Despite the slippages of recent years, the shipping ministry has set an ambitious target to award 23 projects worth R16,750 crore for capacity addition at majors ports this fiscal. This is more than the awards in the last four years combined, signalling the renewed emphasis on investments in the port sector, vital in pushing the country?s foreign trade.

Last year, legal wrangles caused considerable delays in the process and just nine projects entailing investments of about R3,000 crore were awarded. The target was fixed at a meeting between shipping secretary K Mohandas and Planning Commission member BK Chaturvedi on May 18. In last four years, the ministry awarded a total of 22 projects, 15 of which came after the model concession agreement of mid-2009.

The 2011-12 target has been set with an intention to close the 12th Plan on an encouraging note. ?We have failed in project awards mainly due to factors beyond our control like court cases by bidders. The model concession agreement which is the basis of public-private partnership projects was finalised only in mid-2009, more than two years into the Plan,? Mohandas told FE. ?In our assessment, we should be able to award 23 projects this year, but they will add to the capacity only after two years,? he added.

Because of the failure in awarding enough projects in the past four years, the shipping ministry is unlikely to achieve the already-reduced target of adding 311 million tonne capacity during the 11th Plan period. At the most, the ministry would add 200 million tonne to the cargo handling strength of 13 major ports. In the 10th Plan too, capacity of major ports increased by only 160 million tonne.

On the other hand, minor ports will race ahead in adding capacity. India’s 176 minor ports are expected to end the 11th Plan with 499 million tonne, more than twice their capacity in the previous Plan. The combined capacity of minor ports was 228 million tonne at the beginning of 10th Plan.

As per the Plan document prepared by the Planning Commission, the shipping ministry was given a target of adding 511.8 million tonne to major ports’ capacity with private sector participation. However, in 2009-10, Prime Minister Manmohan Singh, who heads the Planning Commission, reduced this target to 311, citing the ministry’s poor performance in awarding projects.

Some ministry officials feel that the new target is too big. ?In the last four years, we have increased capacity of major ports by 140 million tonne to 644 million tonne. This is way below what we had endeavoured to do. As per our current assessment, we could add only 200 million tonne to take the capacity to 704 million tonne,? a senior official in the shipping ministry said.

On traffic, however, the ministry is expected to inch closer to the goal.

The target was to facilitate yearly traffic flow of 708 million tonne at major ports by March 31, 2012, and the ministry expects to reach 630 million tonne.

Here too, minor ports will perform better with their share of the total traffic rising from 27% on March 31, 2007 to 38% by the end of 2011-12 by getting a cargo traffic of 402.5 million tonne.