PM estimates port capacity addition at 40% below Eleventh Plan target

A high-level meeting chaired by Prime Minister Manmohan Singh has observed that the government will fall short of the 11th Plan target for capacity addition in major ports by around 40%. The target was to add a capacity of 511 million tonne which would have taken the total capacity of the 12 major ports to over 1,000 mt.

The main reason for the slippage is the delay in awarding the public-private partnership projects, which the shipping ministry and the Planning Commission have blamed each other for.

With its inability to meet the target for current Five-Year Plan ending March 31, 2012, the government will also fail to meet the capacity addition projection under the ambitious National Maritime Development Programme (NMDP).

The conclusion that a 40% slippage is certain was arrived at after Planning Commission member BK Chaturvedi made a presentation to Singh, who is also the Commission?s chairman. Planning Commission deputy chairman Montek Singh Ahluwalia and shipping minister GK Vasan were also present in the meeting that took place on February 3.

According to official sources, the Commission criticised the shipping ministry for its failure in ensuring timely award of port development projects in the last two years. The 11th Plan target was to create an additional capacity of 511 mt in the 12 major ports. In the meeting, it was decided that the target would stand revised to 311 mt?which means total projected cargo handling capacity of major ports would be 815.75 mt by the end of the Plan.

While Vasan admitted to the delay, he held Planning Commission responsible for the same, a senior government official told FE, requesting anonymity.

Vasan said the first two years of the Plan period, 2007-08 and 2008-09, ?did not see much action in the port sector due to absence of proper documents like model concession agreement, request for qualification and request for proposal?.

?The ministry was in continuous discussion with the Planning Commission for finalising these documents,? Vasan informed Manmohan Singh. Since these documents are in place now, the implementation of port projects would gather momentum, the minister said. But he conceded the plan target could not be met.

Highlighting the performance of shipping ministry in the current financial year, Vasan said his ministry has awarded 10 projects so far in the current fiscal. However, most of these projects pertain to 2008-09 which were carried forward to this fiscal.