1

Sea Ports in Gujarat

By

Divyang K. Chhaya

Besant Nager Sea Beach at Channai

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Sea Ports in Gujarat

Research Notes

by

Divyang K. Chhaya

Photograph by Mrs. Mitakshi Dhebar (Europe)

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Infrastructure Development in Sea Ports in Gujarat

Two decades of brief description from late 1980s

Divyang K. Chhaya

Author is a practicing lawyer enrolled with Bar Council of Delhi in 1982. B.A. 1979 Zakir Husain College, Delhi, LL.B. 1982 Law Center II, New Delhi

LLM 1989 University of Georgia, Athens, GA. USA

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INDEX

Sea Ports in Gujarat

Infrastructure Development: Sea Ports in Gujarat

Geographical Limitations

Implementing International Standards

Port Policy of 1995

Developmental Estimations

Private Investments in Existing Ports

Container Ports Earlier Modernized

Ports for Private Sector Investment

Captive Jetties for Industries

Barge Mounted Power Ports

Infrastructure Development in Maharashtra State

Port Related Infrastructure Development [Gujarat]

External Assistance for Ennore & Paradeep Ports

Cargo Delivery Systems

Turnover of Indian Shipping Companies

Ship Breaking Facilities

Shipping Industry

Port Development in Maharashtra State

Mangalore Port

Goa Port

Chennai Port Trust

Bilateral Trade Ties Affecting Port Traffic

Trade with Brazil

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Sea Ports in Gujarat Infrastructure Development: Sea Ports in Gujarat ANCIENT SEA PORTS There were total 171 Ports in Coastal India as on 1987, out of which 10 were major, 21 medium ports/intermediate Ports and 140 Small Ports. Until 1987, Gujarat had 1 Major Port, 11 Intermediate Ports, and 28 Small Ports. Diu and Daman Ports are in Gujarat although they were under the administration of Goa. Management of all Major Ports is done by Government of India, whereas the intermediate and small ports are managed by the Coastal States. [Port Transport Statistics 1981-82, pg. 3 & 5]. The Ports in Gujarat are nearest to the hinterland States namely: Dadra Nagar Haveli, M.P., U.P., H.P., Haryana, J & K, and Delhi. These States are spread in more than 10 lakhs square kilometers and had population exceeding 18,00,00,000 [as on 1987]1.

Gujarat Ports are well connected with air links, railways, and roadways. In 1983 -84 total exports affected through all the Ports in India was 1020 lakh tones. In 1984-84 and 1985-86, the total export traffic was 1060 and 1200 lakh tones respectively. Share of Gujarat Ports including Kandla Port in 1985-86 was 192 lakh tones.

During 1981-82 total State wise traffic of intermediate and small Ports was as under:

Ports in Coastal India as on 1987

Coastal State Total Traffic Coastal Length No. of Ports

[lakh tones] [Kms] [in 1987]

Gujarat 29.88 1600 40 Maharashtra 12.09 510 43 Goa 00.19 --- 7 Karnataka 8.61 280 21 Kerala 2.50 575 13 Tamil Nadu 2.50 990 13 Pondicherry 1.01 --- 1 Andhra Pradesh 11.14 960 8 Orissa ------ 430 4 West Bengal -- --- ---- 2 Andamans,2 Lakshadweep, etc. 2.15 ----- 19 _____________________________________________________________________ TOTAL 70.07 5345 171 _____________________________________________________________________

1 Population in India as on March 1991 was 843,930,861. There were 929 females per 1000 males in 1991 as against 934 females per 1000 males in 1981. In 1991 Uttar Pradesh had 13.9 Crore people. Total Population of Bihar 8.6 Crores, Maharashtra 7.8 Crores, Greater Mumbai 1.25 Crores, Calcutta 1.08 Crores. The National average of density of population was 267 persons per Sq. Km. in 1991. In West Bengal this density was 766 persons per Sq. Kms., Kerala 747 persons per Sq. Km. India Literacy was 43.56% in 1981, which increased to 52.11% by 1991. In Kerala the Literacy rate was 90.50% in 1991 and 38.54%, the lowest in Bihar. Whereas Chandigarh had a literacy rate of 78.73% in 1991. Birth rate had decreased from 36 per 1000 in 1981 to 29.9 per 1000 in 1991. As per 2001 Census, the Parsi Population in the country was 69,601 (33,949 Males and 35,652 Females) as against their population of 76,382 (37,736 Males and 38,646 Females) in the 1991 Census. See: Parsi Population on the decline, Times News Network, The Times of India, New Delhi, India, Tuesday September 7, 2004. pg. 13. 2 Article 240 of the Constitution of India deals with the powers of the President of India to make regulations for the Peace, Progress, and good government of the Union Territory of the Andaman & Nicobar Islands (substituted by the Constitution (7th Amendment) Act, 1956). It is the territory, which immediately before the commencement of the Constitution of India was comprised in the Chief Commissioners province (See Schedule -1, List ii, Entry 2 of the Constitution of India. The Archipelago of Andaman & Nicobar (Kalapani) is spread across 780 Kms of Ocean in the Bay of Bengal between 60 and 140 North Latitude, and 920 and 940 East Longitude totaling to 554 Islands, which include surfacing Rocks, etc. A total of 298 Islands exist in the real sense of which only 36 Islands are inhabited. These are sunken chain of Mountain Range between Burma and Indonesia. Important Islands in the Nicobar District are Car Nicobar, Chowra, Teressa, Bompoka, Katchal, Kamorta, Nancowry, Trinket, Kondul, Pulomilo, Great Nicobar, Tillangchong, etc. Highest Peak 642 Meters high Mount Thuliar is in Great Nicobar among its deep ravines. Nicobarese welcome Iwika, the good spirits. They live a care free life full of wide ranging amusements as in Hesperides. For further details on these Islands, see the End Notes.

