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Editorial: Time to Make Major Port Authorities Bill 2016 into Guiding Beacon for Major Ports

Union Minister for Road Transport & Highways and Shipping, Mr Nitin Gadkari (file photo)

Port Wings, 23 Jan 2019:

It’s been two years now since the Shipping Ministry first came out with a new plan to remove archaic laws followed in managing Union Government-run Major Ports in the country with more dynamism, but the process of corporatization is still on.

And in February 2018, Cabinet had also approved changes in the Major Port Authorities Bill 2016, which will be replacing all those obsolete rules and regulations. Since then, no one, even the Ministry knows the actual status of the bill.

International trade is expected to play a larger role in driving the Indian economy in future. Consequently, the demand for cargo handling is expected to increase considerably over the years to match the astronomical growth that had happened in the port sector across the globe in the recent years. To match the growth, Indian Major Ports, which are infact the gateway for foreign trade, has to be augmented in both capacity and productivity.

Clearly, new facilities will have to be created to meet the projected growth in cargo demand as well as the port infrastructure.

The world today is witnessing a revolution in shipbuilding and 4000-teu capacity vessels are being phased out and the big liners are banking on 12,000-teus-21000 teus range vessels, which could be more economical as well as beneficial to all stakeholders.

On the port infrastructure front, many countries, from Far-East to Latin America, are promoting private players to develop their port infrastructure and well as encourage them to join together with government agencies to ensure sustained economic growth.

Whether in China or Latin America or Mediterranean, port infrastructure at these countries have received a boost after those governments engaged private players and developed the facilities there to match the global demand, be it quay length or ensuring productivity.

Due to such efforts, port infrastructure and productivity in those countries are setting new global standards in augmenting growth of EXIM trade.

Likewise, India also after economic liberalization in early 1990s, have roped in local as well as international players to develop port infrastructure. And due to those efforts, though many feel it was too late, infrastructure at the ports grown in the last two decades to meet the global standards.

Though the non-major ports, which are jointly promoted by leading private players and state governments, have grown faster than expected and now posing a serious challenge to the major ports managed by the Union Government.

Though there are some improvements, honestly speaking, the current performance of Indian Major Ports is significantly below international benchmarks of port productivity. First of all, the cargo handling performance of Indian ports needs to be improved.

For instance, the number of containers handled per ship per hour ranges also below the global average in Indian Ports when compared to leading international port.

After analyzing the pros and cons to meet the global benchmark in ease of doing business in the country, the BJP led government has taken a policy decision to go for corporatization of all major ports.

While the government defends the decision by asserting that it would enhance productivity and give sweeping powers to the boards to take market-driven decisions at ease, employees see it as a threat to their future.

Now, it is upto the government to prove the employees view on corporatization is wrong by taking apt measures while going forward on corporatization with human touch.

It would be instructive to bear in mind that the on-going reforms in the port sector is part of the overall reform process in the country.

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