Shipping Ministry policy on location of greenfield ports soon

The policy would be useful to resolve issues such as those that developed the Centre decided to set up a major port in Tamil Nadu

As new ports face viability issues, the Centre plans to firm up a policy guideline on the location of new ports.

The policy would be useful to resolve issues such as those that developed the Centre decided to set up a major port in Enayam, near Colachel, in Tamil Nadu.

The Kerala government had opposed the decision as the new port would be within 35 km radius of the Vizhinjam port, which was developed by Adani Ports and Special Economic Zone (APSEZ).

The transshipment container terminal at Vizhinjam would be developed under design, build, finance, operate and transfer (DBFOT) mode in four phases by APSEZ.

The agreement granting concession for 40 years to the Adani Group was signed on August 17, 2015 between Adani Vizhinjam Port Pvt Limited and Government of Kerala for the development of this green-field project.

Earlier this month, the Cabinet approved setting up a major port at Enayam, near Colachel in Tamil Nadu. This would be the country's 13th major port. A Special Purpose Vehicle (SPV) will be formed for development of Colachel port with initial equity investment from the three existing major ports in Tamil Nadu -- V O Chidambaranar Port Trust, Chennai Port Trust, and Kamarajar Port Limited.

Ministry of Shipping is preparing a concept paper on the subject that would be presented in the Maritime States Development Council, likely to take place in the next 2-3 months.

Opinions and suggestions of the states would be sought during that meeting to decide the future course of action, an official told Business Standard.

The concept paper is expected in a month's time, the official said adding, at present there is no such guideline on minimum distance between two ports.

Industry experts feel that any such policy would only streamline port and port lead development in the country.

Maritime states should come forward in the formulation of this policy. Though bringing them on board is a challenge but at least they should make an attempt, Vishwas Udgirkar, Senior Director, Deloitte India said.

There are 12 major ports in India -- Kandla, Mumbai, JNPT, Marmugao, New Mangalore, Cochin, Chennai, Ennore, V O Chidambarnar, Visakhapatnam, Paradip and Kolkata (including Haldia) and together they handle approximately 61 per cent of the country's total cargo traffic.

The aggregate capacity at major ports increased from 871.52 million tonnes per annum as on March 31, 2015 to 965.36 million tonnes in 2015-16.

To meet the future growth in cargo traffic, a roadmap has been prepared to increase the capacity of major and minor ports from 1500 million metric tonnes per annum (MMTPA) in 2015 to more than 3000 MMTPA by 2025.

According to data available on the website of Maritime and Port Authority of Singapore, ports handled 12.5 million containers in the first five months of 2016, as compared with 13.4 million in 2015.