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Gujarat has been an important trade centre from ancient times. Astronomer Toemy had referred to Ports at Bharuch, Mangrol, and Porbandar as Barigaza, Manglosan, and Bordecxima [Bombay Gazette, Vol: I, Part: I]. Because of its geographical location trade with Africa, Gulf and Europe was convenient for the navigators.

When the Railway facilities did not exist in the olden days, any point situated on a river developed as an important trading point [Port]. Inland water transportation was used in handling incoming and outbound cargo. On such points/ports in Gujarat, normally ships ranging from 5 tones to 500 tones used to anchor and trade with places connected with river, Those days heavier ships were not exceeding 2000 tones.

In 1850, after the railway and steamer age, it was not only the ports, which were the trading centers but other infrastructure had developed by then. Because of lack of monitoring and heavy duties on internationally traded commodities, the ports in Gujarat also started being misused by unscrupulous businessmen/traders who started bringing into India the goods without paying the duties thereon.

Some of the ports that were active in 1850 or prior thereto witnessed natural death due to siltation like the Ports in Khambhat, Surat, Dholera, Somnath, etc.

Mainly there are 3 kinds of Ports in Gujarat:

[i] Natural and Protected Port,

[ii] Artificially Created due to breakwater and protected Port, and

[iii] Assurian Ports, which are situated on a merger point of a river and sea.

The Natural and protected Ports are Pipavav, Okha, Sikka. There are 16 Ports from Okha to Bedi, which are protected by the reef. Sialboat and Simayani are also the Ports falling in the above category. The Artificial breakwater Protected Ports are Veraval, Mangrol, Mandvi, and Jafrabad.

Assurian Port Sites are at Bhavnagar, Surat, Bharuch, Valsad, etc. which are situated on the Sea-River intersection. Out of abovementioned 171 Ports, the Ports in actual use until the advent 1900 AD were only 120.

Out of these 120 Ports, the Government of Gujarat is having facilities only in 41 Ports. And, these facilities also are not adequate to meet with the demands of the day in 1997.

The Sea water had caved in at Kandla and Navlakhi, and hence are very all weather protected ports. The Ports where traffic exceeds 10 lakh tones per year are called major ports, the Ports where the traffic exceeds 1 lakh tones but is below 10 lakh tones per year are called intermediate ports, and the Ports where the traffic is below 1 lakh tones per year are called small ports.

Kandla is a Major Port and has a recorded traffic exceeding 140 lakh tones per year [1986], and import traffic exceeds 6 lakh tones as of 1987. Food grains, fertilizer, coal, crude oil, etc are imported from Kandla, and Salt, Stainless Steel Utensils, Wool, ready made garments, iron ore, and scrap etc. are exported from Kandla Port.

Mandvi, Navlakhi, Bedi, Sikka, Okha, Porbandar, Veraval, Jafrabad, Bhavnagar, Bharuch, and Surat are Intermediate Ports.

As of 1986-87, a traffic of 10 lakh tones was routed through Bedi, and 4 to 6 lakh tones jointly through Navlakhi, Bhavnagar, Magdalla, and Jafrabad Ports, and 2 to 3 tones traffic was routed through Okha, Sikka, Porbandar, and Veraval.

In 1986-87 the Mandvi Port witnessed traffic of 30,000 to 50,000 tones, whereas traffic in 1987 was nil from Bharuch Port. Magdalla Port was activated for cement cargo for Narmada Project, where cement was sent from Jafrabad Port. The Jafrabad Port is also a fishing Port site. Pipavav Port in 1987 had traffic of 50,000 tones. Lighters/Barges not exceeding 500 tones anchor on the jetty at Jafrabad and Magdalla Ports.

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Whereas, Bhavnagar, Sikka, and Okha are the direct berthing facilities Ports, so the Steamers anchor directly touching the jetty. These Ships were also not exceeding 50 tones as of 1987. These three ports are protected from sea associated natural calamities.

All-weather ports with direct berthing facilities are Navlakhi, Bedi, Salaya, and Porbandar [total 7 Ports] need many improvements.

These 7 Ports are operative for more than 300 days in a year because the monsoon period is short. The Ports that are totally closed during monsoon period are: Koteshwar, Mundra, Jakho [Jilla Kutch], Jodia, Pindara, Beyt, Rupen [Jilla Jamnagar], Pipavav, Jafrabad [Jilla Amreli], Mahuva, Talaja, Ghogha [Jilla Bhavnagar], Duhej3, Bharuch [Jilla Bharuch], Bhagvi, Onjal, Billimora, Vansi-Borsi, Surat, Valsad, Umarsadi, Kolak, Maroli, and Umergaon [Jilla Surat & Valsad].

