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Saturday, 2 April 2016

Sagar mala Project - A Port led development program

The Sagar mala Project
  
About the Sagar mala Project : The Sagar Mala project is a strategic and customer-oriented initiative of the Government of India to modernize India's Ports so that port-led development can be augmented and coastlines can be developed to contribute in India's growth. It looks towards "transforming the existing Ports into modern world class Ports and integrate the development of the Ports, the Industrial clusters and hinterland and efficient evacuation systems through road, rail, inland and coastal waterways resulting in Ports becoming the drivers of economic activity in coastal areas.


Proposed Investment :  The Union Minister of Shipping on 5 October 2015 said, "The project includes modernization of our ports and islands, setting up of coastal economic zones, new major ports and fish harbors. We expect that the total investment in the project would be to the tune of ₹70000 crore (US$10 billion)."

This plan envisages
1.      Port Modernization includes
a.      Port capacity augmentation 
b.      Major ports Operational efficiency improvement and
c.      Development of Six megaports namely
West Bengal , Sagar Island 
Tamil Nadu     Colachel
Maharashtra   Wadhwan
Karnataka        Tadadi
  


1.      Port connectivity Improvement including
a.      establishment of Indian Port Rail Corporation &
b.      Origin destination Study for Key cargo Types including initiatives for traffic scenario for 5 10 & 20 years being developed
c.       initiatives of coastal shipments

2.      Port-led Industrial development  - Key initiatives to develop
a.      Port based smart cities
b.      Port led Industrial development
c.       CEZs Coatal economic Zone

3.      Coastal Community development - Skill development, Light house tourism development and Fisheries development planned





Let us also look at a few success stories in Port led development programs in other countries

Many countries with long coastlines have leveraged ports for supporting industrial growth. Some examples of success stories are

1      The refinery and petrochemical complex in Rotterdam
a.      5 oil refineries in the port of Rotterdam form the core of the petrochemical cluster in the port area. The oil refineries manufacture products such as gasoline, diesel, kerosene, heating oil and feedstock for the chemical industry. The refineries in the port have a combined distillation capacity of 58 million tonnes. In the Netherlands, Belgium and Germany another five refineries are supplied with crude oil via pipelines from the port of Rotterdam.
b.      Ideal location for crude oil supply  - The oil refineries in the port of Rotterdam receive their crude oil by tanker from areas including the North Sea region, Russia and the Middle East. The port of Rotterdam offers the advantage that even the largest oil tankers can enter the port and load and unload at the oil terminals in a single visit. The crude oil is transported by pipeline to the refineries in Rotterdam and the hinterland.
c.       Cluster with Vlissingen, Antwerp and Germany - The petrochemical cluster in Rotterdam is not isolated. Together with the refineries of Total/Lukoil in Vlissingen, Shell in Godorf, BP/Rosneft in Gelsenkirchen and Total and ExxonMobil in Antwerp, the port of Rotterdam makes up one of the three largest fuel hubs in the world. Excellent distribution possibilities within Europe and overseas and the broad range of tank storage ensure that also large-scale trade in fuels takes place in Rotterdam.
d.      Production of fuels and chemical feedstock - The refineries process the crude oil into various products. Around 85 per cent of the output consists of fuels such as diesel, gasoline, gas oil, heating oil and LPG for the European market or global trade. The other 15 per cent is naphtha, base oils and bitumen. The naphtha is converted into aromatics or alkene and then serves as feedstock for the chemical industry. The oils are processed into lubricants, while bitumen is a raw material for products such as asphalt.

2. The steel cluster in Pohang  

Pohang was a small coastal city with a population of 50,000.  The next major development in Pohang's growth came in 1968 with the inauguration of the steel maker POSCO, and the local plant's commencement of production in 1972. The introduction of heavy industry to the city brought the local economy to a blend of iron, steel, shipbuilding and fisheries through the end of the 20th century.   Posco  based in the port city of Pohang — is world's most efficient steel producer'. Analysts believe Posco can do a Samsung in steel. Its innovative Finex smelting technology uses low cost iron ore and coal to bypass costly coke and sintering processes.

3.      The electronics manufacturing cluster in Shenzhen.  




The Electronics Manufacturing Services industry has developed a number of meaningful clusters in Shenzhen. These Electronics manufacturing clusters developed like a rolling snowball and vitalized regional economies while defining manufacturing trends for many years. The geographic concentrations of interconnected companies, specialized suppliers, service providers, and associated institutions tend to form from one or more catalysts and evolve to take on a life of their own. Clusters tend to arise because the clustering effect serves to increase productivity and lower costs, providing a microcosm of competitive advantage. The largest manufacturers in China namelu Huawei and Foxconn have their manufacturing base in Shenzhen. 

The author is a Shipping & logistics professional and can be reached on


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