In an exclusive interview, Kailash Agarwal, Joint Secretary of the Ministry of Maritime Transport, revealed that a roadmap had been developed to increase Indian port capacity to 3500 + MMTPA to meet the expected 2500 MMTPA traffic by 2025.

Kailash Agarwal, Joint Secretary of the Indian Maritime Department

Q: What are your views on the current port industry and its growth potential?

A: The port will continue to be the gateway of India's EXIM trade. Import and export trade is an important part of India's economy, so modern ports must conform to international standards. Because of India's optimistic economic growth prospects, trade is expected to continue to grow and provide stable growth for ports.

In addition, the Ministry of Maritime Transport is providing policy and procedural impetus for coastal shipping. Coastal freight volume in fiscal year 2019 is about 120 million tons, and it is expected to increase to 220 million tons by fiscal year 2025. This will provide additional impetus for India's port sector. Major ports are also developing cruise terminals to attract modern cruise ships, promote domestic and international coastal tourism and increase passenger flows.

Innovation and adoption of technology, the development of Indian transshipment centres and the growth of cruise tourism are key drivers of the sector's growth. Finally, port-led industrialization is expected to provide long-term freight growth for ports under the port-led mode successfully adopted by various maritime countries.

Q: Please tell us about the progress made so far by the government in considering the four important elements of Sagarmala. What is the total cost and completion schedule of these projects?

A: So far, about 600 projects have been identified under the Samarla plan, which will require more than 8.7 trillion rupees in investment by 2035. The Sagarmala project aims to double the proportion of domestic waterways (inland and coastal) in the model portfolio, save logistics costs by 350-400 billion rupees per year, boost commodity exports by $110 billion, and create 1 million new jobs, including 40 million direct jobs by 2025.

Port Modernization and New Port Development: A total of 262 projects (costing 1.45 trillion rupees) have been identified to improve port operation capacity and efficiency. Of these 262 projects, 62 (valued at 167.8 billion rupees) have been completed and 69 (valued at 397.26 billion rupees) are under implementation.

A roadmap has been established to increase Indian port capacity to 3,500+MMTPA to meet the expected 2500 MMTPA traffic by 2025. Of the 262 port modernization projects, 109 port capacity expansion projects have been identified, with a value of Rs 678.04 billion. Overall port planning for 12 major ports will be implemented in the next 20 years, and 785 MTPA is expected to be added to major ports. Of the 109 port master planning projects, 24 projects (valued at 153.81 billion rupees) have been completed and 36 projects (valued at 14.524 billion rupees) are under implementation. Twenty-four completed projects have added 148 MTPAs to major ports.

In addition, under the Unnati project, a global benchmark was adopted to improve the efficiency and productivity of 12 major ports. About 116 initiatives have been identified at 12 major ports to unlock more than 100 MTPAs by improving efficiency alone. Among them, 91 initiatives have been implemented to unlock about 80 MTPA capabilities.

Port connectivity enhancement: 212 projects (worth 2.49 trillion rupees) have been identified to improve port connectivity with India. Of these 212 projects, 29 (cost 52.69 billion rupees) have been completed and 63 (value 61.203 billion rupees) are under implementation. In 2018-19, 15 port connectivity projects (valued at Rs. 3.07 billion) added about 32 kilometres of roads and 80 kilometres of railways.

Between 2019 and 2020, 20 port connectivity projects (worth 188.25 billion rupees) are likely to be completed, with an increase of about 1358 kilometres of roads and 514 kilometres of Railways expected. By 2020, about 1900 kilometres of roads and 1900 kilometres of railways are expected to be put into operation to improve the last mile of connection with the port. The plan aims to increase road and rail infrastructure by 12,000 kilometres by 2025.

Port-related industrialization: 57 projects (worth 4.74 billion rupees) have been identified for port-led industrialization. Of these, two projects (worth 5.12 billion rupees) have been completed and 17 projects (costing 1.47 billion rupees) are under implementation.

Sagarmala's vision is to reduce logistics costs and time in order to move EXIM and domestic goods and develop industrial capacity near coastal ports. In this regard, 35 potential port-related industrial clusters in three sectors, namely energy, materials and discrete manufacturing, have been identified. They include 12 bulk cargo clusters for basic input industries such as electricity, oil refining and petrochemical, steel and cement, and 23 discrete manufacturing clusters involving labor-intensive industries such as electronics, clothing, leather products, furniture and food processing. Overall plans for the proposed maritime clusters in Gujarat and Tamil Nadu have been prepared.

In addition, the JNPT Special Economic Zone (at a cost of 12624 kroner), Paradip Intelligent Industrial Port City (at a cost of 3350 kroner) and Kandla (at a cost of 11,147 kroner) are being implemented. VoCPT and KPL coastal employment units are under development.

Coastal Community Development: A total of 56 projects (worth Rs 65.87 billion) have been identified for coastal community development. Of these 56 projects, 16 (worth 12.1 billion rupees) have been completed and 18 (worth 10.15 billion rupees) are under implementation. In 2018-19, 14 projects (amounting to Rs. 10.94 billion) were completed.

Q: How do these four pillars of Sagarmala provide opportunities for private players?

A: Inviting private participation in the construction and development of the project. As mentioned earlier, given the significant capital expenditures of the project, various activities, from DPR preparation and civil construction to BOT operations, provide ample opportunities for the private sector.

The main ports are now largely based on the principle of the landlord model, where the basic fixed infrastructure is provided by the port, the reaming infrastructure and operations and maintenance are the responsibility of the private operator.

Coastal employment zones, coastal employment units, smart industrial port cities and other port-led industrialization efforts envisage the establishment of industrial zones to provide plug-and-play infrastructure for private companies to establish new industries.

According to the Coastal Community Development Plan, training centers operated by private participants are being developed. The Extended Skills Development Center provides a good opportunity for private participants. Editor/Zhao Jing