Government of India has recently clarified that there are no ongoing discussions about the privatisation of shipping and ports. The Ministry of Ports, Shipping and Waterways (MoPSW) made this statement to the parliament in response to two years of speculation about potential privatisation plans.
It further emphasised that all 12 Major Ports, which are entirely owned by the Central Government, have not been privatised.
However, the government has shown openness to Private Sector Participation through Public-Private Partnerships (PPPs). Under these partnerships, private entities can engage in specific projects, berths, and terminals through concession agreements.
These agreements are established for a set period and involve a competitive bidding process. The terms of the agreement include a revenue-sharing or royalty arrangement between the concessionaire and the Major Port Authority.
Despite the global trend towards privatisation and economic shifts, the Indian government has maintained a cautious approach. This stance is particularly relevant given the transformative changes currently being witnessed in the shipping and port sectors worldwide.
In a related development, DIPAM Secretary Tuhin Kanta Pandey, earlier when asked about the privatisation of the Shipping Corporation of India (SCI), stated that while the privatisation has been delayed, it is not off the table.
Furthermore, KV Subramanian, the former Chief Economic Advisor to the Government of India, suggested that disinvestment might accelerate after the elections.
The government’s commitment to PPPs indicates its strategy to leverage private investments while retaining control over critical infrastructure assets.
