India\u2019s improving infrastructure is being matched by ongoing legal and policy reforms which are moving the South Asian country towards transhipment hub status – a significant watershed.<\/p>\n
Topping the legislative agenda is the Major Ports Authorities Bill, which seeks to provide greater autonomy and flexibility to major ports. The Bill repeals the Major Port Trusts Act.<\/p>\n
The move is based on Government thinking that the central regulation of tariff in the major ports has hindered growth and development. It put forward the Major Port Authorities Bill which aims to give greater autonomy and flexibility to India\u2019s larger ports.<\/p>\n
The Bill will apply to the major ports of Chennai, Cochin, Jawaharlal Nehru Port, Kandla, Kolkata, Mumbai, New Mangalore, Mormugao, Paradip, V.O. Chidambaranar, and Vishakhapatnam,\u201d said PRS India. \u201cThe central government may notify more major ports,\u201d it added.<\/p>\n
The Bill provides for the creation of a Board of Major Port Authority for each facility. The Boards can use property, assets and funds as they see fit to develop the port and can fix the rates charged for services as well as determine access and usage \u2013 effectively freeing the ports from central control.<\/p>\n
They can also raise some funds without the permission of the Central Government \u2013in itself a significant change.<\/p>\n
The Board can also make rules on declaring availability of port assets for port-related activities and services; developing and providing infrastructure facilities such as setting up new ports and jetties; and providing exemption or remission from payment of any charges on any goods or vessels.<\/p>\n
Currently the bill is \u201cpending\u201d in the Indian Parliament according to PRSIndia.org, having been introduced into the Lok Sabha, one of the two houses in the Indian Parliament. While no one is foreseeing an attempt to filibuster, there is a democratic process to go through which will mean changes could be slow in coming and then in being implemented.<\/p>\n<\/p>\n
Faith in change<\/em><\/p>\n \u201cI have no doubt it will be passed,\u201d Julian Bevis, senior director group relations for Maersk in South Asia tells Port Strategy<\/em>. However its scope will be limited because it is prospective, meaning it does not apply to existing terminals and ports and will only apply to those built from now on.<\/p>\n \u201cTAMP will go away for the new terminals\u201d said Mr Bevis, acknowledging that some major ports will \u201cremain under the jurisdiction of TAMP for the foreseeable future\u201d. One way around this would be a re-tender \u2013 another possibly lengthy process. However, the point long term is clear: TAMP\u2019s days are numbered.<\/p>\n Where there has been decisive movement forward is in cabotage which is very much a rolling process and one with some serious momentum in it.<\/p>\n Most recently it was fertilisers that were given a waiver. More significantly in May the Indian government relaxed the rules about both the coastal movement of export\/import transhipment containers and empty containers as well as agriculture, horticulture, fisheries and animal husbandry products.<\/p>\n \u201cThis relaxation allows Indian entities to charter foreign flagships and foreign-flagged ships owned by shipping lines to ply the coastal routes without the hassle of getting a license with conditionalities,\u201d said the Ministry of Shipping of both trades.<\/p>\n What the Ministry went on to say about containers makes it plain these strictly commercial decisions have a clear goal in mind.<\/p>\n<\/p>\n Transhipment aims<\/em><\/p>\n The change is to promote the shift of transhipment of cargo from foreign to Indian ports, increase competition, reduce freight rates, increase logistics efficiency, promote coastal transportation of containers, establish an ecosystem in India for consolidation and retain foreign exchange, the ministry said.<\/p>\n Currently almost a third of lndia\u2019s container cargo is transhipped at foreign ports, up from 26% in 2007-08 according to the Indian Ports Association \u2013 taking that business back puts India on the way to becoming its own transhipment hub.<\/p>\n \u201cWe and others are moving empty boxes and some loaded boxes. It\u2019s a very constructive step,\u201d said Maersk\u2019s Mr Bevis. His basic view is that transhipment hubs will happen, but not overnight. Good as that is for India\u2019s port industry it also raises the possibility of regional competition with Sri Lanka.<\/p>\n Against these positive steps there are some drags and disruptors to be considered. Mr Bevis pointed out that labour markets reforms are not particularly deep. One flagged by Jason Chiang, director at Ocean Shipping Consultants, is that India\u2019s ports are often provincial in their outlook. \u201cThey all want to be the terminal to be transhipped from,\u201d he told Port Strategy<\/em>.<\/p>\n<\/p>\n Land connections<\/em><\/p>\n The other problem is not so much the ports themselves but the still vexed issue of on-land connections. \u201cThe bottleneck now is not within the port \u2013 now its outside the gate,\u201d said Chiang.