According to the Ministry of Shipping, around 95% of India's trading by volume and 70% by value is done through maritime transport. In November 2020, the Prime Minister, Mr. Narendra Modi renamed the Ministry of Shipping as the Ministry of Ports, Shipping and Waterways.
India has 12 major and 205 notified minor and intermediate ports. Under the National Perspective Plan for Sagarmala, six new mega ports will be developed in the country. The Indian ports and shipping industry play a vital role in sustaining growth in the country’s trade and commerce. India is the sixteenth-largest maritime country in the world with a coastline of about 7,517 kms. The Indian Government plays an important role in supporting the ports sector. It has allowed Foreign Direct Investment (FDI) of up to 100% under the automatic route for port and harbour construction and maintenance projects. It has also facilitated a 10-year tax holiday to enterprises that develop, maintain and operate ports, inland waterways and inland ports.
India’s key ports had a capacity of 1,534.91 million tonnes per annum (MTPA) in FY20. In FY20, all key ports in India handled 704.93 million tonnes (MT) of cargo traffic.
Merchandise exports reached US$ 255.92 billion in FY21 (until February 2021).
The Government has taken several measures to improve operational efficiency through mechanisation, deepening the draft and speedy evacuations.
Some of the major initiatives taken by the government to promote the ports sector in India are as follows:
Increasing investment and cargo traffic point towards a healthy outlook for the Indian ports sector. Providers of services such as operation and maintenance (O&M), pilotage and harbouring and marine assets such as barges and dredgers are benefiting from these investments.
The capacity addition at ports is expected to grow at a CAGR of 5-6% till 2022, thereby adding 275-325 MT of capacity.
Domestic waterways have found to be a cost-effective and environmentally sustainable mode of freight transportation. The government aims to operationalise 23 waterways by 2030.
As part of the Sagarmala project, more than 574 projects worth Rs. 6 lakh crore (US$ 82 billion) have been planned for implementation between 2015 and 2035.
In Maritime India Summit 2021, the Ministry of Ports, Shipping and Waterways identified a total of 400 projects worth Rs. 2.25 lakh crore (US$ 31 billion) investment potential.
India’s cargo traffic handled by ports is expected to reach 1,695 million metric tonnes by 2021-22 according to a report by the National Transport Development Policy Committee.
Note: Conversion rate used in February 2021, Rs. 1 = US$ 0.014
References: Indian Ports Associations, Consolidated FDI Policy, Press Information Bureau (PIB), Media Reports.
TEUs- Twenty Foot Equivalent Units, MMT-million metric tonnes
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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