These are called Fair Weather Ports.

These are not the Ports with direct berthing facilities, hence, the Steamer/Ship has to be anchored in deep waters far from the jetty on the shore, and self propelled Lighter or Barges or Tugs are needed for loading and unloading operations.

The Lighters/Barges/Tugs are also operative in the Ports having direct berthing facilities.

Except for Pipavav, all Ports in Gujarat are threatened by siltation. In olden days Khambhat, Kavi, and Surat etc and in the present times Porbandar, Bedi, Veraval, Mahuva, Okha, and Bhavnagar Ports face siltation problems of differing magnitudes. Old Port of Bhavnagar has died due to siltation from Narmada waters, and lack of River Flushing during monsoon floods. Siltation is less near the concrete jetty at these places.

Siltation problem spreads until Lakshadweep Islands, and Maldweep Islands. After the Dam is built on Narmada River, the siltation will be arrested to a greater extent. Rock Dredging has become essential to remove rocks in and around the Ports at Veraval, Mahuva, Mangrol, Porbandar, Bedi, and Okha.

In 1984-85, only 25 Ports in Gujarat witnessed traffic whereas there was no traffic in 14 other ports. There was NIL traffic in Ports at Maroli, Bhagva, Onjal, Bharuch, Koteshwar, Mangrol, Madhwad, Kotda, Rajpura, Khambhat, Pindara, and Beyt.

In 1985-86, there was no traffic in Jakho and Vansi-Borsi, but Kotda exported only 45 tones of goods. This way 13 Ports have NIL traffic w.e.f. 1986.

Mangrol, Veraval, and Porbandar are Fishing Ports also. If Ferry Service starts from Dahej - Ghogha Ports, these are likely to be developed. Bhavnagar, Dahej, and Hazira, are Ports situated between Kandla and Mumbai.

These Ports are suitable to industrial export/import to cater to the needs of industries situated between Vadodara and Umargaon, and Madhya Pradesh.

Before independence, the goods imported into India were mainly: Sugar, Construction Wood, Timber, Matchbox, Cutlery, Cloth, Medicines, Chemicals, etc, and the goods that were being exported were Ghee, food Grains, Oil Seeds, Stone, Onions, and Cotton etc.

In 1968-69 export import traffic was 37 lakh tones as against 20 lakh tones recorded earlier.

In 1984-85 total import traffic handled by Indian Ports were 30.34 lakh tones and exports 17.73 lakh tones.

3 Petronet LNG is first in India to develop LNG import terminal at Dahej. France has conferred its second civilian honour, Knight of the Order of Merit, on the CEO of Petronet LNG Suresh Mathur in recognition of his leadership and professional acumen. The award was given by Ambassador of France in India, His Excellency Honble Dominique Girard. Petronet LNG has built a 5 million tones per annum capacity LNG import and regassification terminal at Dahej. Liquefied Natural Gas is purchased from RasGas of Qatar, and is sold to Indian Oil Corporation, Bharat Petroleum. The Gas is purchased @ $ 2.53 per million British thermal units (mBtu) whereas the same sells internationally at $ 5 per mBtu or even more. Both ONGC and GAIL hold 12.5% equity in Petronet LNG. Gaz de France, the Project Consultant, holds 10% equity therein. See: Large Enterprises & Infrastructure, TOI, New Delhi, Friday October 8, 2004, at page 10.

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Total traffic in 1985 was 34.17 lakh tones and in 1986 total import/export traffic was 17.12 lakh tones. Traffic as 1987 from different Ports in Gujarat was as follows:

Ports Traffic exceeding

Bedi 10 lakh tones

Navlakhi, Bhavnagar 5 lakh tones

Magdalla, Veraval, Jafrabad

Sikka, Porbandar 4 lakh tones

Dahej 1 lakh tones

Okha 2 lakh tones

Mandvi 50,000 tones

Pipavav 40,000 tones

Mundra, Mahuva 10,000 tones

Ghogha, Valsad 3000 tones

Navibundar 1000 tones

Jodia, Salaya, Rupen,

Vansi-Borsi, Billimora {below 100 M T}

Umar Sadi, Kolak

Import items stabilized until 1986 were food grains, fertilizers, rock phosphate, wood pulp, phosphorous, coal, machinery, fuel, oils, petroleum, dates, Palmolive, beetle nuts, cooking masala, construction materials, cotton, jute bags, construction timber, and wood.

Items of exports were Coconut, nuts pulp, peanuts, oil, castor oil, bentonite, lime stone slabs, chalk, rice, marble, machinery, cotton, fish, wool, chemicals, guar gum, mehandi, dolomite powder, chirodi, garlic, onions, cattle feed, fruits, vegetables, etc. Salt used to be sent to Japan, and South Korea to the extent of 5 lakh tones, now the Indian salt is being exported to many countries. Cotton imports were totally stopped by 1990. Fish exports were affected from Jafrabad, Veraval, Porbandar, and Mangrol Ports in Gujarat. Bhavnagar and Ghogha Ports has Tug, Barge, and traditional Boat Building facilities/yard. Veraval has automatic Fishing Boat Building Yard. Porbandar Port handled container services until 1987.

