Everything You Need to know about GOI’s Sagarmala Project

Hello Readers,

As you all know trade is one of the major thing which plays an important role in country’s GDP(Gross Domestic Product). India is seventh largest nation of the world and is surrounded by sea from three directions, which makes it one of the biggest coastlines of the world. Considering such a vast coastline of more than 7,500 Km India should ideally do more than 90 per cent of its import-export through sea, which is not how it happens and thus there is a huge gap in what we have and what we are currently doing.

download (4)Ironically, the ports contribute to just 1 per cent of the entire GDP, whereas the road sector contributes 6 per cent and railways 9 per cent towards the GDP. There is a huge contradiction in what we can do with our coastlines. If we identify as to what is the reason for such a poor contribution of ports towards the GDP, we would find that it is nothing but inadequate linkage of ports and poor infrastructure, which leads to such a meager utilization of ports. So it is very important and the right time that our Indian Government implemented this project towards “blue revolution”, which is Sagarmala Project.

The History

  • The Sagarmala project was mooted by the Vajpayee govt in 2003, but shelved by the UPA
  • It was supposed to be the shipping equivalent of the Golden Quadrilateral, which revived India’s roads

The Revival:-

  • On 15 August 2014, PM Narendra Modi announced a revival of the project Shipping minister Nitin Gadkari says the govt will spend Rs 70,000 crore on a heavily revised project
  • On 25 March 2015, The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi, gave its ‘in-principle’ approval for the concept and institutional framework of Sagarmala Project.

What is Sagar Mala Project?

The Primary objective of Sagar Mala Project is to,

  • promote ports, which leads to direct and indirect development
  • provide infrastructure to transport goods to and from ports quickly, efficiently and cost effectively
  • modernise the existing ports connecting road, rail, inland and costal waterways to drive the economic activity

To make it simple, it is revitalising the major ports in coastal area and connect it directly with all the major trade routes to benefit the economy.

Hinderance behind this project:-

The growth of India’s maritime sector is constrained due to many developmental, procedural and policy related challenges namely,

  • involvement of multiple agencies in development of infrastructure to promote industrialization, trade, tourism and transportation;
  • presence of a dual institutional structure that has led to development of major and non-major ports as separate, unconnected entities;
  • lack of requisite infrastructure for evacuation from major and non-major ports leading to sub-optimal transport modal mix;
  • limited hinterland linkages that increases the cost of transportation and cargo movement;
  • limited development of centres for manufacturing and urban and economic activities in the hinterland;
  • low penetration of coastal and inland shipping in India, limited mechanization and procedural bottlenecks and lack of scale, deep draft and other facilities at various ports in India.

What will be created under this project?download

The blueprint of the Sagar Mala project—an infrastructure-cum-policy initiative being readied by the shipping ministry—seeks to allow the central government to have a say in the development of non-major ports without adopting a confrontationist approach with the state governments.

Current Infrastructure of Coastline:-

For no reasons, the government so far in India have never focused entirely on developing a good coast line for the nation. If we look at some of the developed nations of the world like Netherlands, Dubai, Korea, Japan, China; some of these countries do not have a bigger coastline like India but still they have developed their coast line with modern techniques for export import to prosper without any hindrance.

What are the changes to be done??

  • The new sites identified to be converted into ports are Sagar Island (West Bengal), Vadhavan (Maharashtra), Colachel ( Tamil Nadu) and Tadadi (Karnataka).
  • Establishment of Indian Port Rail Corporation has also been done under Sagarmala project.
  • The government could save around Rs 40,000 crore every year in logistics costs and time reduction for key cargo movement when Sagarmala is fully developed.download (5)

Under the initiative that also includes connecting ports with inland waterways, the government will set up 14 coastal economic zones and a special economic zone at Jawaharlal Nehru Port Trust (JNPT) in Mumbai. Free trade warehousing zones will be set up in Cochin and Ennore. The Sagarmala Yojana would undertake redevelopment of new and existing ports through upgrading them to be developed enough to handle extensive use of equipments and IT and thus bring in an improved monitoring and hi-tech infrastructure for day to day business activity. The Jawaharlal Nehru Port Trust itself, which is one of the biggest ports in India, would alone get a big amount of Rs 4,000 Crore for development as an SEZ.

So far what have been done??

  • Twelve projects have been identified for taking up under Sagarmala in FY 15-16 out of which 6 projects have been approved and fund of Rs 90 crore has been released in three projects.
  • Ten additional projects have been taken up for DPR (detailed project report) preparation, 58 road projects and 23 rail connectivity projects have been submitted to Ministry of Road Transport & Highways and Ministry of Railways respectively for consideration.
  • The Minister said preparation of detailed master plans for the Coastal Economic Zones (CEZs) is being done and Perspective Plans for 14 CEZs are under development. As part of the Sagarmala institutional framework, the National

Sagarmala Apex Committee (NSAC) was constituted on May 13, 2015 and its first meeting was held on October 5, 2015. Following Prime Minister Narendra Modi’s intervention recently, it has been decided to finish Sagarmala project in five years instead of 10 years to create a massive 10 million jobs. The central government has allocated Rs 692 crore for FY ’15-’16 for launching of the initial phase.

Outcome of Sagar Mala Project:-

  • The central government’s plan to go for integrated development of the maritime sector and turn the coast into economic hubs through a collaborative approach with the states will eschew the need for a time-consuming and legislative framework to carry out this task.
  • The states, too, have much to gain from such a collaboration because it would ensure funding and other institutional support from the centre.

Sagar Mala would not have come at a more opportune time for the central government-owned ports, many of which are losing market share to non-major ports mainly due to regulatory reasons. Extending a collaborative hand would help stem the rot and allow both set of ports to grow without eating into each other.