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Current scenario of Indian Shipping Industry

No Image According to the Ministry of Shipping, around 95 per cent of India's trading by volume and 70 per cent by value is done through maritime transport.
India has 12 major and 200 notified minor and intermediate ports. Cargo traffic, which recorded 1,052 Million Metric Tonnes (MMT) in 2015, is expected to reach 1,758 MMT by 2017. The Indian ports and shipping industry plays a vital role in sustaining growth in the country’s trade and commerce. India is the sixteenth largest maritime country in the world, with a coastline of about 7,517 km. The Indian Government plays an important role in supporting the ports sector. It has allowed Foreign Direct Investment (FDI) of up to 100 per cent under the automatic route for port and harbour construction and maintenance projects. It has also facilitated a 10-year tax holiday to enterprises that develop, maintain and operate ports, inland waterways and inland ports.

The country’s major ports handled a combined traffic volume of 586.29 million tonnes during April 2016-February 2017, up from 550.45 million tonnes during same period last year, while containerised cargo tonnage rose 3.7 per cent to 10.5 MT during August 2016. During April-June 2016, the ports had handled a combined volume of 2.12 million TEUs, which is roughly around 70 per cent of the country’s overall container trade.

The Indian Minister for Shipping, Road Transport and Highways, Mr Nitin Gadkari, announced a massive investment in India’s ports and roads sector, which is likely to help boost the country’s economy. The Indian government plans to develop 10 coastal economic regions as part of plans to revive the country’s Sagarmala (string of ports) project.

The zones would be converted into manufacturing hubs, supported by port modernisation projects, and could span 300–500 km of the coastline. The government is also looking to develop the inland waterway sector as an alternative to road and rail routes to transport goods to the nation’s ports and hopes to attract private investment in the sector.

An expert panel of the Union environment ministry has recommended approvals for projects worth Rs 20,500 crore (US$ 3.07 billion) in the aviation and port sectors.
Minister of Road Transport and Highways, and Shipping, Mr Nitin Gadkari is hopeful of bringing a 'blue revolution' in five years which will include developing eight major ports, making 27 industrial clusters, developing rail and road connectivity with ports and will entail investment of around Rs 400,000 crore (US$ 60 billion).Government of India plans to invest Rs 70,000 crore (US$ 10.5 billion) in 12 major ports in the next five years under 'Sagarmala' initiative.

Government of India is planning to set up low-cost non-major ports along coastline under the Sagarmala project and has asked all the 12 major ports to accord priority berthing to such vessels and to encourage quicker movement of cargo.

The Union Cabinet has approved the proposal of Ministry of Shipping to replace the 'Major Port Trusts Act, 1963' by the 'Major Port Authorities Bill, 2016', which will empower major ports to perform with greater efficiency by having full autonomy in decision making and by modernising the institutional structure of major ports.

The Ministry of Shipping plans to undertake development of 37 national waterways (NWs), out of the 111 NWs declared under the National Waterways Act 2016, in the next three years, which would have positive impact on reduction of overall logistics cost.
The Union Cabinet has approved a new productivity-linked reward (PLR) scheme for 37,870 Port and Dock workers in all the Major Port Trusts for the years 2015-16 to 2017-18 at an annual cost of Rs 49.58 crore (US$ 7.4 million).

Mr Nitin Gadkari, Minister for Road Transport and Highways and Shipping, has stated that India would like to collaborate with Germany for projects worth Rs 1 trillion (US$ 15 billion), aimed at enhancing port rail connectivity and identifying environment-friendly technology for scrapping of old vehicles.

The Ministry of Road Transport and Highways and National Highways Authority of India (NHAI) plan to take up 82 highway development projects under the Bharatmala project, which would help in improving connectivity to both major as well as minor ports in the country.

The Ministry of Shipping plans to install 160.64 megawatts (MW) of solar and wind based power systems at all the major ports across the country by 2017, thereby promoting the use of renewable energy sources and giving a fillip to government's Green Port Initiative.

The Union Cabinet is planning to propose amendments to the Multi Modal Transportation of Goods Act, 1993, with a view to increase transparency in the shipping and logistics sectors and to discourage container freight stations from overcharging both importers and exporters.
Increasing investments and cargo traffic point towards a healthy outlook for the Indian ports sector. Providers of services such as operation and maintenance (O&M), pilotage and harboring and marine assets such as barges and dredgers are benefiting from these investments.

02-05-2017

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