The Hindu Business Line : Port sector: Anchored to growth

With more than 95 per cent of the country’s foreign trade being sea-borne, the port sector is under pressure. Several development projects in major ports during the year have led to growth in traffic and capacity.

A.K. MOHAPATRA, SECRETARY, MINISTRY OF SHIPPING

Santanu Sanyal

Despite pressure from increased trade volumes, the port sector has handled the challenges well, says Mr A. K. Mohapatra, Secretary, Ministry of Shipping, who takes stock of the sector’s performance in 2007 and hopes for an even better showing in 2008.

Excerpts from an interview:

Port expansion

The year 2007 has been very fruitful for the port sector. Expansion and modernisation of ports was among the top priorities of the Union Government. Several development projects got under way in major ports during the year. This led to growth in traffic and capacity in major ports.

Between April and November, the traffic handled was 333.27 million tonnes (mt) as compared to 294.6 mt in the corresponding period of the previous year, registering a growth of 13.13 per cent. Capacity addition during the period was to the tune of 40 mt. Also, work was initiated in some of the major projects in the ports of Mumbai, Paradip, Visakhapatnam, Tuticorin, Chennai, Ennore and Kolkata.

Moves have been initiated to appoint a consultant for the preparation of a detailed project report for the deep-sea port project in West Bengal. The industrial relations situation was cordial. The retirement age of the workers, employees and officers in the port sector has been raised from 58 to 60 years.

Business plans

Pursuant to the decision of the Committee on Infrastructure, headed by the Prime Minister, the major ports engaged international consultants for preparation of their respective Perspective Plans for 20 years, which will include an Action Plan for seven years.

The Perspective Plans have been prepared for 12 major ports along with a consolidated National Development Plan. These are expected to serve as guides for major ports in preparing their Annual Plans and undertaking various development projects in future.

During the year, the issue of port connectivity was adequately addressed in consultation with the Railways and the National Highway Authority of India. Work on several port connectivity projects has been expedited. The Railways completed some of the projects for Haldia, New Mangalore, Kandla and JNPT. The road connectivity to Visakhapatnam port was also completed.

The counter obligation of the Union Government to provide rail and road connectivity to Vallarpadam international container trans-shipment terminal project, being executed by DP World, is being fulfilled and a high-level team is monitoring the progress of work.

Since the volumes of imports and exports are steadily increasing and since more than 95 per cent of the country’s foreign trade is sea-borne trade, the port sector is under heavy pressure. The imports of food-grains and fertilisers have added to this pressure. Fortunately, our ports have been able to handle this challenge efficiently. Work on some dredging projects for deepening navigable channels has been taken up. The cost escalation of Paradip port’s dredging work has been approved.

The government has also approved the project for undertaking capital dredging (phase I) by Ennore Port Ltd. The contracts for dredging at Adam’s Bridge and southern parts of Palk Bay/Palk Strait under Sethusamudram Ship Channel Project were awarded to Dredging Corporation of India and 28 million cubic metres of dredging has been undertaken so far. Dredging in Adam’s Bridge has remained suspended following court orders.

Outlook for 2008

For undertaking development works in major ports, a provision of Rs 2,000 crore has been made in the Eleventh Plan period.

There are proposals for construction of 15 new berths during this Plan. By 2011, the country’s port sector should have a capacity of 1.5 billion tonnes, comprising one billion tonnes of capacity in major ports and 500 mt in non-major ports. Right now the capacity in the port sector is 504 mt, including 230 mt of the non-major ports.

We are very hopeful about non-major ports, which have projected to increase their capacity to 839 mt by the end of the Eleventh Plan. We’re working with the maritime States in this regard.

By the end of the Twelfth Plan, the port sector must have the capacity of two billion tonnes. The draft Model Concession Agreement for Public Private Partnership projects has been finalised and is under process for approval of the government.

We would also like to take up some of the major dredging projects, including dredging at Jawaharlal Nehru port. To boost dredging capacity, particularly capital dredging, a mega alliance is being formed with the participation of several port trusts and the public sector shipping company. Internationally, the dredging scene is oligopolistic.

Fishbone approach

The development of inland waterways is to receive a good deal of attention in coming years. Right now, we have three National Waterways, to be increased to six. The new additions will be Brahmani-Mahanadi river system to be linked to Paradip port, Krishna-Godavari river system to Buckingham Canal and the Barak river in the North-East.

In fact, we’re working on an umbrella project for the North-East. We call it ‘fishbone approach’. The essence of the approach is to link the feeder rivers with the two main rivers, namely, Brahmaputra and Barak, to have a kind of spread effect in regard to their utilisation. We’re also initiating steps to make the existing National Waterways fully functional.

The thrust of the future policy for the port sector should be directed towards addition to capacity through creation of new ports, as well as capacity addition in existing ports, through construction of new berths and mechanisation of operations, better port connectivity covering not only proximate connectivity within a radius of 10/15 km but also connectivity to hinterland.