An Overview

Over the years, maritime transport has emerged as a critical contributor to the trade competitiveness of a country. Consequently, for many countries with an adequate coastline, maritime infrastructure development has attracted significant investments, thereby influencing the pace, structure and pattern of development in the country.

India has an extensive coastline of around 7,500 kms. Around 95% (by volume) and 70% (by value) of external merchandise trade is carried out through maritime transport in the country. The shipping industry has grown in terms of physical and financial assets, human resources, knowledge base, operating processes and support infrastructure over the years. The total traffic handled at Indian ports (major plus minor) has increased at a CAGR of 9.9% from 460.1 million tons in FY04 to 738.2 million tons in FY09. The annual aggregate cargo-handling capacity of major ports increased from 574.77 MT per annum in 2008-09 to 599.00 MT in 2009-10. The Major Ports handled a total traffic of 560.96 Million Tonnes (MT) in the financial year 2009-10 an increase of 5.74% over 530.53 MT handled in 2008-09.

The projected traffic of Major Ports during 2011-12 is 615.70 MT, and a capacity of about 800 MT is required to meet this traffic. Indian ports today are operating at more than 90% capacity utilization. Therefore, huge amount of investment is needed in the major ports to boost the infrastructure in the next few years. Considering the importance of Indian ports in the foreign trade National Maritime Development Programme (NMDP) initiative is taken by the Ministry of Shipping. In which, 276 projects were identified with an estimated investment of Rs. 55804 crore at 2004-05 prices for implementation between 1 April, 2005 and 31 March 2012.

To encourage private investment in the port sector Ministry of Shipping opened up areas for private sector and offer concessions like 100% FDI for port development projects, 100% income tax exemption for a period of 10 years etc to the private players.