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Tuesday, 29 Dec 2015
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Sagarmala projects on the fore front



To rope in maritime states under the ambitious Sagarmala project that envisages port-led development to help lift India’s GDP growth by two per cent the Union Shipping ministry on 5 October 2015 lined up Rs 70,000 crore for upgradation of major ports. The proposed integrated port development programme would result in huge saving in logistics cost apart from faster movement of freight.


As per the approved institutional framework of Sagarmala Programme, National Sagarmala Apex Committee (NSAC) and Sagarmala Coordination & Steering Committee (SCSC) have been constituted. NSAC has, so far, given approval for 12 projects for taking up under the Sagarmala Programme. 


The government has taken several other initiatives to develop the port sector like setting up of Indian Port Rail Connectivity Company, exclusively to take care of the last mile connectivity of ports. The Ministry of Shipping has lined up 35 projects for the port sector under Public-Private-Partnership (PPP), entailing investments of around Rs 50,000 crore.


Major Ports coming-up

The Ministry of Finance has recently given ‘in-principle’ approval for Viability Gap Funding (VGF) for development of a port at Vizhinjam on DBFOT basis. Initial work on the first phase of the Vizhinjam port project has begun. Building a breakwater and a 3 km long channel to connect the port with the deep waters are the two works taken up for execution in phase I.


The Centre has decided to form a company, Bhor Sagar Port to implement the proposed Rs 12,000 crore Sagar port project. The proposed port will have the potential to handle 64 million tonne of cargo a year comprising liquid and dry bulk commodities, and containers as well. The work on the project is expected to start soon.


In mid-Nov 2015, the Union Ministry of Shipping drew up a two-stage plan to convert the 11 major ports into corporate entities which currently function as trusts and handle about 57 per cent of the country's overseas cargo.


In Nov 2015, Larsen and Toubro decided to handover the Kattupalli port project to Adani Kattupalli Ports, a subsidiary of Adani Ports and Special Economic Zone. Kattupalli is a deep-water all-weather port with an international container terminal located some 35 km from Chennai and can handle containers with installed capacity of 1.2 million Twenty-foot Equivalent Units (TEUs) per year.


Reducing International Dependence:

In October 2015, the shipping ministry planned to build a mega transhipment hub near Tuticorin in Tamil Nadu at a cost of Rs 5,000 crore to reduce India's dependence on Colombo and Singapore ports for handling cargo traffic. The new container handling facility will not only reduce the logistics cost by around 10 per cent but will also bring down the travel time substantially. The capacity of the terminal is expected to be over 1 million Twenty Equivalent Units (TEUs).


Further, the Cabinet gave its approval to the revised cost estimate of Rs 2,904 crore for the Kaladan Multi Modal Transit Transport project jointly initiated by India and Myanmar to create a multi-modal platform for cargo shipments from the eastern ports to Myanmar and to the North-eastern parts of the country through Myanmar.


In mid-Oct 2015, PM Narendra Modi laid the foundation stone at Jawaharlal Nehru Port Trust (JNPT), for the Rs 7,900 crore fourth terminal project to be built in two phases. The project is being executed by Bharat Mumbai Container Terminal, a subsidiary of Port of Singapore, on a DBFOT basis. The project is expected to double the overall container handling capacity of JNPT to 10 million standard units from the present 4.5 million standard units.


Recently, the Cabinet Committee on Economic Affairs (CCEA) cleared a proposal to mechanise three berths at Paradip Port on PPP basis at an estimated cost of Rs 1,437.76 crores and gave its approval to the project of mechanisation of East Quay (EQ) berths 1, 2 and 3 at Paradip port on the BOT basis.


In Sep 2015, the Andhra Pradesh Government issued a notification for acquisition of 14,500 acre of private land for the development of Machilipatnam minor port as a deep port facility in Krishna district of Andhra Pradesh. The state government also accorded six notifications for acquisition of around 4,100 acre of land in six villages in Srikakulam district for the development of port at Bhavanapadu.


Quote of the week:

"The Sagarmala project is aimed at development of coastal states through modernisation, mechanisation and computerisation and would create huge employment besides boosting the country's GDP"

- Nitin Gadkari, Union Cabinet Minister of Road Transport, Highways and Shipping
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