 crore) have been identified for implementation over the next 20 years. Out of this, 46 projects are already under implementation or are likely to be awarded.</p>
<p>’At present the Ministry has finalised TEFR for six ports located at Vadhavan, Enayam, Sagar Island, Paradip Outer Harbour, Sirkazhi and Belekeri,’ <span style="font-weight: bold;">Nitin Gadkarai, Union Minister, Ministry of Shipping </span>told reporters in Mumbai recently. </p>
<p>While the detailed project report (DPR) has been prepared for the Sagar Island port, the ones for Vadhavan, Paradip Outer Harbour and Enayam are under preparation. For major port operational efficiency improvement, 69 initiatives have been implemented and 80 mmtpa of port capacity has been unlocked so far.</p>
<p>An official from the MoS on the basis of anonymity said, ‘In the current and subsequent financial year, the Ministry will implement 33 projects worth Rs 37,000 crore.’ </p>
<p> <span style="font-weight: bold;">Port connectivity enhancement</span><br />
Under the second pillar of Sagarmala, the Ministry has identified around 170 port connectivity enhancement projects worth Rs 2.3 lakh crore. Of these, the official said, ’54 projects worth Rs 1.56 lakh crore will be implemented during the year 2017-19.'</p>
<p>Since the Railways also plays an important part in carrying maximum loads, the government has decided to implement 27 rail connectivity projects of which 21 projects (~3,300 km, worth Rs 28,000 crore) are being taken up by the Ministry of Railways and six projects (~151 km, worth Rs 3,590 crore) are implemented through joint venture and non-government railway (NGR) model. ôPreparation of a DPR is underway for the heavy haul rail corridor between Talcher and Paradip,ö says an official from the Ministry of Railways. </p>
<p>Since the maximum number of freight movement is through road network, the Ministry of Road Transport and Highways and National Highways Authority of India had signed an MoU for the development of 79 port road connectivity projects, including 10 freight-friendly expressways. ‘We have already started implementing around 14 projects,’ said a former official from the Ministry of Shipping, who recently shifted to the Department of Justice. </p>
<p>Meanwhile, the government is already implementing five out of seven multi-modal logistics parks. </p>
<p> <span style="font-weight: bold;">Port-linked industrialisation</span><br />
According to the Ministry as many as 33 projects with estimated investment of Rs 4.2 lakh crore have been identified for port-led industrialisation. The government has already prepared the perspective plans for 14 CEZs covering all the maritime States and Union Territories. The master plans will be prepared in a phased manner with four CEZs to be taken up in phase 1. What is more, 29 potential port-linked industrial clusters have been identified across energy, materials, discrete manufacturing and maritime sectors. Master plans have been prepared for maritime clusters proposed in Gujarat and Tamil Nadu. The Ministry is also developing a special economic zone (SEZ) at JNPT, a free trade warehousing zone at Ennore and smart port industrial cities at Kandla and Paradip. </p>
<p> <span style="font-weight: bold;">Coastal community development</span><br />
The government has identified projects worth Rs 4,216 crore for coastal community development. Under this scheme, the Ministry is part-funding select fishing harbour projects in convergence with the Department of Animal Husbandry Dairying and Fisheries (DADF), one of the departments in the Ministry of Agriculture. </p>
<p>More than Rs 56 crore has been released for eight projects so far, across Karnataka, Kerala, Tamil Nadu and Maharashtra. In-principle approval has been given for the development of deep sea fishing vessels and fish processing centres in convergence with the DADF.</p>
<p>A number of projects to enhance livelihood and employment opportunities for the coastal communities have been identified. The following are the skilling projects funded under Sagarmala:</p>
<li>Rs 10 crore has been released as the first instalment for safety training of workers in Alang-Sosiya shipyard</li>
<li>Rs 6.9 crore has been released as the first instalment for coastal districts skill training project under phase 1 of Sagarmala DDU-GKY convergence project</li>
<li>The Ministry is undertaking skill gap analysis in 21 coastal districts. Projects for the same to be implemented under phase 2 of Sagarmala DDU-GKY convergence project</li>
<li>The Ministry is also conducting cutting-edge skill training in ports and maritime sector, and is considering proposals for setting up a multi-skill development centre (MSDC) linked to Jawaharlal Nehru Port Trust (JNPT) and a centre of excellence for shipbuilding</li>
<li>JNPT-Antwerp Port Training and Consultancy Centre was inaugurated on February 6, 2017</li></ul>
<p> <span style="font-weight: bold;">Promoting coastal shipping</span><br />
The Ministry of Shipping has formulated a revised central sector scheme to provide financial support to major and non-major ports and state governments for creation of infrastructure for movement of cargo and passengers by sea or national waterways. Under the scheme, projects for construction or upgrading of exclusive coastal berths for coastal cargo and berths or jetties for passenger ferries; mechanisation of coastal berths; capital dredging for operation of non-major ports; construction of breakwaters for existing and greenfield non-major ports; construction of berths or jetties in national waterways and islands by state governments and union territories; and construction of platforms and jetties for hovercrafts and seaplanes will be considered for assistance.</p>
<p>The Ministry of Shipping has taken up projects worth Rs 2,302 crore for financial assistance under the coastal berth scheme of the flagship Sagarmala Programme. The projects under this scheme are distributed over eight states with the highest number of projects in Maharashtra with 12 projects, followed by 10 in Andhra Pradesh and Goa, six in Karnataka, three in Kerala and Tamil Nadu, two in Gujarat and one in West Bengal. Out of the 47 projects, 23 worth Rs 1,075.61 crore have been sanctioned for total financial assistance of Rs 390.42 crore and Rs 230.01 crore has been released to major ports, state maritime boards and state governments. The remaining 24 projects are under various stages of development and process of approval.</p>
<p>The most recent beneficiaries of the scheme were JNPT and Karnataka government respectively for developing coastal infrastructure at JNPT, Karwar Port and Old Mangalore Port. Around Rs 25 crore was sanctioned for the construction of coastal berth (270 m x 30 m) at JNPT. Rs 114.4 crore was sanctioned to the Karnataka government for extension of the existing southern breakwater by 145 m, construction of a new north breakwater of 1160 m, construction of coastal berths at Karwar port and construction of coastal berth and capital dredging at Old Mangalore port.</p>
<p> <span style="font-weight: bold;">- Rahul Kamat</span></p>


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