Presently the container Ports are earmarked by the Government of Gujarat and development concordant therewith is being planned and done as per the priorities declared by the Government and the Gujarat Maritime Board. Pipavav, Kandla, Salaya, and Vadinar are all good locations for container traffic. As per Traffic Review, 1980-81 to 1985-86, pages 3 to 8 the traffic was as follows during the above years:

Years Import [tones] Export [tones] Total

1980-81 14,93,428 12 ,87,610 27,80,038

1981-82 17,11,310 12,77,290 29,88,600

1982-83 14,60,749 7,31,363 31,82,112

1983-84 26,94,791 15,20,951 42,20,742

1984-85 30,34,756 17,73,062 48,07,818

1985-86 34,16,641 17,11,915 51,28,556

90% of the above traffic was from following Ports in Gujarat State:

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Port Import [tone] Export [tone] Total

Mandvi 67,264 17,926 85,190

Navlakhi 4,85,757 21,428 5,07,185

Bedi 6,54,617 4,48,721 11,03,338

Sikka 64 1,45,864 1,45,929

Okha 1,93,214 53,476 2,46,690

Porbandar 6,900 1,82,369 1,89,269

Veraval 3,60,302 91,912 4,52,214

Bhavnagar 4,51,909 72,975 5,24,884

Magdalla 4,51,919 ______ 4,51,919

Jafrabad 316 6,59,659 6,60,025

Pipavav 835 48,404 49,239

Total traffic of Salaya was 698 tones during 1984-85, and in Bharuch, it was NIL. The then new port in 1984-85 in Dahej witnessed traffic of 100066 tones. During this period Kutch, Saurashtra, and important ports in Gujarat witnessed 99187 tones, [i.e., 2%], 41,50,000 tones [92.4%], and 558631 tones [5.6%] respectively.

During the same period, Bedi had traffic of container cargo through leash ships/steamers to the tune of 17591 tones, and Reefer Cargo was 5294 tones at Veraval & Porbandar. These two Ports saw fish exports of 3207 and 1592 tones respectively in 1984-85. Gujarat Ports deals with many countries on regular basis. Lack of roads and related infrastructure facilities are to be blamed for lesser foreign going traffic from Gujarat Ports. 1983-84 & 1984-85 saw imports of Ships for breaking at Alang and Sachana Ports to the tune of 2.88 and 2.54 lakh tone steamers.

In 1985-86, steamers exceeding 5 lakh tones were imported for breaking:

Year Foreign Trade Coastal Trade

[lakh tones] [lakh tones]

1980-81 21.93 5.97

1981-82 23.18 6.70

1982-83 24.69 7.13

1983-84 31.13 11.02

1984-85 32.95 15.14

1985 36.08 15.21

1980-81 to 1985-86, the traffic through steamer and ships was as follows:

Year Steamer Traffic No. of Ships Traffic

lakh tones lakh tones

1980-81 448 25.32 12494 2.72

1981-82 443 27.58 11510 2.30

1982-83 612 30.13 10141 1.69

1983-84 1097 40.60 8451 1.56

1984-85 1678 46.24 7712 1.74

1985-86 ___ 49.70 ___ 1.58

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Many intermediate and small ports in Gujarat already had [prior to 1984] facilities of jetty and wharfs, whereas Okha, and Pindara had Mooring facilities.

In large Ports facilities of Tug, Barge, Launch, etc were existing since past many decades.

Okha has Dry Dock. Pilot services are essential at Okha and Bhavnagar.

Adequate space has been reserved for creating Warehousing facilities. Government has Dredging facilities.

In Dry Dock Ports like Bhavnagar, Okha, Sikka, etc, Ships anchor on the jetty of 30 feet Drafts.

Ports have facilities of labour and automation of cranes, conveyor belts, etc.

Lighthouses, water, electricity, telephone, telegraph4 office, post office, etc infrastructure facilities are available at these Ports.

The labour force at Ports in Gujarat is duty conscious and honest and is found to be far better than that of other States.

Management of Ports is under the Gujarat Maritime Board w.e.f. April 5th 1982.

Earlier management of the Ports was being handled by the Secretary/Director Ports.

As per Traffic Review Appendix 2, 1984-85, Page 19, and Traffic Review 1985-86, Page 20, all Ports in Gujarat are spread in 9 major coastal locations, namely, Mandvi, Navlakhi, Bedi, Okha, Porbandar, Veraval, Bhavnagar, Mahuva, and Bharuch.

There is separate Port Development Officer for Magdalla and Jafrabad.

All Ports are mainly distributed in 4 Circles, and 10 Divisions under 4 Circles, and 1 Sub-division.

Details of above Port Distribution are as follows:

Port Group Ports under the Group

Mandvi Mandvi, Mundra, Jakho, Koteshwar

Navlakhi Navlakhi

Bedi Bedi, Sikka, Salaya, Jodia, Pindara

Okha Okha, Beyt, Dwarka, Rupen

Porbandar Porbandar

Veraval Veraval, Mangrol, Kotda, Navibundar, Madhwad

Bhavnagar Bhavnagar, Talaja, Ghogha

Mahuva Mahuva, Jafrabad, Pipavav, Rajpara

Bharuch Bharuch, Surat [Magdalla], Vansi-Borsi, Kolak, Maroli, Umargoan, Khambhat, Dahej, Bhagva, Onjal, and Billimora

Traffic is almost NIL at Jakho, Koteshwar, Pindara, Beyt, Mangrol, Madhwad, Ghogha, Rajpara, Maroli, Khambhat, Bhagva, and Onjal.

