PORTS AND SHIPPING

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SUMMARY
  • India has 12 major ports and around 200 minor ports.1
  • The total cargo handling capacity of Indian ports is 2400+ Million Metric Tonnes Per Annum (MMTPA).2
  • Ports in India handle approximately 95% (by volume) and 68% (by value) of India’s external trade.3
REASONS TO INVEST
  • The Ministry of Shipping strives to increase the overall port capacity to 3300+ million metric tonnes per annum (MMTPA) to cater to projected traffic of 2500 MMTPA by 2025.4
  • India has jumped to 68 rank 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 parameters like to elimination of manual forms, Direct Port Delivery, Direct Port Entry, Installation of Container Scanners, E-delivery orders, introduction of RFID, etc.5
  • 58 projects involving a cost of USD 6.6 Bn have been identified as part of National Infrastructure Pipeline (NIP) for infrastructure augmentation and development at major ports up to 2025.6
  • 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 USD 8.3 Bn are under various stages of development.8
  • Under Project Unnati 107 initiatives to improve the efficiency and productivity of the major ports were identified of which 95 have been completed. These initiatives will unlock around 100 MTPA capacity.9
  • India’s increasing integration into Global Value Chains requires a well-established port infrastructure.

 

Explore more about infrastructure availability in Ports and Shipping sector >

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 stands at 1524.92 MMTPA in December 2019.11
  • During April 2019 to February 2020, the cargo traffic handled at major ports was 704.63 MMT.12
  • The traffic handled at non-major ports was 447.21 MMTPA for April-December 2019, showing a growth of nearly 5% over the previous year.13
  • Cargo handled at ports during the period 2018-19: Petroleum, Oil and Lubricants (33%), followed by Containerized cargo (20.8%), Coal (18.26%), Other Misc. Cargo (20.65%), Iron Ore (4.9%), and Fertilizer and Fertilizer materials (2.16%).14
FDI POLICY
  • The Government of India allows 100% FDI under the automatic route for port development projects.15

 

Read more about Foreign Direct Investment Policy in India >

SECTOR POLICY

Sagarmala Programme16

  • 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 cost of transporting domestic cargo through optimising modal mix
  • Under Sagarmala Programme, 500 projects worth USD 47.3 Bn of investments have been identified for implementation up to 2035. 

Coastal Berth Scheme17

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

Major Port Authorities Bill, 202018

  • 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 in operations of various ports.

Recycling of Ships Act, 201919

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

 

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FINANCIAL SUPPORT

Key Provisions in Union Budget 2020-2120

  • Total allocation made to Ministry of Shipping in 2020-21 stands at USD 240 Mn. 
  • Total capital expenditure allocation in the union budget 2020-21 stands at USD 11.3 Mn.
  • Total budget allocation towards the development of ports stands at around USD 19 Mn.
  • An allocation of USD 39.6 Mn has been made towards the Sagarmala Projects.
  • The total allocation for inland water transport stands at USD 90.4 Mn.

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

INVESTMENT 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)
KEY ACHIEVEMENTS
  • Under the Sagarmala Programme, 143 projects were completed, while 190 projects worth USD 28.2 Bn 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
SOURCES
  1. "Major Ports & Non-Major Ports", Ports Wing, Ministry of Shipping, http://shipmin.gov.in/division/ports-wing
  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. “Annual Report 2019-20", Ministry of Shipping, http://shipmin.gov.in/sites/default/files/Shipping%20Annual%20Report%20English_compressed.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
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