Public-private partnerships (PPPs) have been fairly successful in the port sector. So far, 45 projects involving capacity additions of 283.52 million tonnes (mt) have been completed at major ports. Another 34 projects with 282 mt capacity are under construction.
The past year saw the launch of one of the biggest programmes for the maritime sector, Sagar Mala. Its major components are port capacity enhancement and efficiency improvement, hinterland connectivity, port-led development, and coastal regional development.
Consultants are working on drawing up the national perspective plan, and the first draft report has been received. An origin-destination study has been done to ensure integrated planning of cargo movement in the country. The study estimates a potential savings of around Rs 210 billion per annum if the coastal route is used for goods transportation. The introduction of a shipbuilding incentive package incentive was another huge achievement for the Ministry of Shipping (MoS).
There are several issues as far as the port sector is concerned. One of them relates to the Tariff Authority for Major Ports (TAMP). The government is in the process of deciding whether TAMP needs to be continued or not. The final decision on this is expected to be taken within one or two months. The issue of migration from 2005 to 2013 tariff guidelines is a little more complicated, and the MoS is in discussion with various stakeholders, and looking at all possible options. There are some matters that are also sub judice.
The MoS is also looking at ways to revise the present model concession agreement (MCA), based on the recommendations of the Kelkar Committee and other committees set up previously by the erstwhile Planning Commission. In the next two months, the draft report is expected to be prepared, which will then be put up for stakeholder consultation.
Development of new ports is also on the anvil. The MoS plans to set up new ports at Wadhwan, Maharashtra; Sagar, West Bengal; Dugarajapatnam, Andhra Pradesh; and Colachel, Tamil Nadu. The basic infrastructure will be done by the SPV formed by the major ports and the respective state governments, while the berths will be undertaken on PPP basis.
Recently, the Kelkar Committee has given some recommendations specifically for the port sector and general recommendations for the infrastructure sector, especially on how to handle various contingencies which arise during a long-term concession period (30 years). The Department of Economic Affairs is presently examining it in consultation with all other infrastructure ministries. They have recommended some kind of a tribunal structure to take care of the issues that need to be handled expeditiously for PPP projects.
Speedy evacuation of cargo is one of the major issues faced by Indian ports. In 2015, the MoS set up Indian Port Rail Company Limited (IPRCL) to improve last mile connectivity of ports. The company is already working on 24 projects. One of the very ambitious projects this company is anchoring with Coal India Limited, the Odisha government and Indian Railways is a Rs 100 billion worth heavy-haul line connecting IB Valley-Talcher to Paradip port. The line will use the latest technology for movement as well as for wagons. The pre-feasibility study has been done, and the detailed project report is under implementation. Meanwhile, the Ministry of Road Transport and Highways is coming up with a programme called Bharat Mala. Out of the six components of the programme, one relates to connectivity of ports and industrial areas.
Inland water transport (IWT) is one of the priority areas for the government. Since Independence, only five waterways have been declared as national waterways (NWs). However, the sector has picked up pace in the past two years. Substantial movement is expected on NW-1 within a year. The World Bank aided Rs 42 billion worth of projects. The Jal Marg Vikas aims to provide an environment-friendly, fuel-efficient and cost-effective mode of transportation, on NW-1. The MoS has also introduced a bill in Parliament for declaring an additional 106 rivers as NWs. After the inclusion of these 106 waterways to the existing five NWs, the total number will go up to 111.
Ease of doing business is another focus area of the government, and major steps are being taken by Indian ports for the same. These include complete enterprise resource planning for their internal system, introduction of radio frequency identification, etc. The MoS has also convinced the revenue department that it would be better off if ports put scanners for them on their own. Ports are also looking at the option of raising foreign-denominated loans so that project costs can be reduced.
Going forward, there is a need to bring in more efficiency in the decision-making power of the boards of the ports trusts. In this regard, various options are being explored including corporatisation. The MoS is also in the final stages of sending the entirely revamped Merchant Shipping Act to the cabinet. After cabinet approval, this will go to Parliament. w
Based on remarks by Rajive Kumar, Secretary, Ministry of Shipping