The Ports earn by levying wharfage, Barge charges, Tug, Crane, and lighterage charge, and Rental of land leased for godowns.

Earlier there used to be separate funds for Port Development, Port Revenue, and Port Depreciation.

4 Under the Constitution of India Post & Telegraph, telephones, wireless broadcasting and other like forms of communications is the subject of legislation for the Union of India as found in Schedule VII, Entry 31, List 1.

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Earnings of Ports from 1980 to 1886 are as follows:

Year Income in Rs. lakhs Expenditure in Rs. Lakhs

1980-81 615.17 839.54

1981-82 841.47 867.22

1983-84 1161.80 957.57

1984-85 2038.35 1718.29

1985-86 2075.99 _____

After formation of the Gujarat Maritime Board, the Ports income had increased. Ports at Bedi, Bhavnagar, Okha, Navlakhi, and Veraval earned an amount exceeding Rs.100 lakhs in 1983-84.

And, Bhavnagar & Bedi combined are showing earnings exceeding Rs. 100 lakhs since past many, many years [1985 to 1987].

Ports in Gujarat are strategically better located than ports in Tuticorin, and Mangalore etc. In the Seventh Five Year Plan Rs 6000 lakh were earmarked for Ports in Gujarat.

As per IDBI, Industry & Finance, News Digest, Vol. 12, No: 8 1995 {Market Research Department}, Page 21, Infrastructure, Development of Ports, Proposals of Private Projects worth Rs 13,630 Crore for the development of ports in the Country, have been received by the Central Government.

All investments done by the Government of India in these ventures are subject to jurisdiction of the courts in India.5

The Ports for which the proposals reported to have been received are Kandla, Jawaharlal Nehru Port Trust, Bombay, Mormugao, New Mangalore, Cochin, Tuticorin, Madras, Vizag, Paradweep, and Calcutta. Project proposals worth Rs. 6,450 Crore were received by 1997 from private sector for the JNPT and proposals worth Rs. 1,580 Crore for Paradweep Port.

While coal jetties are already being developed by the private parties at Tuticorin, Ennore, Paradweep, and New Mangalore, LPG jetties, and storage facilities are coming up at Kandla6, JNPT, Vizag, Cochin, Haldia, and Tuticorin. Under the process of privatization, container terminals are also being built at Cochin, Goa, Vizag, Haldia, Calcutta, Tuticorin, New Mangalore, Kandla, and JNPT.

In addition, privatization of berths has already been undertaken at Mumbai and Chennai.

The Principal Ports in India are:

Port State

Alleppey Kerala

Bhavnagar Port Gujarat

Calcutta West Bengal

Cochin (Kochi) Kerala

5 Constitution & Jurisdiction of Supreme Court is provided for in Entry 77, List 1 related to any matter Entry 95, List 1 jurisdiction of all courts other than SC relating to any matter in List 1 Entry 65, List II jurisdiction of all courts other than SC relating to any matter in List II Entry 5, List III jurisdiction of all courts other than Supreme Court relating to any matter in List III. Entry 78 List 1 Constitution of High Court Entry II A, List III All courts except SC & HC (Special Courts in Re: AIR 1979 SC 478 (para 44): (1979) 1 SCC 380: 1979 (2) SCR 476. In most cases Arbitration is a preferred mode of adjudication of arbitrable claims and for various types of claims that are defined by the interactors as non-arbitrable the courts in India have the jurisdiction to entertain the issues. 6 Indian Oils Rs. 73 Crore Pipeline projects linked to the expansion of Panipat refinery converts the existing Kandla-Panipat section 1,443 Kms Kandla-Bhatinda Product Pipeline for transporting crude oil. Panipat refinery is being expanded to process 12 million tones of crude each year from existing six million tones. The installation is controlled through Supervisory Control and Data Acquisition System (SCADA). TOI, New Delhi, Friday, October 08, 2004, page 10.

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Dhanushkodi Tamil Nadu

Chennai Tamil Nadu

Paradweep Orissa

Surat Port Gujarat

Vishakhapatnam Andhra Pradesh

Porbandar Port Gujarat

Haldia West Bengal

Bhatkal Karnataka

Mumbai Port Maharashtra

Calicut Tamil Nadu

Cuddalor Tamil Nadu

Kandla Gujarat

Mangalore Karnataka

Quilon Kerala

Tuticorin Tamil Nadu

Marmagoa Goa

Kozikode Kerala

Port Blair Andamans

1.00 The Gujarat Port Policy is an integrated approach, covering port development, industrial development, power generation, and infrastructure development.

1.01 Gujarat Maritime Board will act as a coordinating agency in procuring land, water, power, and infrastructure facilities like rail, road, and any other clearances to be obtained from the Government of Gujarat/India.

A High level committee headed by the Chief Secretary, Gujarat State, will monitor the implementation of the integrated approach and report to the Infrastructure Development Board, and the Cabinet on the progress of the implementation of the Port Policy.

