What is the Sagarmala Project?
About:
- The Sagarmala Project was approved by the Union Cabinet in 2015 which aims at holistic port infrastructure development along the 7,516-km long coastline through modernization, mechanization, and computerization.
- The vision of the Sagarmala Programme is to reduce logistics costs for EXIM (Export-Import) and domestic trade with minimal infrastructure investment.
- Sagarmala could boost India’s merchandise exports to USD 110 billion by 2025 and create an estimated 10 million new jobs (four million in direct employment).
- The Ministry has started the ambitious Project of Sagarmala Seaplane Services (SSPS) with potential airline operators.
Components of the Sagarmala Programme:
- Port Modernization & New Port Development: De-bottlenecking and capacity expansion of existing ports and development of new Greenfield ports.
- Port Connectivity Enhancement: Enhancing the connectivity of the ports to the hinterland, optimizing cost and time of cargo movement through multi-modal logistics solutions including domestic waterways (inland water transport and coastal shipping).
- Port-linked Industrialization: Developing port-proximate industrial clusters and Coastal Economic Zones to reduce logistics cost and time of EXIM and domestic cargo.Coastal Community Development: Promoting sustainable development of coastal communities through skill development & livelihood generation activities, fisheries development, coastal tourism etc.
- Coastal Shipping & Inland Waterways Transport: Impetus to move cargo through the sustainable and environment-friendly coastal and inland waterways mode.
Institutional Framework of the Program:
The program was created with platforms for collaboration between federal, state, and municipal authorities and was intended to be executed along the lines of cooperative federalism.
The Public-Private Partnership (PPP) approach is primarily used to carry out projects.
The National Sagarmala Apex Committee:
- It is chaired by the Union Minister of Shipping.
- It also comprises Cabinet Ministers from other ministries with stakes in the program and the Chief Ministers or Ports’ Ministers of the maritime states.
Sagarmala Coordination and Steering Committee:
- It is chaired by the Cabinet Secretary.
- It also comprises stakeholder ministries’ Secretaries and the maritime states’ Chief Secretaries.
State Sagarmala Committee:
- These are chaired by the respective state’s CM or the Minister of Ports.
Sagarmala Development Company:
- Sagarmala Development Company (SDC), which was set up under the Companies Act, 2013, comes under the administrative control of the Ministry of Shipping.
- It provides equity support to the project Special Purpose Vehicles (SPVs) and funding support for the residual projects under the Sagarmala Programme.
- The SDC would identify port-led development projects and assist project SPVs in project development and structuring activities, bidding out projects for private sector participation, putting suitable risk management measures in place for strategic projects, cutting across multiple states/regions, and obtaining requisite approvals and clearances.
Why is port-led development crucial for India?
- India has a vast coastline of more than 7,500 kilometers and is situated along important global trade routes in the Indian Ocean.
- However, capacity issues and a lack of modern facilities at Indian ports significantly extend the time it takes to carry products into and out of the nation, which has limited India’s contribution to global commerce.
Creating inland canals out of rivers can also reduce domestic logistical expenses. - By 2025, Sagarmala may increase India’s exports of goods to $110 billion and provide an estimated 10 million new jobs (four million in direct employment).
- The Sagarmala Project will enable India to improve its game in terms of commerce, logistics, and port development.
- The Sagarmala Project will assist in establishing a network of roads, trains, and waterways. It will ultimately drive down the cost of various goods since water transportation is 5%–6% less expensive than other means of transportation. Additionally, it will contribute to an increase in India’s GDP.
- The Sagarmala Pariyojna can provide more than a million people with assistance and full-time employment near ports and beaches.
- The initiative will make it easier for those who live close to ports to make a good income. The funding will aid in the development of rural communities close to ports or beaches. Additionally, more accessible transport choices will boost tourism at these important locations.
- Enhanced port connectivity and infrastructure will increase marine security. Furthermore, China’s Maritime Silk Road makes it strategically important. China has enduring difficulties. India must thus have a hold and a link between ports that can permanently fix such problems.
- Having inland waterways will help encourage domestic logistics cost reductions. Overall transportation expenses will go down as a result.
- The turnaround time taken is about 4 days, which is about 2 days at the global level. Hence, the Sagarmala Project is a game-changer in the field of logistics as it cuts down the turnaround time and costs related to it.
- Apart from the turnaround time, the last mile connectivity is also an issue, as it is necessary to ensure the easy movement of cargo, which will eventually lead to economic growth and increased productivity.
- The participation of inland waterways cargo is reduced as it counts up to only 6%, which is much less than other countries like China, the USA, etc.
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