Why the Ports Bill is raising States’ hackles

The Indian Ports Bill 2021 seeks to replace more than a century old Indian Ports Act 1908. The new Bill incorporates a number of international regulatory developments in the national legislation namely the “International Ship and Port Facility Security (ISPS) Code 2004, the International Convention for the prevention of pollution from ships (MARPOL) – (1983, 2005). It mandates port authorities to provide adequate “reception facilities” to ships to dispose of their waste.

The International Ballast Water Management (BWM) convention (2017) aims at preventing the spread of invasive aquatic species and potentially harmful pathogens in ships’ ballast water when it is released into port premises or adjacent environment.

The draft Bill under Chapter IX contains provisions for safety and security of ports and Chapter X for prevention and containment of pollution at ports and these provisions will apply to all ports in India — major and non-major and they are required to prepare a “Security Plan” and a waste reception and handling plan and will be subject to periodic audit by the Union government to ensure compliance. These are some of the welcome features of the proposed legislation.

The controversial provisions

Chapter II deals with establishment of a Maritime State Development Council by the Centre with the Union Minister as the Chairperson and Ministers in charge of ports in the Maritime States as members. It also includes the Secretary and Joint Secretaries of the Ministry dealing with ports. Surprisingly, neither the State Maritime Boards nor expert members on port administration and trade interests find a place in the Council.

The Council thus appears to be heavily loaded in favour of the Union government. It also proposes to make this Council a permanent body with wide-ranging powers to formulate a national plan for development of existing and new ports and to revise the plan periodically, monitor the development of major and non-major ports to ensure integrated development of major and non-major ports with the national plan.

Section 17, Chapter IV empowers the Union government to make a port non-operational if it is not in consonance with the national plan. Chapter XII, section 83 proposes heavy penalties for administrative lapses on Port authorities and officials ranging from ₹50,000 to ₹2 lakh or imprisonment up to six months or both. This excessive authority and power concentrated in the Union government relegating the maritime States into secondary position have led to the maritime States — Tamil Nadu, Kerala, Andhra Pradesh, Odisha and Maharashtra to lodge their protest and convey their objections to the Centre.

Need for more decentralisation

India has 12 major ports and about 212 non-major ports. Major ports come under the direct control of the Centre while all non-major ports come under the control of respective State governments. In 2000-01 Indian ports handled a total traffic of 369 million tonnes (major 281 and non-major 88) and the share of major ports was 76 per cent and that of non-major ports 24 per cent.

In 2020-2021 the total traffic handled at Indian ports reached 1,250 million tonnes (major 673 and non-major 577) but the share of major ports declined to 54 per cent while that of non-major ports increased to 46 per cent. There is every reason to believe that by 2030 non-major ports in India will overtake the major ports in cargo handling and the maritime State governments will be the main driving force to effect such developments.

The power and functions of the Maritime State Development Council suggest that it will assess the future development of existing and new ports both major and non-major and will formulate a national plan for development of major and non-major ports in India, revise such plans from time to time. This laudable objective will be difficult to implement due to familiar bureaucratic and procedural formalities. Establishment of a Maritime State Development Council will add an additional bureaucratic layer in port administration which will cause further impediments and delays in execution of port projects.

The British Government in 1962 appointed Lord Rochdale as Chairman of a Committee to study the organisation of ports and the committee recommended establishment of a National Ports Authority for British ports. The British government did not accept this recommendation but felt that ports should be left to the respective local authorities for development with local initiative.

The US has about 180 commercially significant ports but the Federal government does not involve itself in any integrated planning and development of ports. Canada has seen a record number of official and unofficial reports on organisation and reorganisation of ports but there is no central co-ordinating body to undertake national planning and co-ordination.

In Japan there is no exclusive public body devoted to the planning and development of ports as such matters are left to local public entities and municipalities. Major seaports in Germany come under the respective City States and the national government does not identify itself as a partner.

There is enough evidence to suggest that India’s maritime States have executed a number of port development projects successfully. Mundra Port now handling the highest volume of cargo — 144.4 million tonnes in 2020-2021 has been developed on a concession granted by Gujarat Maritime Board. Krishnapatnam, Kakinada and Gangavaram ports have been developed on a concession by the Andhra Pradesh Maritime Board.

The State has also an ambitious plan to develop new ports in every one of its coastal district. Though a Maritime Board is yet to be established in Odisha it has developed Dhamra and Gopalpur as commercially significant ports. The Maritime Boards in Tamil Nadu, Kerala and Maharashtra have all drawn up plans for regional development of their ports with private sector participation.

The Union government would do well by taking the Maritime States with it as equal partners in the growth and development of ports in India. Major ports can offer “brownfield sites” while Maritime States can offer “greenfield sites” for development. Investors and port developers would prefer greenfield sites as they will be closer to the corridors of power and will find ease in doing business at the State level.

The Centre should create a conducive environment for maritime States to compete freely with each other and with other major ports and encourage them to develop their ports through an affectionate bond of public-private partnership and participation.

The writer is a former Acting Chairman of J N Port, Mumbai, a former Chairman of Mormugao Port Trust and Adjunct Faculty of Indian Maritime University, Chennai

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