Ports and Shipping

Summary
  • India comprises a significant size maritime sector with 12 Major and 200+ Non-Major Ports situated along its 7500 km long coastline and a vast network of navigable waterways.1
  • The total cargo handling capacity of Indian ports is about 2400 million tonnes per annum (MTPA).2
  • Ports in India handle approximately 95% (by volume) and 68% (by value) of India’s external trade.3
  • India is one of the world's top 5 ship recycling countries and holds a 30% share in the global ship recycling market.
  • India ranks 18th in the World’s Shipping Tonnage.
  • India has 12 Major ports and about 200 non major ports.
  • Under Maritime India Summit 2021, 486 MoUs were signed for Maritime India Summit 2021 by 22 Maritime Ports/Agencies/Authorities for USD 47.02 bn across different subsectors.38
  • India has become the fourth country in the world to have its independent Regional Navigation Satellite System (IRNSS).33 
Reasons to Invest
  • The Ministry of Shipping strives to increase the overall port capacity to 3300+ million tonnes per annum (MTPA) to cater to projected traffic of 2500 MTPA by 2025.4
  • India has jumped to 68 ranks in 2019 in the Trading Across Border (TAB) parameter of Ease of Doing business (EoDB) from 80 in 2018 in World Bank's Ease of Doing Business Ranking 2020.' This is due to parameters such as elimination of manual forms, direct port delivery, direct port entry, installation of container scanners, e-delivery orders and introduction of RFID.5
  • 58 projects involving a cost of USD 6.6 Bn have been identified as part of the National Infrastructure Pipeline (NIP) for infrastructure augmentation and development at major ports up to 2025.6
  • Ministry has identified and added 25 new ports sector projects worth INR 7,738 cr as part of its continued efforts of effective implementation of NIP.
  • The Sagarmala Programme aims to lead port industrialization by the development of Coastal Economic Zones (CEZs), Coastal Economic Units (CEUs), Port-Linked Industrial & Maritime Clusters and Smart Industrial Port Cities. 7
  • Under Sagarmala Programme, port projects worth INR 3.55 lakh cr are under various stages of development. 8
  • Under Project Unnati 116 new initiatives to improve the efficiency and productivity of the major ports were identified of which 95 have been completed. 9
  • The Budget Estimate of Gross Budgetary Support (GBS) for FY 2019-2020 was INR 1902.56 crore for the Ministry.26
  • India is strategically located on the world’s shipping routes with a long coastline of about 7,517 km and over 200 major and minor ports, he said “these ports play an important role in India’s economy.”

 

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Recent Announcements

14th September 2021: Shri Sonowal underlines importance of cross-border connectivity among developing nations of South-East Asia; Addresses ASEAN summit on Future of India-ASEAN Connectivity Partnerships

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13th September 2021: Paradeep Port Trust aims to boost EXIM trade with the installation of a New Container Scanner to directly move out their containers with upgrade security and zero hassle.

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08th September 2021: JNPT records 28.45% growth in container traffic; handled 453,105 TEUs in August 2021.

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06th September 2021: Union Minister of State for Ports, Shipping and WaterwaysShri Shantanu Thakur inaugurated/ dedicated three projects to the nation at Netaji Subhas Dock of Syama Prasad Mookerjee Port(SMP), Kolkata

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03rd September 2021: Notification of Cochin Port Trust (Licensing of Jetties, Piers and Regulations, 2021 in the Gazette of lndia.