1.02 The facts herein are recorded from the Government publication Port Policy 1995, issued by the Ports & Fisheries7 Department, Government of Gujarat, India, and recent facts are recorded from the news paper announcements by concerned State or Central Government Department.

1.03 Gujarat State has 1600 Kms long coast line (about 1/3 of Indian coastline). Gujarat is the nearest Maritime outlet to the Middle East, Africa, and Europe.

1.04 Relaxation of duties and changes in the Port Policy was a result of raise in Exports by 24%. Mega Industrial Companies and multinationals have shown keen interest in investments in Gujarat State. Investments of about U.S. $ 30 billion were already committed by 1997 to various projects in the State.

7 Fisheries is an exclusive State subject under Entry 21 of List II. (The State List under the Constitution of India) Fisheries beyond territorial waters of India is an exclusive Union subject under Entry 57 of List I. Regulation and development of inter-State rivers and river valleys to the extent to which such regulation and development under the control of the Union is declared by the Parliament of India by law to be expedient in the public interest. (Cauvery Water Dispute, AIR 1992 SC 522 (paras 7, 11): 1983 Supp. (1) SCC 96 (2). Under Entries 14, 17 and 18 of List II, (Article 246) the State Legislature has competence to legislate with respect to all water within its territory. But inter-State rivers flowing through the State remains subject to Entry 56 of List 1 in the Constitution of India.

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1.05 By 1997, investments of over Rs 16,000 Crore were done at Hazira. Rs. 15,000 Crore were planned for Vagra, and Rs. 20,000 Crore for the development in and around Pipavav & near Jamnagar Port Sites. Large Corporations would always want to import raw materials by accessing the International market through Sea routes, which is definitely more viable and feasible as against the surface transport or air transport.

1.06 35% of total Indian Exports are from Rajasthan, Madhya Pradesh, Punjab, Haryana, J & K, and Himachal Pradesh, Western Uttar Pradesh and Delhi. These are likely to be the potential customers of Ports in Gujarat. Existing Ports are too congested for type specific need of the exporters.

Economic progress of these States have direct effect on Ports traffic in Gujarat [South is too far, and rest of the Major Ports8 in India are too congested]. 197 Million Tones cargo was handled by Indian Ports in 1994-95.

The tonnage is on increase in recent years. Efficiency of a Port and the sea bound cargo activity, in terms of ship turnaround time, waiting time and average ship per day output, has a significant influence on the development scenario.

1.07 The existing ports for the past few years are under a great work pressure to cater to ever increasing cargo traffic, resulting into demurrages and massive loss of foreign exchange [in terms of delayed shipments etc.].

1.08 The international ship size and design have changed, and in1997 it has become essential to make suitable structural changes in the existing ports to accommodate and berth these super size ships. The modern ports need to be integrated with inter-modal cargo, coordinated sea vessels, and hinterland9 vehicle rail/road/air transport timings.

1.09 The proposed locations of new ports to be developed by Government of Gujarat/Private Parties in Joint Venture through Gujarat Maritime Board, are all port sites that are suited to adapt itself to current technology10 development with respect to telecom, automation, cargo handling, and ship technology.

This change needs drastic conversion of physical layout of ports as well as material handling equipment and other mechanized or robotic gear, modernization & changes are also needed in operations and management.

Therefore, the developmental aspects of new ports must take into account 50 years of times ahead of 1997 to incorporate future need of the port sites in India as shall have to coincide with the International demands of the latest technology.

1.10 Presently, there are 41 Ports in Gujarat. Kandla is a Major developed port. Of the remaining 40 Ports, 1l ports are intermediate ports and 29 are minor ports. All Minor Ports are under the control and management of Gujarat Maritime Board [GMB].

1.11 All weather Ports are Porbandar, Okha, and Sikka, having all weather direct berthing facilities. Seven Ports are all weather lighterage Ports, the remaining thirty ports are fair weather lighterage ports for sailing vessels and fishing boats.

1.12 The Minor and Intermediate Ports of Gujarat handle about 8.5% of national shipping cargo. Nevertheless, Ports in Gujarat handle 16 Million Tonnes of Cargo, which accounts for 70% of cargo handled by all minor ports of India.

8 See Article 364 of the Constitution of India, Schedule VII, List 1, Entry 27 that deals with Major Ports in India. Other Ports are covered by Entry 31 of List III [The Concurrent List where The State & The Union both have the power to legislate on the subject enumerated therein subject to State Law being in conformity with the Union Law (Entry 28 deals with Port Quarantine, Seamens and Marine Hospitals). Article 364 makes special provisions as to Major Ports and Aerodromes. 9 Mountainous ranges are also always in need of exports of agricultural produce, forest produce, etc. The Seven principal Mountain Ranges in India are Himalaya, Vindhaya, Aravali, Eastern Ghat, Patkoi, Satpura, and Sahyadri. 10 Further details from: NCST National Committee on Science & Technology, NGRI National Geophysical Research Institute, and UNESCO United Nations Educational, Scientific & cultural Organization.

14

GEOGRAPHICAL LIMITATIONS 2.00 Drafts of 8 to 10 Meters are available at Porbandar, Okha, and Sikka, where ships ranging from 15,000 to 25,000 DWT11 are directly berthed. Porbandar handles container cargo for fish exports.

