The government today announced formulating a policy to encourage Indian controlled vessels to boost sea-borne trade and employment, saying its focus is on port connectivity besides developing Ganga as a waterway at a cost of Rs 4,200 crore to transport cargo.
"A policy for encouraging the growth of Indian controlled tonnage will be formulated to ensure increase in employment of the Indian seafarers. Development of ports is also critical for boosting trade," Finance Minister Arun Jaitley said in his Budget 2014-15 speech in Parliament.
Sixteen new port projects are proposed to be awarded this year with a focus on port connectivity, he said.
Also, he announced Rs 11,635 crore allocation for the development of Outer Harbour Project in Tuticorin for phase I.
"SEZs will also be developed in Kandla and JNPT," he said, adding: "A comprehensive policy will also be announced to promote Indian ship building industry in the current financial year".
Jaitley said development of inland waterways can improve vastly the capacity for the transportation of goods.
"A project on the river Ganga called 'Jal Marg Vikas' (National Waterways-I) will be developed between Allahabad and Haldia to cover a distance of 1,620 km, which will enable commercial navigation of at least 1,500 tonne vessels," he said.
The project will be completed over a period of six years at an estimated cost of Rs 4,200 crore.
Besides, Jaitley also announced rationalisation of duty on ship breaking scrap and melting scrap of iron or steel by reducing basic custom duty on ship imported for breaking up from 5 per cent to 2.5 per cent.
"Indian shipping industry had been representing that they are losing business in a tough global scenario, due to a provision in the Place of Provision of Services Rules, which is now being addressed through an amendment," he said.
Similarly, to encourage growth in the transport of goods through coastal vessels, the tax incidence is being reduced, he added.
India has 12 major ports - Kandla, Mumbai, JNPT, Marmugao, New Managlore, Cochin, Chennai, Ennore, V O Chidambarnar, Visakhapatnam, Paradip and Kolkata (including Haldia), which handle approximately 61 per cent of country's total cargo traffic.
These ports had handled 560.13 MT of cargo in 2011-12 and 596.03 MT cargo in 2010-11. The present capacity of major ports is only about 700 MT, while the Maritime Agenda of the Ministry has fixed a target of 3130 MT capacity addition by 2020.
Last fiscal, the government awarded 30 projects to augment major ports capacity to 220 million tonnes per annum.