<\/p>\n Here though different sorts of help are coming into play. The government is big on trade facilitation with the ministry issuing an Order \u201cto ensure the smooth flow of sea-trade among the maritime community stakeholders.\u201d<\/p>\n This makes the \u201cissuance of e-invoice, e-payment and e-do mandatory irrespective of the portal providing these services,\u201d the Order said. There is a caveat or two but as the industry notes the intention is there.<\/p>\n \u201cShipping lines may continue to use their present systems\/portals, and third party solutions for carrying out e-invoice and e-payment until their facilities are fully ready in PCS,\u201d the Order added. \u201cHowever, e-Do is to be submitted through PCS mandatorily.\u201d<\/p>\n And it is pushing to improve connectivity by \u201cimplementing rail projects worth Rupees18,795 crores (ten million) to provide rail connectivity to various ports through the Indian Port Rail Corporation. This will bring down the logistics costs significantly and will give a boost to port-led development of our coastal areas,\u201d the shipping ministry said in a recent tweet.<\/p>\n More specifically there is a West Coast Freight Corridor in the offing which will \u201cmake a difference,\u201d according to Bevis although he acknowledges they are needed elsewhere too. It\u2019s probably a fitting conclusion: interesting things, big and significant things are happening but there is still more to do.<\/p>\n Add to all this what India is doing outside its borders in Iran. \u201cIndia is all set to begin interim operations at strategically-located Chabahar Port soon. Chabahar Port on the south-eastern coast in Iran is of great strategic importance to India, will provide an alternative reliable access route into Afghanistan and resource rich Central Asia,\u201d the Indian shipping minister tweeted.<\/p>\n It also allows India to circumvent its neighbour (and rival) Pakistan and is, as one source pointed out, a copy of the Chinese Belt and Road Initiative, which India is resolutely keeping out of.<\/p>\n Indian anger started with Chinese involvement in the Sri Lankan port of Hanbamtota and hasn\u2019t stopped. It is trying to mimic the Chinese strategy of \u2018a string of pearls\u2019 with Chabahar being one and Sittwe Port in Myanmar\u2019s troubled Rakhine State being another, although India is limited by its lesser spending power.<\/p>\n<\/p>\n SIDE<\/p>\n Looking inside for port improvements However, it is the four ports on the east coast, Enayam and Sirkazhi in Tamil Nadu, Tajpur in West Bengal and Paradip Outer Harbour in Odisha, that have stirred interest. No investment totals have been published and there is no official timeframe yet \u2013 suggesting that this is a long term-project.<\/p>\n Existing east coast ports are river ports, restricted to 1,100 teu because in large part the cost of dredging makes their development difficult, Ocean Shipping Consultants\u2019 Jason Chiang pointed out to Port Strategy<\/em> \u2013 meaning there is a need for something new and hopefully big.<\/p>\n \u201cThey can resolve it either by locating further out to sea or by dredging all the way in. It remains to be seen how this problem can be solved,\u201d Chiang added.<\/p>\n On top of this the Ministry has also identified other ports for extensive upgrading. “More than 150 projects have been identified for modernisation of existing ports including construction of new berths and terminals for major ports,” said Minister of State for Shipping Mansukh L Mandaviya.<\/p>\n One of these is Jawaharlal Nehru Port Trust where the first phase of the fourth container terminal was recently inaugurated. Work on the second phase is likely to commence by the end of 2019.<\/p><\/p>\n","protected":false},"excerpt":{"rendered":" With the Tariff Authority For Major Ports (TAMP) days numbered, terminals investors are rekindling their interest in India and getting ready to commit cash, finds Michael Mackay.<\/p>\n","protected":false},"author":8,"featured_media":207,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[25],"tags":[],"sponsor":[],"class_list":["post-206","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-asia"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/posts\/206","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/comments?post=206"}],"version-history":[{"count":1,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/posts\/206\/revisions"}],"predecessor-version":[{"id":208,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/posts\/206\/revisions\/208"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/media\/207"}],"wp:attachment":[{"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/media?parent=206"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/categories?post=206"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/tags?post=206"},{"taxonomy":"sponsor","embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/sponsor?post=206"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
<\/strong>India has extensive plans for port infrastructure inside India. Leading the way are plans by the Ministry of Shipping for six new ports, four on the east and two on the west coast. On India\u2019s west coast are Wadhwan in Maharashtra and Belekeri in Karnataka.<\/p>\n