Business Standard: June 01, 2017
Maritime projects worth Rs 8 lakh crore that failed to attract private investment will be executed by the shipping ministry through government funding.
The ministry has identified 199 such contracts to be implemented over the next two years.
These projects, of which Rs 1.37 lakh crore are under various stages of implementation and development, will be executed in phases.
The residual projects drew low interest from the private sector on account of financial viability. The proposal to undertake them through government funding was first mooted in 2014 when the government announced its infrastructure development plan.
“As many as 415 projects were identified to be executed by the private sector in a span of 20 years (2015-2035). Of these, 199 projects are targeted to be executed by 2019,” an official told Business Standard.
The 199 projects include port modernisation, port-led industrialisation, port connectivity and coastal community projects. Of these, 55 are worth above Rs 1,000 crore each.
The residual project category was carved out as some port connectivity projects struggled to find takers under the public-private partnership mode and some states were not willing to take them up.
These projects will be fully financed by the shipping ministry and Sagarmala Development Company. The National Highways Authority of India, Indian Railways, port trusts, Container Corporation of India and the agriculture ministry are some of the implementing agencies for these projects.
The main objective of SDC is to identify port-led development projects under the Sagarmala programme and provide equity support for the project special purpose vehicles (SPVs) set up by the ports, states and central ministries. It is also a funding window to implement projects that cannot be financed by any other means.
The government’s ambitious port-led development plan through coastal economic zones (CEZs) is under way in nine maritime states.
The government is essentially phasing these CEZs depending on where the ecosystem is right, where there’s availability of large contiguous land parcels, access to urbanisation and supporting infrastructure, and where prime manufacturing locations are in place. The learning from these will be replicated across other CEZs.
Ports handle 90 per cent of the country’s EXIM cargo by volume and 70 per cent through value. Gujarat alone caters to 25-30 per cent of the cargo traffic. The government has also planned to integrate ports with industrial clusters and their hinterland.
Maritime development is part of the larger port-led development plan of the government through CEZs across all the nine maritime states by advancing efforts to develop one new port each on the east and west coast.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.