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Statistics
  • India is the 16th largest maritime country in the world, with a coastline measuring more than 7500 km.10
  • The cargo handling capacity of Major Ports stood at 1524.91 million tonnes in the year 2019-20 (till December 2019).11
  • During April 2019 to March 2020, the cargo traffic handled at major ports was 704.63 million tonnes.12
  • The overall installed capacity of the major ports in India has increased over 76% to reach 1,534.91 MTPA in Mar 2020, vis-a-vis 871.52 MTPA in March 2014. Moreover, the total traffic handled by these major ports has reached to 704.92 MT during 2019-20.35
  • The capacity of major ports which was 871.52 MTPA at the end of March 2014 has increased to 1534.91 MTPA by the end of March 2020.35
FDI Policy
  • The Government of India allows 100% FDI under the automatic route for port development projects. 15
  • The cumulative FDI equity inflow in the Port industry is USD 1,637.30 mn during the period April 2000 to June 2021.14

 

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Sector Policy

Sagarmala Programme 16

  • Sagarmala Programme aims to change India’s logistics sector performance, by unlocking the full potential of India’s coastline and waterways. Various projects have been initiated under the Sagarmala project:
    • Port Modernization
    • Connectivity enhancement
    • Port led Industrialization
    • Coastal Community Development
  • The Sagarmala Project has the following aims:
    • Reduce logistic cost for export import (EXIM) and domestic trade with minimal infrastructure investment
    • Optimise cost of EXIM container movement
    • Lower the logistics cost of bulk commodities by locating future industrial capacities near the cost
    • Improve export competitiveness by developing port proximate discrete manufacturing clusters
    • Reduce the cost of transporting domestic cargo by optimising the modal mix
  • Sagarmala Program has identified 500+ Development Projects, more than INR 3.59 lakh cr of Investment on Cards.37
  • Ministry has sanctioned financial assistance of INR 27 cr and released INR 6.14 cr towards balance payment of the second instalment to Chennai Port Trust for Development of Paved Storage for handling export cargo.30
  • Sagarmala project, more than 504 projects have been identified to unlock the opportunities for port-led development and these initiatives are expected to mobilize more than 3.57 lakh crore of infrastructure investment.
  • In the last 15 months (July 2019 – October 2020), 20 Sagarmala projects worth INR 4,543 cr have been completed which comprise 9 projects of Port Modernization worth INR 1,405 cr, 7 Port Connectivity projects worth INR 2,799 cr and 4 Coastal Community Development projects worth INR 339 cr.34

Coastal Berth Scheme 17

  • The scheme aims to provide financial support to ports/state governments for the creation of infrastructure for the movement of cargo/passenger by sea or National Waterways. This scheme was integrated under the Sagarmala Programme

Major Port Authorities Bill, 2020 18

  • The bill was introduced in Lok Sabha in March 2020 with an aim to replace the Major Port Trusts Act, 1963.
  • The bill aims to decentralize decision making and infuse professionalism in the governance of ports. It will also help bring transparency to the operations of various ports.

Recycling of Ships Act, 2019 19

  • The Recycling of Ships Act, 2019 provides for the regulation of the recycling of ships by setting certain international standards and laying down the statutory mechanism for enforcement of such standards.

SAROD-Ports:29

  • SAROD-Ports was launched on 10 September 2020 by Shri Mansukh Mandaviya, MOS(IC) Shipping. These ports are for affordable and timely resolution of disputes in a fair manner and enrichment of Dispute Resolution Mechanism with the panel of technical experts as arbitrators.
  • This institution will promote ease of doing business in the maritime sector because of the fast, timely, cost-effective and robust dispute resolution mechanism.

Merchant Shipping Bill

  • The envisioned advantages of the Merchant Shipping Bill, 2020 are promoting ease of doing business, embracing digital technology and increasing tonnage and Vessel as a Tradable Asset.
  • Ministry of Ports, Shipping and Waterways has circulated a draft of the Indian Ports Bill 2020 for public consultation which will repeal and replace the Indian Ports Act, 1908 (Act No. 15 of 1908).32

Chabahar Port

  • Chabahar Port project will be developed as a transit hub for cross connectivity between India and Eurasia and this port will handle 123 vessels and a total of 13,752 TEUs and 18 lakh tons of bulk / general cargo.

