“We have formulated a package to promote Indian shipbuilding which will be taken to the Cabinet very soon,” Union Minister for Shipping G.K. Vasan announced here on Friday.

Inaugurating the Ports and Maritime Investment Business Conclave, organised by the Confederation of Indian Industry (CII), he said a new land policy and a policy to prevent monopoly in ports had also been brought out. The Ministry was working on a new policy to promote coastal shipping also.

Underscoring the importance of the ports and the maritime sector of India, he said 40 per cent of the country's Gross Domestic Product was linked to external trade, and the bulk of this international trade was carried through shipping.

“We also expect that in future, high demand for energy will result in increased import of coal and oil. Similarly the containers volumes in India are expected to witness very high growth.” This year also, “we are expecting a huge jump in India's trade.”

His Ministry was seized of various issues bedevilling the sector and hence had already come out with a number of policy initiatives. For instance, he pointed out that 100 per cent Foreign Direct Investment had been allowed in shipping and port sector.

Mr. Vasan stated that his Ministry had been taking various initiatives to rapidly modernise and develop the ports and maritime sector so that it could sustain and accelerate the current growth momentum.

In the last two years, 22 public-private partnership (PPP) projects had been awarded at a total investment of Rs.9,077 crore. To facilitate private sector investment, “we have put in place a favourable investor-friendly policy framework.”

Listing out the targets set in the Maritime Agenda, 2020, he said port capacity should be raised to 3200 million tonnes requiring an investment of about Rs.3 lakh crore, Indian tonnage should go up four fold to 43 million GT and India's share in global ship building should be taken to five per cent and the share of Indian seafarers to at least 10 per cent.

“To achieve these goals the Government will need the full co-operation of all stakeholders, particularly the private sector. Bulk of the resources needed to achieve the capacity targets is expected to come through PPP mode.”

Union Planning Commission member B.K. Chaturvedi said tariff deregulation, which had been the major demand of the sector, might come through in three to five years, at least in major ports. According to him, a major area of concern was the connectivity of the ports with rail and road so that “clogging” at the ports could be avoided. At the same time, he was sceptical whether preference for Indian tonnage, which existed earlier, could be revived in the current globalised scenario.

K. Mohandas, Secretary, Shipping, said an Indian Maritime Development Council, which could be a sort of a joint task force to sort out problems in the sector, could be formed.

N. Kumar, past president, CII, lamented that the cost of logistics in India was as high as 12 to 13 per cent which made it difficult to compete in the international arena. Besides, inter-sectoral co-ordination was poor.