India by virtue of being a peninsular country with a long coastline has the natural advantage of developing ports. There are 13 major ports in the country; 6 on the Eastern coast and 6 on the Western coast. Further there are about 200 non-major ports. The 12 major ports in the country have a combined total capacity of 1,065 million metric tonnes (MMT), while the capacity at non-major ports is roughly 700MMT. Currently 95% of India’s trade by value and 70 % by volume take place through maritime transport.

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Major Ports of India:

Issues and challenges with Indian Ports:

• High turnaround times: Ports in India suffer from high turnaround times for ships. For example, in Singapore, average ship turnaround time is less than a day. However, in India, it is over two days.
• Port congestion: Port congestion due to container volume, shortage of handling equipment and inefficient operations is a major concern. Example: In Nhava Sheva port
• Sub-optimal Transport Modal Mix: Lack of requisite infrastructure for evacuation from major and non-major ports leads to sub-optimal transport modal mix
• Limited Hinterland Linkages: There is inefficiency due to poor hinterland connectivity through rail, road, highways, coastal shipping and inland waterways. This in turn increases the cost of transportation and cargo movement
• Lengthy inspection and scrutiny: Though customs operations in India are rapidly going paperless and converting to digital, inspections and scrutiny continue to be lengthy for cargo and other shipping operations.
• Inadequate infrastructure and Technology Issues:
  • Lack of adequate berthing facility, number of berths, sufficient length for proper berthing of the vessels at the Non-Major Ports is another problem.
  • Most Non-Major Ports do not have proper material handling equipment in place which could facilitate a quick turnaround
  • Most Indian ports lack of equipment for handling large volume
  • Further many ports also lack adequate navigational aids, facilities and IT systems
• Issues with Regulations:
  • The major problem with regulation is that major and non-major ports fall under different jurisdictions. Further, the regulatory framework is rigid.
  • Foreign-flagged vessels are not allowed to ship cargo from one Indian port to another as that remains a protected turf for domestic shippers
  • Land acquisition and environmental clearances are some specific challenges for non-major ports.
• Issues with PPP Model:
  • Most port PPPs impose strict limits on what private operators are allowed to do, usually in terms of the types of cargo they are allowed to handle.
  • Until recently, Other problems were related to tariff regulation and absence of dispute resolution mechanism
• Environmental impact:
  • During the operation of ports, spillage or leakages from the loading and unloading of cargo and pollution from oil spills are common due to poor adherence to environmental laws and standards.
  • The water discharged during the cleaning of a ship and the discharge of ballast water is a threat to marine ecosystems
  • Dredging causes environmental problems (increased sedimentation) affecting local productivity of the local waters and its fisheries.
• Social impacts of Port Development:
  • Most port projects and development results in displacement (such as Gangavaram Port in Andhra and Mundra in Gujarat).
  • Besides displacement, the other important concern expressed by fishing communities is the restriction of access to fishing grounds around a port.
• Manpower and Labour Issues: Lack of adequate training, falling manpower quality, opposition to reform are major issues
• Unhealthy Competition: Analysts have cited the concerns over development of multiple ports in close vicinity handling similar cargo as it might lead to ports competing for the same cargo arrivals.

Measures needed:

• Environmental clearances, Tariff norms, land acquisition etc. need to be standardized and implemented for the port sector so as to boost foreign investments
• It is important to provide rail and road connectivity to major and minor ports in order to ensure seamless multimodal transport and improve efficiency
• Priority should be given on expanding capacity and improving operational efficiency. Emphasis should be placed on installing advanced cargo handling processes, scalability in processes and mechanisation of port operations.
• Technologies like big data and advanced GPS navigation systems should be optimally used for better functioning of ports
• The regulatory regime should be made less complex and less rigid. Further, there should be vertical integration of all stakeholders (for example: environment, rail/road transport etc.) for holistic development of ports in India
• With regards to ports, Vijay Kelkar committee on PPP recommended review of role and need of Tariff Authority for Major Ports (TAMP), review of MCA, quicker clearances, rationalized leases and stamp duties
• Port modernisation and new port development, port connectivity enhancement, port-linked industrialisation and coastal community development under the Sagarmala project has an immense scope for reduction in transportation and logistics costs and boosting export competitiveness.
• Niti Aayog in its Three Year Acton Agenda (2017-2018), recommended the following:
  • Increase competition through easing cabotage
  • Increase the capacity of and eliminate discriminatory provisions for Indian vessels
  • Explore creating deep-water ports or barges for ports with low drafts
  • Facilitate minor/non-major port connectivity to hinterland areas

Conclusion:

Sagarmala project has to be devised to reduce logistics cost and strengthen India’s EXIM industry. Thus, in order to achieve higher economic growth and higher efficiency levels, the trade-GDP ratio needs to increase substantially. Improvement in the efficiency of ports and expansion of their capacity is essential for promoting the growth of trade and export competitiveness.