Centre could redefine major ports, liberalise tariff regime

Shipping secretary K Mohandas on Monday said, there was a need to redefine major ports in a more rational way as the government is trying to liberalise the tariff regime and corporatise them.

As per the current definition, any port administered by the Centre is a major port irrespective of its cargo and passenger handling capacity while all other ports are termed as non-major ports.

Going by the current definition, there are 13 major ports and 187 non-major ports or minor ports in the country. Interestingly, some non-major ports have capacities larger than those of few major ports.

For example, Mundra Port and Special Economic Zone has a capacity of 30 million tonne, higher than three major ports?Ennore, Tuticorin and Cochin.

A major reshuffle will be required, in case the government decides to change the definition of ports as per their capacity. ?Ports have been defined in a manner, which has nothing to do with capacity. It is necessary to define them in a more rational way,? Mohandas said.

The shipping ministry is working on a plan to liberalise the current tariff fixation regime?under which Tariff Authority for Major Ports (TAMP) fixes the port charges that major ports can charge. The move is aimed at giving major ports a level-playing field with minor ports, which are free to fix competitive tariff and are able to attract higher traffic.

The ministry also plans to corporatise major ports, starting with Jawaharlal Nehru Port Trust. Rationalising the definition of ports is expected to enable the government to take better decision on which ports to corporatise and which not.

Mohandas also said the ministry is preparing a revised draft to extend shipbuilding subsidy beyond August 2007. ?We had talked to the finance ministry regarding shipbuilding subsidy but our proposal was not accepted. Now, we are in the process of preparing a new draft for shipbuilding subsidy as there is still a lot of demand from the industry for subsidies,? he said.

The shipping ministry is trying to convince the finance ministry to extend the shipbuilding subsidy beyond August 15, 2007, when the earlier subsidy ended.