New framework for coastal economic zones to be out soon: Shipping ministry

The majority of maritime projects, which are a mix of port modernisation, capacity enhancement, cruise terminals, port connectivity and coastal shipping, would be executed in the next five years

The Union government is drafting an institutional framework for the execution of coastal economic zones (CEZs) in consultation with states and will soon finalise it.

“The government is taking inputs from various stakeholders like state governments and central line ministries based on which an institutional framework for CEZs will be finalised,” the shipping ministry said in a reply to queries under the Right to Information Act.

The proposal for developing a prototype CEZ has been taken up by the central government. CEZs are an initiative of the ministry of shipping. “The proposal still is in the initial stage, and issues like challenges and way forward are being thoroughly discussed… Therefore, no deadline for the completion of the CEZ can be set at this time,” said the ministry.

As part of the National Perspective Plan under the Sagarmala programme, the government had in July 2016 announced building 14 CEZs, which will be aligned to ports in maritime states. These will house coastal economic units for setting up manufacturing facilities. For promoting port-led industrialisation, the 14 CEZs will cover all maritime states and Union Territories.

The Sagarmala programme has four essential features — port modernisation, port connectivity, port-led industrialisation, and coastal community development. The CEZs fall in the third category.

Ports handle 90 per cent of the country’s EXIM cargo by volume and 70 per cent by value. Gujarat alone caters for 25-30 per cent of cargo traffic. Connecting coastal areas with ports through port-led development was planned because proximity to the port substantially brings down the logistics cost of a company.

The regions selected for the proposed CEZs are Kachchh, Suryapur and Saurashtra in Gujarat; north and south Konkan in Maharashtra; Dakshin Kanara in Karnataka; Malabar in Kerala; Mannar, VCIC South and Poompuhar in Tamil Nadu; VCIC Central and North in Andhra Pradesh; Kalinga in Odisha; and Gaud in West Bengal.

A majority of maritime projects would be executed in the next five years, which are a mix of port modernisation, capacity enhancement, cruise terminals, port connectivity, and coastal shipping.

The National Perspective Plan of the Sagarmala programme envisions a potential saving of Rs 21,000 crore-Rs 27,000 crore, annually, in the movement of 230-280 million tonne of key commodities such as coal, cement, fertilisers, iron and steel, food grains, and POL (petroleum, oil and lubricants) by 2025.