Gujarat has planned more than 40 ports, and this overwhelming number has both been welcomed and has raised questions. AK Rakesh, Vice Chairman & Chief Executive Officer, Gujarat Maritime Board, interacts with Janaki Krishnamoorthion various issues related to ports in Gujarat.
Gujarat ports are widely perceived to be a success story. What factors would you attribute to it?
One of the foremost reasons is our decision to thread through an unexplored route and leverage upon the advantages derived out of being first. Apart from setting up the first Maritime Board in the country, Gujarat is also the first state to announce the investor-friendly Port Policy in 1995 which propelled port development. This visionary document spelled out an explicit strategy envisaging development of ten new greenfield and world-class ports where the private sector would play a dominant role. Our progressive policies offer complete tariff and operational freedom, long-term commercial arrangements, attractive concessions on port charges, bankable project documents like the Model Concession Agreement and a host of other benefits to private entrepreneurs willing to join hands with the state in port development. Moreover, the state's track record of successfully implementing private port projects, the hand-holding approach and the concept of single-window clearance has instilled a sense of confidence in the investors.
How many port projects have been completed so far in Gujarat with private participation? How many are under construction and in the pipeline? What has been the investment range?
We encourage participation in not only development of private ports, but also captive jetties, private jetties, mechanisation of port facilities etc. Total private investments to the tune of more than Rs 28,000 crore have been realised till date. Private ports have been developed at Pipavav (the first private port of the country), Mundra, Dahej and Hazira. Dahej and Hazira are the first two operational LNG ports in the country. The existing private port of Mundra is also expanding.
Private ports coming up at Chhara, Kacchigadh, Nargol and Dahej are in various stages of development. Construction of a coal terminal at Salaya is underway and a captive jetty for cement is also under final stages of implementation at Kutch.
We intend to invite private participation for developing a private port at Vansi Borsi. In terms of value, investments of Rs 9,000 crore are envisaged for the above mentioned projects in the first phase.
While non-major ports' total cargo throughput ha been increasing in the last few years, it has been declining for the major ports . What are the reasons behind this trend?
Yes, throughput of major ports has shrunk by about 2.6 per cent. However, what is significant here is that during the same period, Gujarat's non-major ports have grown by 13 per cent. Congestion and capacity hinder port operations, which have been taken care of by creating additional capacity and establishing last mile connectivity to our ports. Along with development of ports, port-led development is also our thrust, and hence port-based SEZs and SIRs also contribute significantly to the cargo throughput.
What are the major challenges encountered by GMB in PPP port projects?
In today's globalisation, the port sector faces three main challenges. Firstly, projects have a long gestation period and have to pass through a very rigorous regulatory framework. Secondly, the trade cycle impacts the port sector more than any other infrastructure sector. Thirdly, intrusion of sea by elements inimical to the country's sovereignty has made coastline security a big challenge and consequently increases the operational costs. Land acquisition and environment clearances also pose problems at various stages of the project. There have been instances where the project site had to be relocated due to such issues like the L&T's port which was shifted to Kacchigadh from Sutrapada and a proposed port near Simar was relocated to Chhara.