Ship building is a huge employment multiplier and the new comprehensive policy, which has been approved by the Cabinet, will generate manufacturing-led employment, said Nitin Gadkari. (File Photo)
As a new year beckons, the government plans to weed out several archaic rules, some of which are over 100 years old, relating to shipping sector and also harness inland waterways, lighthouses and islands as new growth drivers of the Indian economy.
Terming the revamp of shipping sector as a high-priority agenda for 2016, Union Minister for Shipping Nitin Gadkari said that the new ship building policy will also give a major boost to the government's "Make in India" initiative while the country's vast coastline will see major development projects.
Ship building has a huge employment multiplier and the new comprehensive policy, which has been approved by the Cabinet, will generate manufacturing-led employment, he added. "We have scrapped about 20 archaic laws which had no relevance today and would weed out more such obsolete provisions," Mr Gadkari told the Press Trust of India.
The industry has for long been complaining some 'biased' taxation and operational issues that have been hurting the interest of Indian shipping companies, including for import of goods and purchase of ships.
"We are re-looking at most of our Acts some of which are more than 100 years old and we expect that in the next six months we should be able to revamp Acts like Major Ports Act, Merchant Shipping Act, doing away with TAMP (Tariff Authority for Major Ports) and so on," Shipping Secretary Rajive Kumar said.
The step will be a welcome breath for Indian ship owners who view the age-old laws as a hindrance to sector's growth.
To promote "ease of doing business", the Shipping Ministry recently decided to weed out 13 archaic rules under the Merchant Shipping Act.
The government this month approved a proposal for financial assistance of 20 per cent for ships built in the country, while providing for a budgetary support of Rs 4,000 crore.
Mr Gadkari said the government is also planning to set up two new ports -- one in Maharashtra and the second in Tamil Nadu -- in addition to already approved Sagar port in West Bengal and work on these ports would begin by March.
Also on anvil is a central legislation to declare 106 additional inland waterways as national waterways. Currently there are only five national waterways in the country.
"Converting rivers across the country into waterways will usher in unexpected economic growth for the country," the minister said.
Inland water transport is considered very cost-effective as far as fuel efficiency is concerned, Mr Gadkari said, while adding these waterways can help India join the "league of European nations whose economy thrive due to their waterways."
Quoting a World Bank study, Mr Gadkari said one litre of fuel can move 105 tonne per km by inland water transport whereas the same amount of fuel can move only 85 tonne per km by rail and 24 tonne per km by road.
The government is focusing on waterways as transport through rivers is much cheaper and costs barely 30-40 paise per km in comparison to Re 1 through railways and Rs 1.5 through roads, he added.
Also on the union minister's radar is the development of India's lighthouses and islands.
Enthused by a higher tourist footfall at historic lighthouses of Mahabalipuram and Cannanore, an ambitious plan has been drawn to unlock their rich history and heritage.
India has 189 lighthouses dotting its 7,517-km vast coast line, including the Andaman and Nicobar Islands in the Bay of Bengal and Lakshadweep Islands in the Arabian Sea.
The identified lighthouses are in Gujarat, Maharashtra, Goa, Karnataka, Kerala, Lakshadweep, Tamil Nadu, Puducherry, Andhra Pradesh, Odisha, West Bengal and Andaman and Nicobar. Steeped in rich maritime heritage, each lighthouse has its own story to tell and has tremendous tourism potential to be tapped.
Land adjacent to these lighthouses may have hotels, resorts, viewing galleries, maritime museums and heritage museums, adventure sports facilities, thematic restaurants, souvenir shops, LASER shows, spa and rejuvenation centres, amphitheatres and allied tourism facilities to attract tourists, the Minister said.
Globally, lighthouses tend to attract tourists with their scenic and serene surroundings and rich maritime heritage. Another important focus area in the New Year would be the Sagarmala Project, which is aimed at port-led development in coastal areas, Mr Gadkari said, while adding the project will give a major boost to the Indian economy.
The government has lined up about Rs 70,000 crore for its 12 major ports only, he said. "Ports play a pivotal role in boosting the country's economic growth. Logistic cost has to be reduced. Our logistic cost is thrice than China's. We are not able to compete with global markets," he added. Mr Gadkari further said that ports will play huge role in double digit GDP target and port, shipping and highways sector will very soon add 2 per cent to the country's GDP.
Mr Gadkari said tenders for development of 16 such projects have already been floated and the government is looking at promoting export of exotic variety of fishes, roping in local youth in projects through skill development.
He said that 13 states and union territories were involved in Sagarmala initiative which will be implemented across India's 7,500 km coastline.
At the same time the government has already started a strict monitoring of all the projects to ensure their timely completion.
Shipping Secretary Rajive Kumar said there the cargo growth rate has doubled from 4 per cent in 2013-14 to 8 per cent in 2014-15.
"Major Ports added additional capacity of 71 MTPA in 2014-15 which is the highest in any particular year so far. This was achieved by close monitoring of the on-going projects," he said.
"The Cargo handling capacity of Major Ports in March 2015 was 871.52 Million Tonnes. This is a result of strengthening of infrastructure in Major Ports for handling coastal cargo. A new scheme to provide financial assistance to Major Ports to set up exclusive coastal berths is under implementation. Wherever feasible, green channel facilities have been put in place for coastal cargo," he said.
To focus on improving the last mile connectivity to ports, a new Special Purpose Vehicle (SPV) is being formed with equity contribution from all Major Ports and Rail Vikas Nigam Limited, he added.
Similarly, an SPV to take up strategic port development overseas has been formed under the name Indian Ports Global Limited, Mr Kumar said, adding this SPV will take up development of Chabahar Port in Iran to begin with.
India has 12 major ports -- Kandla, Mumbai, JNPT, Marmugao, New Mangalore, Cochin, Chennai, Ennore, V O Chidambarnar, Visakhapatnam, Paradip and Kolkata (including Haldia) -- that handle approximately 61 per cent of the country's total cargo traffic.