The container cargo handling facility does not exist in any other ports. There exists a limited scope for expanding berthing facilities in the existing minor and intermediate ports.

2.01 All that is possible is to enhance handling facilities by modern equipments, which can increase traffic from present 16 million tones to 24 million tonnes.

Because development of existing ports is limited in many respects, hence the Government has identified potential green-field sites on Gujarat coast for development.

2.02 For the coastal based mega cement plants in Gujarat [Kutch and Saurashtra], the utilization of port facilities for cement/clinker exports becomes essential.

Close proximity to Middle East opens up venues for locating petroleum refineries and storage of petroleum products for hinterland consumption.

Export of salt and import of coal are other major important cargo apart from the existing items of import and export.

IMPLEMENTING INTERNATIONAL STANDARDS

3.00 Modernization and technology up-gradation opens up scope for import of industrial raw material and import of finished goods through global market through the ports.

3.01 At present the Government has not declared any plan to create any port of international design and status linked with hinterland States with multi channel infrastructure therewith related, and roads12 that carry cargo efficiently.

3.02 Pipavav Port has direct berthing facility. GMB in joint venture with private sector Company is developing this port. About Rs.260 Crore is likely to be invested in Pipavav Port before the year 2003 AD. PORT POLICY of 1995 4.00 Gujarat Government has declared a New Port Policy 1995, which is as under:

[1] To increase Gujarats share in import and export in National and International trade13 & commerce in pursuance of liberalization and globalization policy.

[2] to decongest the overburden on the existing major ports on Western India to cater to the needs of increasing traffic of western and Northern States14, by providing efficient facilities and services and to support the countrys international and domestic trade15.

[3] To handle 100 million tonnes of cargo in GMB waters accounting to approximately for 25% of Indias total cargo by 2000 AD.

11 d w t: means Dead Weight Tonnage and Cwt means Hundred-weight (112 lbs). 12 Competence of Union of India to legislate with respect to National Highways is found in Schedule VII, Entry 23 of List 1. Competence of State to legislate with respect to roads, etc., is found in Schedule VII, Entry 13, List II of the Constitution of India. 13 Further details from: IUTF - International Union for Trade Fair. 14 Northern Zone Punjab, Haryana, Rajasthan, J & K, Delhi, M.P., U.P., and Chandigarh. Central Zone - M. P., Chhattisgarh. Eastern Zone - Bihar, West Bengal, Orissa, Assam, Nagaland, Manipur, Tripura, Meghalaya. Western Zone - Maharashtra, Gujarat, Goa, Daman & Div, Dadra & Nagar Haveli. Southern Zone - Andhra Pradesh, Tamil Nadu, Kerala, Karnataka, Pondicherry. 15 Further details can be had by studying General Agreement of Tariff & Trade (GATT) now called WTO (World Trade Organization) w.e.f. January 1995.

15

[4] It is estimated that 50% of total industrial investment coming to Gujarat will be Port based. To provide for port facilities to promote export oriented industries16 and port based industries.

[5] To take advantage of strategic location of Gujarats coast in the world maritime scenario:

[A] To encourage ship building, ship repairing, and establish manufacturing facilities for cranes, dredgers and other floating constructs,

[B] To provide facilities for coastal shipping17 of passenger and cargo traffic between Kutch, Saurashtra, and South Gujarat and further extension of these services to important places like Mumbai. Goa etc.

[6] To fulfill future power requirements of Gujarat:

[a] by establishing barge mounted power plants

[b] by providing exclusive port facilities for importing different kinds of power fuels.

[7] To attract private sector investment in the existing minor and the

Intermediate ports and in the new port locations.

4.01 In the integrated port development facility the Government has decided to create Ports or facilities, industrialization and development of infrastructure facilities like roads, railways18, etc. in the State [hinterland]. DEVELOPMENTAL ESTIMATIONS 5.00 Estimated U S $ 3 Billion would be required to create New Port Facilities in India and supporting infrastructure.

5.01 It is intended to develop ports with direct berthing facilities, that can berth international size large ships, and speedy mechanized/robotic handling facilities so as to reduce waiting period of the ships and saving in the cargo expenses.

5.02 To expedite creation of port facilities by 2000 A D; it is proposed to have the participation of private enterprise in development of the port infrastructure.

5.03 GMB has studied and is likely to inventorise the future cargo from the hinterland States as well as in the coordination with the Department of Agriculture, Fertilizers, Petroleum, Steel, and Coal under various Ministries of the Government of India.

The assistance of Director General of Foreign Trade will be sought to coordinate the projected cargo generation on behalf of various departments of the Government of India.

All the time Sea-Links are not required or cost-effective in manufacturing process, etc. For example, Pakistan consumes about 4, 75, 000 tonnes of peraphthalic acid (PTA), a key ingredient for making plastic, but it produces only 4, 00, 000 tonnes annually.

The shortfall of 75,000 tonnes used to be imported from Thailand, etc. to Karachi Port, and re-transported to upcountry consumption centers increasing time & freight costs,

In the AugustSeptember 2004, several Pakistani major users of PTA, the petroleum companies, negotiated the finalization of a deal with IOC, Panipath, for sourcing one lakh tone of PTA. This will mark the beginning of first ever big-time direct trade between the two neighbours.

