India at 75th Year of Independence- Ministry of Ports, Shipping and Waterways

The maritime sector of India has been the backbone of the trade and global economy and has been contributing to the social and economic development of the country. The industry is not only responsible for the country’s trade and commerce but also enables the country and the world to access day-to-day needs. The Ministry of Ports, Shipping and Waterways, earlier known as the Department of War Transport, was formed in July 1942 by the bifurcation of the then Department of Communications into two Departments, namely the Department of Posts and the Department of War Transport. At that time, the department was responsible for handling the Major Ports, Railways priorities, utilization of road, water transport, petrol rationing and producer gas. The primary function of the department was to coordinate and look after the demand for transport in wartime, Coastal Shipping, and the administration and development of major ports.

The Ministry of Shipping was formed in 2009 by bifurcating the erstwhile Ministry of Shipping, Road Transport and Highways into two independent Ministries. The department has undergone many subsequent changes from time to time in its organizational structure and its functions. In 2020, it was renamed the Ministry of Ports, Shipping and Waterways from the Ministry of shipping. It is the apex body for formulation and administration of the rules and regulations and laws relating to ports, shipping and waterways, currently headed by Union Minister for Ports, Shipping & Waterways and Ayush, Shri Sarbananda Sonowal. The sector is responsible for the social and economic development of the maritime sector of the country.

India has a sizable maritime sector, with 12 major and 205+ non-major ports located along its 7517 km long coastline, as well as 14,500 km of potentially navigable waterways in strategic locations along key international maritime trade routes. The country’s maritime sector is critical to its overall trade and growth, accounting for 95 percent of the country’s trade volume and 70 percent of its trade value via maritime transport via sea routes. The Indian ports and shipping industry are critical to the country’s trade and commerce growth, where the government is an essential supporter of the port sector. It has permitted up to 100 percent FDI under the automatic route for port and harbour construction and maintenance projects. It has also made a 10-year tax break available to businesses that develop, maintain, and operate ports, inland waterways, and inland ports. India’s key ports had a capacity of 1,561 million tonnes per annum (MTPA) in FY21. In FY22 (until February) 2022, all key ports in India handled 650.52 million tonnes (MT) of cargo traffic. India’s merchandise exports in FY22 were at US$ 417.8 billion, up 40% from the previous year. In October 2021, India’s merchandise exports grew 43.05% year-over-year to reach US$ 33.65 billion.

In February 2021, the Parliament of India passed the Major Port Authorities Bill, 2020. The bill aimed to decentralize decision-making and reinforce excellence in major port governance.

The government has undertaken numerous initiatives and projects to encourage and promote India’s Blue Economy in order to make the industry more efficient in order to increase connectivity. India and Russia discussed collaborating on shipbuilding and inland waterways in December 2021. Mr. Sarbananda Sonowal, Union Minister for Ports, Shipping and Waterways, and Ayush inaugurated the new Radars and Vessel Traffic Management System of Cochin Port Trust in November 2021, as well as the simultaneous launching of five vessels at Cochin Shipyard Limited (CSL) and many more towards the development of capacity enhancement, port connectivity, and so on. As a result, 150+ initiatives were launched around these key themes.

The Sagarmala Programme is an initiative by the government of India to enhance the performance of the country’s logistics sector, launched by the Honorable Prime Minister, Narendra Modi in 2015; in the 75th year of independence, it has completed successful seven years of a vision for prosperity and a vision for transformation. The project aims to reduce logistics costs for domestic and EXIM cargo with optimised infrastructure investment. It also aims at transforming the existing Ports into modern world-class Ports and to integrate the development of the Ports. The Industrial clusters and hinterland and efficient evacuation systems through road, rail, inland and coastal waterways resulted in Ports becoming the drivers of economic activity in coastal areas. In the past seven years, the Sagarmala project worked on five major pillars that are Port Modernisation, Port connectivity; Port led Modernisation, Coastal Community development and Coastal shipping and Inland water trade. In 2016, the National Perspective Plan (NPP) was prepared and released under which 175 Projects & later adding 415 projects in 2020, of which 121 were under implementation and 294 were under development. By March 2021, more projects of which were added after consulting with the implementing agencies. It has now over 802 projects of which 202 have been completed, 216 are under implementation and 384 are under development.

In 2020 at the Maritime Summit, the Maritime Vision 2030 (MIV 2030) was launched by Prime Minister Narendra Modi, a 10-year blueprint to overhaul the Indian maritime sector to ensure coordinated and accelerated growth of India’s maritime sector in the next decade, intending to drive India to the forefront of the Global Maritime Sector. Vision 2030 defined six key guiding principles, which are:

  1. Analyse current and future challenges to determine initiatives.
  2. Drive innovation by utilizing the latest technology.
  3. Create a time-bound action plan.
  4. Benchmarks to understand current standing and adopt best-in-class practices.
  5. Address capability building and human resources and lastly, explore ideas to achieve “Waste to Wealth”.

Moreover, 10 key themes were outlined to be worked around for Vision 2030 revolving around

  • The development of best-in-class Port infrastructure
  • Enhancing logistics efficiency through technology and innovation,
  • Strengthening policy and institutional framework to support all stakeholders,
  • Enhancing global share in shipbuilding, repair, and recycling,
  • Enhancing cargo and passenger movement through inland waterways,
  • Promoting ocean, coastal and river cruise sector,
  • Leading the world in safe, sustainable & green maritime sector,
  • Enhancing India’s Global stature and maritime co-operation
  • Become the top seafaring nation with world-class education, research & Training.

However, a few challenges for the shipping industry remain. Today, India’s private shipbuilding industry is in decline and is heavily reliant on government contracts. Six of India’s 28 shipyards are public sector undertakings (PSUs), two are state-owned, and the remaining 20 are privately owned. Therefore, India is also trying to Indianise its shipbuilding industry to generate more employment and enhance its capability with the help of several sectors, including Cochin Shipyard Ltd., Mazagon Dock Ltd, Hindustan Shipyard Limited, etc. The global shipbuilding industry is highly competitive, and India has fallen behind, accounting for less than 1% of global shipbuilding. India’s private shipbuilding industry is currently declining, and the sector is trying to change this course by taking efforts in the required direction.

The industry lacks in a few areas and requires vision to work on those areas through these initiatives and Vision 2030. It is expected that by 2030, India’s Maritime sector will be one of the leading contributors in the sphere of trade and commerce and will also be the largest sector to contribute toward employment opportunities and revenue generation through cruise tourism and will be leading the world towards safe, sustainable ad green maritime sector. The goal is to increase the country’s seafaring share to 20% of the global market by 2030, up from 12%, now.