PM Modi pitches for Rs 1 lakh crore investment to develop ports

Aims to more than double handling capacity to 3,000 mt by 2025

The Centre has prepared a comprehensive plan to increase India’s port handling capacity to 3,000 million tonnes by 2025 from the present 1,400 mt. The government envisages an investment worth Rs 1 lakh crore to meet this target, announced Prime Minister Narendra Modi in his inaugural speech at the maiden Maritime India summit.

The Union ministry of shipping is showcasing about 250 projects for investment opportunity in the sector. The proposed plan includes development of five new ports in addition to the existing 12 major ports and ongoing development at three new ones. He said a slew of initiatives, including the Sagarmala project, will help revive and restore India’s position in the global maritime sector. He added the Sagarmala project would allow leveraging the 7,500-km long coastline.

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The Jawaharlal Nehru Port alone registered a net profit of Rs 1,000 crore, helped by 12 per cent increase in efficiency. He, however, said this is just a beginning as the government wants to do more. “We are enhancing our own capacities of execution and implementation of ports,” he said.

Participate delegations in 1 session: “Sagarmalm port led development” at Maritime India Summit Jyoti Mukul

Modi said the Centre was engaging with regional and neighbouring countries to promote shipping and maritime security.

Modi asked investors to come to India with an open mind and has assured assistance on all fronts. He said, “This is the right time to come to India and an even better time to come via the sea route. Do not miss it.”

The PM said foreign direct investment (FDI) inflows have increased by 44 per cent since the government took over and has been the highest in the 2015-16. In FY16, the cargo handled by the major ports has also gone up significantly due to higher efficiency and lower turnaround time. India’s flagship companies in the maritime sector, including Shipping Corporation of India, Dredging Corporation and Cochin Shipyards, have garnered highest profits in 2015-16, compared to the previous year, he said.

 

He said in order to participate in global port projects a special purpose vehicle titled Indian Port Global Ltd has been formed. Currently, the Chabhar Port in Iran is being developed. Regarding corporatisation of major ports, the Union highways and shipping minister said the hurdle in this matter is more political in nature. “It is not a problem of the unions. It is a political problem. The Opposition parties want to establish that the government is pro-industrialists and again poor. So it is a fight for image,” he said, at a CEO roundtable at the summit.

Enlisting the initial efforts taken by the Centre, Modi said major ports have added 165-million tonne capacity, with record addition each year in last two years. The traffic in major ports has shown four per cent growth in the same period, despite global slowdown. Operating margins, which were on decline, have also improved. In FY16, operating profit of 12 major ports has increased by nearly Rs 670 crore. In a bid to offer a level-playing field to the major ports of the country, the ministry of shipping is determined to abolish the existing tariff-setting practices. “We want to close the TAMP (Tariff Authority of Major Ports) chapter soon and replace it with new system. We are sure about that. Discussions are on with the government but cannot give a timeline for this,” Gadkari said. The Centre will table a new Bill that will facilitate a model agreement by way of public-private partnership in the port sector. “In the next two months, we will have a new model agreement, hopefully by June 30. Ministry of shipping is coming up with a separate Bill to handle long-term concessional arrangement between port and terminal operators,” Shipping Secretary Rajive Kumar said.