Sagarmala is passe; Government begins work on new maritime vision

The Shipping Ministry has started work on drafting a new blueprint for India’s maritime sector for the next decade after the coronavirus pandemic decimated  previously laid down assumptions and projections on trade that formed the basis for Sagarmala, the flagship maritime program of the Narendra Modi-led government.

The government is close to hiring Boston Consulting Group (BCG) as a strategic consultant to help draft the ‘Maritime Vision 2030’ by co-ordinating with some 14 working groups set up by the Ministry on thrust areas identified by it, a top government official said.

“The Shipping Minister Mansukh Mandaviya wants a real vision for the maritime sector,” he said when asked about the need for a fresh blueprint when an elaborate plan for the Sagarmala program was prepared in 2016 to promote port-led development in the country.

Most of the thrust areas identified by the Ministry for the new vision has been extensively covered in the Sagarmala perspective plan.

“Vision reports are prepared every three years. It happens in every sector because external factors play a very key role. The vision need not be the same for ever. If somebody has assessed so much cargo traffic will be there by 2030, after this COVID-19 and so many changes which have taken place in the world, how can the vision still be realistic. It can’t be realistic. Realities have changed drastically since Sagarmala was finalised,” he said adding that Sagarmala could act as a base document for “preparing a realistic and achievable plan for 2030 with a proper roadmap”.

Some 605 projects costing over Rs 8.78 trillion were identified for implementation under the Sagarmala program in phases.

The Sagarmala program was written by US-based consultant McKinsey & Company. The program seeks to reduce logistics cost for export-import (EXIM) and domestic trade with minimal infrastructure investment.

This would be achieved by reducing cost of transporting domestic cargo through optimizing modal mix, lowering logistics cost of bulk commodities by locating future industrial capacities near the coast, improving export competitiveness by developing port proximate discrete manufacturing clusters and optimizing time/cost of EXIM container movement.

It encompassed port modernization and new port development, port connectivity, enhancement port-linked industrialization, coastal community development, promotion of coastal shipping and inland waterways, job creation and bridging skill gap in ports and maritime sector

The government also set up the Sagarmala Development Company Limited (SDCL) in 2016 to provide equity support for the project Special Purpose Vehicles (SPVs) set up by the Ports / State / Central Ministries.

BCG had earlier done a ‘Benchmarking and capacity maturity assessment report’ for the ministry basis which the capacity of the 12 Central government-owned ports was re-rated and enhanced to 1,359 million tons in 2017.