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Financial Support

Key Provisions in Union Budget 2020-21 20

  • Total allocation made to Ministry of Shipping in 2020-21 stands at INR 1800 cr. 
  • Total capital expenditure allocation in 2020-21 stands at INR 85 cr.
  • Total budget allocation towards the development of ports stands at INR 143.5 cr.
  • An allocation of INR 297 cr has been made towards the Sagarmala Projects.
  • The total allocation for inland water transport stands at INR 678.30 cr.
  • The Major Port Authorities Bill, 2021 aims to provide greater autonomy, flexibility to the Major Ports and to professionalise their governance by repealing the Major Port Trusts Act, 1963. 

For further details about the budget allocation for the Ministry of Shipping, please log onto Budget Allocation for Ministry of Shipping.

Imvestment Opportunities
  • Shipbuilding
  • Ship repair
  • Ship recycling
  • Development of inland waterways and inland water transport
  • Port and harbour construction projects
  • Port and harbour maintenance projects

 

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Foreign Investors
  • AP Moller Maersk (Denmark)
  • PSA Singapore (Singapore)
  • Dubai Ports World (UAE)
  • Hyundai Engineering and Construction Company Limited (South Korea)
  • Jan De Nul Group (Luxembourg)
  • Boskalis (Netherlands)
  • SAAB (Sweden)
  • Van Oord (Netherlands)
  • Wartsila (Finland)
  • P&O Ports (UAE)
Agencies
Key Achievements
  • Under the Sagarmala Programme, 143 projects were completed, while 190 projects worth INR 2.12 lakh cr have been awarded and are under implementation.21
  • The average turnaround time was 59.51 hours during 2018-19.22
  • The average output per ship berth day was 16,541 in 2018-19.23
  • The development of the 13th major port has been approved at Vadhavan in Maharashtra.24
  • The MoU was signed between Cochin Port and MPEDA on 28 September 2020 for taking up the Modernisation of Cochin Fisheries harbour project at a cost of INR 140 cr.27
  • The Ministry of Shipping in order to make the process transparent and  participatory issued the draft of Coastal Shipping Bill, 2020. This wil integral part of the transport chain and recognizes the policy priorities of the sector to meet the demands of the Indian shipping industry. 28
  • MoU between IWAI and the Government of Assam for “Operation and Management of 4 Ro-Pax Vessels on 22.10.2020. All four vessels have been handed over to the Government of Assam in terms of MoU approved by the Ministry of Shipping.30
  • Syama Prasad Mookerjee Port, Kolkata has handled 9.090 million tonnes (MT) of cargo during April-May 2021, vis-à-vis 7.438 MT during April-May2020, registering a growth of 22.21%.
  • The Cabinet has approved the project Deepening and Optimizing of Inner Harbour Facilities of Western Dock at Paradip Port under PPP mode with a total estimated cost of INR 3,004.63 cr.36
  • Department of Commerce issued an enlistment for the addition of Hazira Port as the import of scrap port and no exception would be allowed even in case of EOUs, SEZs.31 
  • Jawaharlal Nehru Port Trust - JNPT, one of the premier container handling ports, recorded 433,533TEUs (Twenty-Feet Equivalent Units) in July 2021, a growth of 21.15%.
Sources
  1. "Major Ports & Non-Major Ports", Ports Wing, Ministry of Shipping, https://static.investindia.gov.in/s3fs-public/2021-03/MIV%202030%20Report.pdf
  2. “Annual Report 2019-20", Ministry of Shipping, http://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  3. “Annual Report 2019-20”, Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  4. “Annual Report 2019-20”, Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  5. "Economy Profile - India, Doing Business 2020 Report", https://www.doingbusiness.org/content/dam/doingBusiness/country/i/india/IND.pdf
  6. “Infrastructure at ports”, PIB, https://pib.gov.in/PressReleasePage.aspx?PRID=1607120
