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Sagarmala National Perspective Plan
Apr 27, 2016

At the inauguration of the Maritime India Summit in Mumbai recently, Prime Minister Narendra Modi released the National Perspective Plan detailing the contours of Sagarmala, the government’s flagship programme to promote port-led development in the country.

The National Perspective Plan has been crafted after detailed consultations with key stakeholders in the central and state governments, public sector companies as well as private players from shipping, ports, ship-building, power, cement and steel sectors.

Promoting water transportation is priority of the Government as it will considerably reduce the logistics cost which is very high in India compared to China and European nations.

Key Features

  • It takes forward Sagarmala’s vision of substantially reducing export-import and domestic trade costs with a minimal investment.

  • The report estimates that the programme could lead to annual logistics cost savings of close to Rs 35,000 crore and boost India’s merchandise exports to $110 billion by 2025.

  • About one crore new jobs are estimated to be created, of which 40 lakhs will be direct employment.

Four Strategic Levers of the Plan

Sagarmala aims to deliver impact through over 150 projects and initiatives in four broad areas.

1. Optimizing multi-modal transport to reduce the cost of domestic cargo.

2. Minimizing the time and cost of export-import cargo logistics.

3. Lowering costs for bulk industries by locating them closer to the coast.

4.  Improving export competitiveness by locating discrete manufacturing clusters near ports.

Firstly, to modernize India’s port infrastructure, 5 to 6 new ports have been proposed to be built. Additionally over 40 port-capacity enhancement projects will be taken up. Besides increasing capacity, these projects will result in a more modern port infrastructure through the mechanization of berths and deepening of drafts to accommodate larger vessels.

The second focus area is port connectivity, where over 80 projects are being planned. These include connectivity infrastructure projects like a heavy-haul rail corridor to evacuate large volumes of coal in Odisha, freight-friendly expressways to enable efficient movement of containers on key routes, and the development of strategic inland waterways.

The third set of projects aims to tap into the potential of port-led industrialization to boost industrial and export growth along the coastline. This will be realized through 14 Coastal Economic Zones (CEZs) along the coastline, each of which will house a number of industrial clusters. The clusters will have industries from the energy, bulk materials as well as discrete manufacturing segments, all of which will be able to use high-quality infrastructure which is fully-integrated with the corresponding ports.

Finally, the potential of coastal communities will be harnessed by focused skill-development to support port-led industrialization. The set of initiatives under this head also includes developing opportunities for fishermen and other coastal communities as well as development of the numerous islands along India’s coastline. In terms of economic impact, the program envisages investments of close to Rs 4 lakh crore to flow into infrastructure.

Other Important Information

  • The potential for port-led development has for long been constrained in India by high logistics cost, long lead-times and poor linkages between industrial and logistics infrastructure.

  • Growth was hindered by inadequate and poor port capacity. Transportation by waterways has historically remained under utilised in India although waterways are significantly cheaper compared to road and railways.

  • The Sagarmala National Perspective Plan identifies specific opportunities for transportation of commodities such as thermal coal, fertilisers, foodgrains, cement and steel by coastal shipping and inland waterways.

  • With a coastline of about 7,500 km covering 13 states and Union Territories, India enjoys a strategic location on key international trade routes.

  • Nations like the United States, Japan, Korea and more recently, China, have leveraged their coastline and waterways to drive industrial development. The Sagarmala programme aims to replicate these successes in India.

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