Logistics

Shipping Ministry to set up new co to develop port rail projects

NK Kurup Mumbai | Updated on March 10, 2018

The 12 major ports will have equity stake in the new firm



As part of its initiative to fast-track port connectivity, the Shipping Ministry proposes to incorporate a new company to undertake rail projects at all Government ports.

The new entity, which will have equity participation from the 12 Major Ports, is expected to implement all new rail projects and also to undertake the existing rail line operations with in the port area, a Government official said.

Nitin Gadkari, Union Shipping Minister, discussed the Ministry’s proposal with head of government ports at a meeting in Mumbai on Monday. The proposed company will have an initial authorised capital and of ₹100 crore. The official, however, said the proposal is at an initial stage and the details are yet to be worked out.

Currently, rail projects at ports are implemented by special purpose vehicles created by individual ports with the support of Rail Vikas Nigam Ltd. However, projects often get delayed under this model.

Ports like Mumbai and Kolkata operate their own rail lines within the port area. These ports own locos and maintain the rail lines themselves. Mumbai port railway handles around four million of tonnes of cargo a year. The proposed port rail infrastructure company is expected to take over all the railway operations with in the port.

Congestion problem

Rail and road connectivity is a major problem at several ports for movement of cargo from and to ports. Delay in evacuation of imported cargo creates congestion at most ports.

Rail Budget for the current year had indicated plans to implement new projects through public private participation.

Gadkari, who reviewed the Major Ports’ performance, (his first such exercise after taking over as Shipping Minister) has asked chairmen of ports to ensure timely implementation of projects. He assured them the freedom to take independent decisions within the powers under the Major Ports Act.

However, he is said to have given a clear message that in his scheme of things there will be no place for non-performers.

The Minister wants the port cargo capacity in the country to be doubled in the next five years from 800 million tonnes to 1,600 million tonnes.

The capacity creation at major ports has been tardy at Major Ports in the past few years due to a variety of reasons.

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Published on July 29, 2014
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