By promoting coastal shipping of six commodities including coal and steel, annual potential savings of around 40,000 crores can be made, as much as Rs 40,000 crore could be saved by promoting cargo transportation by enhancing coastal shipping in 10 years under the ambitious Sagarmala project, a port-led development scheme, as per government estimates.
Sagarmala is an ambitious project to promote port-led direct and indirect development of coastal states and to provide infrastructure for transporting goods via ports quickly, efficiently and cost-effectively.
“Higher coastal shipment of coal by 100 million tonne per annum (MTPA) and higher coastal shipment of other commodities (cement, steel, fertilizers, food grains, POL) by 50 MTPA” alone could result in savings to the tune of Rs 11,500 crore by 2025, an official document on Sagarmala has said.
The building of new coastal capacities for 120 MTPA steel and cement in southern Gujarat, Central Andhra Pradesh, northern Karnataka, Odisha and northern Andhra Pradesh would result in savings of another Rs 8,500 crore, it said.
According to the document, another Rs 12,500 crore could be saved in the next ten years by reducing time to export container by five days through customs efficiency and last mile connectivity by building dedicated road corridors.
Apart from these, the government plans saving Rs 7,500 crore by increasing “share of railways in the modal mix from current 18 per cent to 25 per cent, creating “transshipment hub at Southern tip” and building “three new container ports” at Vadhavan, central Andhra Pradesh, and Sagar. It said these would reduce the cost to export by Rs 3,000 per container.
The government last month has announced to spend Rs 70,000 crore on development of major ports only which have received 104 suggestions from international consultants to increase efficiency.
Once implemented, this will result in cargo traffic increasing three-fold while the ports will also go underperformance audit.
Last month, Road Transport and Highways Minister Nitin Gadkari said, “Mahanadi Coalfields Ltd in Odisha is expanding its output capacity to 260 million tons from the present 60 million tons, and if the coal is transported through water, this will save Rs 7,000 crore annually.”
He has said two ports – Kandla and Paradip – were being developed into Green smart cities and the government is eyeing at Rs 4,500 profit from ports this fiscal.
Gadkari has said the Prime Minister’s emphasis is on “cooperative federalism” and Chief Ministers of states like Andhra Pradesh, Goa, Tamil Nadu, Karnataka, Maharashtra, Gujarat, and Odisha, who attended the first meeting of Sagarmala had come out with many good proposals.
He has said 13 states and union territories were involved in Sagarmala initiative which will be implemented across India’s 7,500 km coastline. The Cabinet had given ‘in-principle’ nod to the project, aimed at port-led development in coastal states.
Coastal shipping of thermal coal alone could amount to about half of the estimated savings, an official said. The government expects to increase its share in waterways transportation from 7% to 10% by 2020.
‘Coastal shipping of goods to save 40k cr per year’- Government
