Shipping min shelves plan to create major ports regulator

Written by Sunny Verma | New Delhi | Updated: Dec 19 2012, 08:55am hrs
Facing stiff opposition from maritime states, the shipping ministry has shelved the plan to create a major ports regulatory authority (MPRA). The new regulatory authority was proposed to subsume and replace the Tariff Authority for Major Ports (TAMP) and regulate tariff rates at all major and non-major ports and to monitor performance standards of facilities and services offered at all ports in the country.

A Planning Commission committee had also advised against setting up of the authority in July. Sources said the shipping ministry has withdrawn the proposal of creating the MPRA as well as state port regulatory authorities. The state authorities were proposed to have regulatory jurisdiction of all ports excluding major ports. The proposal was opposed by maritime states like Andhra Pradesh and Gujarat, which saw this as an unnecessary regulatory intervention.

In 2011-12, Indian ports handled 915 million tonnes (mt) of cargo, an increase of 3.4% over 2010-11, with minor ports showing faster traffic growth than their major counterparts. In its July report on the draft port regulatory authority Bill, an inter-ministerial task force, after consulting the states, advised against setting up of the MPRA, prompting the shipping ministry to drop the plan. The finance ministry had also opposed the creation of the new regulatory authority.

The MPRA was proposed to streamline tariff setting at major ports (regulated by TAMP) and minor ports (regulated by state maritime boards). In its inputs to the task force, Jawaharlal Nehru Port Trust (JNPT) supported a independent regulatory system encompassing major and minor ports, but argued against regulated tariffs.

The regulatory authoritys role should be limited to standard setting and not tariff setting, which must be left to the market, subject to non-restrictive practices. This is necessary as private operators are shifting business to non-major ports from major ports as their tariff is unregulated, JNPT had said.

The task force said the MPRA would lead to excessive regulation stifling growth in the sector.