After spending years trying to corporatise ports, the Shipping Ministry now seems to have given up on the idea. The Modi government is now more interested in modernising ports, which will enhance their throughput and cargo handling capacity.
BusinessLine caught up with Shipping Minister Nitin Gadkari at the recently concluded Maritime India Summit for an understanding of changes which the government has envisaged. Excerpts:
How much investment is the Ministry trying to get for the shipping and port modernisation in the next two years?
The Ministry is attempting to attract ₹8 lakh crore investments for port-led development and industrial clusters. For mechanising and modernising the infrastructure in the ports and providing connectivity through road and rail network another ₹4 lakh crore would be required.
Providing road connectivity would be expedited with the National Highway Authority of India preparing detailed project reports. Chairmen of all the port trusts would be soon be asked to float tenders for these projects. There are no financial constraints for such projects.
What are your plans for greenfield port development in the country?
The Ministry is also developing three new ports, which will require investments of about ₹50,000 crore. Ports will come up at Wadhavan, Dhanu in Maharashtra, Sagar in West Bengal and Colachel in Tamil Nadu. The ground work for these projects has also started.
We are also thinking of developing five more ports in the country. Andhra Pradesh could get two of these ports, and Karnataka and Tamil Nadu one each. A satellite port for Paradip in Odisha would also be developed. Along the Ganga, the Ministry is also developing river ports, which would be used for transporting goods. Project works of ₹3,000 crore have already been commissioned, which will create 20 floating ports and 20 jetty-based ports. The ports will also be connected by three multi-modal hubs.
What is the status of the Talcher-Paradip port railway line, which is expected to substantially reduce the coal and power prices in the country?
Today Mahanadi coalfields at Talcher produce 60 million tonnes but Coal India is planning to increase it to 300 million tonnes. If coal is evacuated faster through coastal shipping then the yearly savings in logistics cost would be about ₹10,000 crore. Therefore, a ₹9,000-crore railway line between Talcher and Paradip is being planned, whose work will soon commence. Power plants located on the West coast will get cheaper coal and per unit electricity cost will reduce by ₹1.
How is your Ministry trying to engage with friendly countries such as Bangladesh and Iran for trade development?
Today bilateral trade between India and Bangladesh is about $6 billion but most of the goods are being transported by road. Therefore, both the governments have decided to hold stakeholder meetings in Kolkata and Dhaka, where sea and river based alternatives would be explored.
In Iran, we want to develop the Chabahar port and a port-based fertiliser plant. Iran has offered gas as a basic feedstock for the plant at $2 per MMBtu. Last week Petroleum Minister Dharmendra Pradhan returned from Tehran after negotiating with the Iranian authorities. Soon the Prime Minister along Shipping and Oil Ministries will take a call on the projects.
If the project goes through then India will have massive savings on fertiliser subsidy and also access to cheaper urea.
What kind of savings are expected from the Sagarmala project?
World over water-based freight is the cheapest. It is five times more expensive to transport the same goods by road. Therefore, we want to develop over 111 rivers in the country for water-based transport. If we integrate coastal cities with inland towns by rivers then there would be a huge saving in freight cost.
Possibilities exist for transporting onions and mangoes from Maharashtra to Sahibganj, Jharkhand by train and then to Myanmar by ships. There would be substantial savings and Indian goods in the international market would become competitive. Today Chinese goods are cheaper because their production units are closer to the river and sea ports.