  7. "Port Led Industrialization"Sagarmala Programme, http://sagarmala.gov.in/project/port-led-industrialization
  8. “Annual Report 2019-20", Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  9. “Annual Report 2019-20", Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  10. “Annual Report 2019-20", Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  11. “Annual Report 2019-20", Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  12. “Major achievements for the month of March, 2020”, Ministry of Shipping, http://shipmin.gov.in/sites/default/files/march2020.pdf
  13. “Annual Report 2019-20", Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  14. Factsheet on FDI - April 2000 to June 2021, Department for Promotion of Industry and Internal Trade,   https://dpiit.gov.in/sites/default/files/FDI_Factsheet_June2021.pdf
  15. "FDI in Ports Sector, Ministry of Shipping", PIB, http://pibarchive.nic.in/newsite/PrintRelease.aspx?relid=103354
  16. “Annual Report 2019-20", Ministry of Shipping, http://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  17. "Coastal Berth Scheme, Ministry of Shipping", PIB, https://pib.gov.in/Pressreleaseshare.aspx?PRID=1523346
  18. "Major Port Authorities Bill 2020 Introduced in The Loksabha", Ministry of Shipping, PIB, https://pib.gov.in/PressReleseDetail.aspx?PRID=1606130#:~:text=Major%20Port%20Authorities%20Bill%202020%20Introduced%20in%20The%20Loksabha&text=Major%20Port%20Authorities%20Bill%202020%20was%20introduced%20in%20the%20Loksabha,%2FC)%20Shri%20Mansukh%20MANDAVIYA.
  19. "The Recycling of Ships Bill, 2019 becomes an Act after receiving assent of President of India", Ministry of Shipping, PIB, https://pib.gov.in/Pressreleaseshare.aspx?PRID=1596730
  20. “Expenditure Budget, Ministry of Shipping”, Union Budget of India 2020-21, https://www.indiabudget.gov.in/doc/eb/sbe90.pdf
  21. “Annual Report 2019-20", Ministry of Shipping, http://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  22. “Annual Report 2019-20", Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  23. “Annual Report 2019-20", Ministry of Shipping, http://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  24. “The Sagarmala Post, March 2020”, Sagaramala Programme, http://sagarmala.gov.in/sites/default/files/The%20Sagarmala%20Post%20%28March%29%202020%20Edition.pdf
  25. “Annual Report 2019-20”, Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  26. “Annual Report 2019-20", Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.pdf
  27. "Monthly Achievement Report", http://shipmin.gov.in/sites/default/files/Major%20achievements%20for%20the%20month%20of%20September%2C%202020.pdf 
  28. PIB https://pib.gov.in/PressReleasePage.aspx?PRID=1668432
  29. "Monthly Achievement Report", Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/Major%20achievements%20for%20the%20month%20of%20September%2C%202020.pdf
  30. "Monthly Achievement Report", Ministry of Shippinghttp://shipmin.gov.in/sites/default/files/MAJOR%20ACHIEVEMENTS%20FOR%20THE%20MONTH%20OF%20OCTOBER%2C%202020.pdf
  31. Ministry of Shippinghttps://content.dgft.gov.in/Website/dgftprod/663462cc-ef6d-4dc0-9e32-8a1a35fbd0da/PN%2031%20English.pdf
  32. PIB Release, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1679974
  33. "Monthly Achievement Report", Ministry of Ports, Shipping and Waterwayshttp://shipmin.gov.in/sites/default/files/MAJOR%20ACHIEVEMENTS%20FOR%20THE%20MONTH%20OF%20NOVEMBER2020.pdf
  34. PIB Release, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1684394
  35. Year-End Review -2020: Ministry of Ports, Shipping and Waterways, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1684394
  36.  Ministry of Ports, Shipping and Waterwayshttp://shipmin.gov.in/sites/default/files/majordec.pdf
  37. PIB Release, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1693183
  38.  Ministry of Ports, Shipping and Waterways, http://shipmin.gov.in/sites/default/files/Majormarch.pdf

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