The shipping ministry is expected to leave 75% of approved outlay in the 11th Five-Year Plan unutilised as delays in awarding projects and poor planning have led to postponement of expenditure.
Planning Commission had approved an expenditure of R30,305 crore for the 11th Plan for the ministry but it is likely to spend only R7,685 crore by the end of the Plan period, that is March 31. This clearly indicates the ministry’s inability to come up with bankable projects so as to be eligible for receiving the funds approved at the start of the Plan, given the development needs of the sector.
The poor run is expected to continue in the new Plan with officials seeking a lower outlay of R26,021.64 crore during 12th Plan.
Shipping secretary K Mohandas told FE that companies like Shipping Corporation of India and Dredging Corporation of India could not implement their spending plans during the 11th Plan as business assumptions proved wrong.
?We had projected acquisition of ships by Shipping Corporation of India when we projected the outlay for 11th Plan, but things did not turn out as planned and the firm had to postpone implementation of its buying plan,? he said.
Mohandas said projects could not be awarded in time, as was evident in port sector where no project was bid out in the first half of the 11th Plan period for want of standard bidding documents. However, the performance of major ports could not improve even in the second half with disgruntled bidders going for litigation. ?Certain projects had to be restructured,? he added.
Planning Commission officials said although the original approved outlay was R30,305.16 crore for the plan, but lack of projects forced the shipping ministry to seek lower allocations every year with the five year period ending with approved outlay of just over R12,888.19 crore or half of originally proposed outlay (see chart). ?There was lack of bankable projects from shipping ministry,? one of the officials said.
This year major ports that are controlled by the Centre awarded only one project against the target of 23. Last year’s performance was also discouraging as only nine projects were out of 21 planned. A year before that, only six out of 17 projects were bid out.
With the number of projects awarded being low, achieving the capacity addition target for major ports is going to be a distant dream. As per a shipping ministry’s report, major ports would increase their capacity by 200 million tonne (mt) in the 11th Plan against the target
of 511 mt.