16 Industries generally belong to the State List, Entry 24 of List II of the Constitution of India subject to the provisions of Entries 7 and 52 of List 1. Ishwari Khetan Sugar Mills (P) Ltd. v. State of U.P., AIR 1980 SC 1955, Paras 6, 23-24: (1980) 4 SCC 136. 17 Competence of Union of India to legislate with respect to Shipping & Navigation by mechanically propelled vehicles on inland waterways declared to be national-waterways is found in Schedule VII, Entry 24 of List 1 of the Constitution of India. 18 Competence of Union of India to legislate with respect to Railways is found in Schedule VII, Entry 22, List 1.

16

Importing of PTA by Pakistan from IOC Refinery at Panipath will save on the freight costs as the Panipath Refinery is geographically close to consumption centers in Pakistan and both locations are well connected with road and rail to facilitate easy movement of PTA from India to Pakistan.

See: Pak May Source PTA from IOC, Tying up a Plastic Knot, by Sanjay Dutta/TNN, reported in Times of India, New Delhi, Monday, September 06, 2004, BUSINESS TIMES at pg. 17.

Karachi Port is this situation is very far from PTA consumption units in Pakistan and sourcing PTA from IOC, Panipath, is easier for Pakistan as compared to its earlier imports from Thailand, etc. to Karachi Port, and re-transport after importation to consumption centers at Islamabad Lahore Faisalabad.

However, use of Sea Routes is the only option where Road Rail Links are not available, or are cumbersome. 6.0 PRIVATE INVESTMENTS IN EXISTING PORTS 1) Incomplete works of Wharf, Jetty, and Quay GMB will be privatized.

2) Private entrepreneurs will be permitted to install modern mechanical handling equipment on the Wharfs/Jetty/Quay.

3) Privatization of construction of new Wharves/Jetties in selected sites.

6.01 The entrepreneurs making investment in Gujarat Ports at the above stated locations will be given ousting priority for a period of 5 years from the date on which it is awarded.

For projects with higher investments, GMB will consider to enhance this period. The entrepreneurs should assure a minimum cargo handling from the said landing places.

Demarcated Port Sites for Privatization in 1995

6.02 The party has to pay full wharfage charges to GMB for cargo undertaken on such structures. The GMB has already identified such sites & activities in the existing minor & intermediate ports.

6.03 The privatization process of these ports/structures began in 1995-96 by open tender bids.

With liberalization of Parallel Marketing of Petroleum Products by Govt. of India, the demand for Port facilities for handling LPG, Kerosene, HSD, other Petroleum Products & Liquid Chemicals have increased.

6.04 Looking to the existing minor & intermediate ports, its available infrastructure facilities are not suitable & adequate to handle such liquid cargo. Now, new port sites, are identified to handle such petroleum/liquid, oil19/chemical cargo.

6.05 Port Sites Demarcated for Development:-

1. DHOLERA (for General Cargo)

Dholera is situated 30 Kms away from Dhandhuka, enroute Ahmedabad to Bhavnagar. Dholera Port is an all weather direct berthing port in Malclon Channel, and can be developed for general cargo. A draft of 10 meters is available within 3 Kms from the off take point on the shore, near village Jaswantpur.

2. MAROLI (for Industrial and General Cargo)

Maroli is a virgin port site in Gujarat, situated on the North of Mumbai, an all weather port with protective structure like breakwater.

The development plan envisages the port facilities in 10 meters depth at 3 Kms from the shore to handle industrial and general cargo.

19 Better particulars can be had from OFF Oil Facility Fund.

17

Major portion thereof is naturally on high bank and shallow waters.

3. VANSI-BORSI (Liquid Chemical Cargo)

Vansi-Borsi port site is identified for liquid chemical cargo, and petroleum. It is suggested to provide adequate matching port facilities in 10 meters depth at 5 Kms from the shore with break water arm. The Vansi - Borsi Port site is 13 Kms from the nearest broad20 gauge railway link at Navsari, and is 30 Kms south of industrial town of Surat.

4. HAZIRA (General & Industrial Cargo)

Hazira Port, Magdalla [Surat], is located on the bank of river Tapi. An existing intermediate port handling general cargo. On the right bank of this river, near Hazira Lighthouse21, Mega Industrial Houses (Reliance, etc) have established their own captive port facilities.

On the western side of these facilities, and near Suvali Point, a deep draft port is suggested.

The berthing facility for industrial cargo will be provided in 15 meters contour at a distance of 3 Kms from the shore.

A protective structure in form of break water will also be necessary.

5. DAHEJ (for Industrial Cargo)

Dahej, 42 Kms from Bharuch, has begun to be developed by private investments. An all weather port is suggested to be developed for large cargo.

Ocean22 going ships at 2 Kms from the shore, where an adequate depth of 18 meters is available.

Alternatively, a lagoon port is also possible with excavation on the land and dredging on the channel for a 10 meter deep harbour.

6. MITHIVIRDI (for Steel & Automobile Exports)

Mithivirdi port site is situated 40 Kms South of Bhavnagar, and 10 Kms north of existing ship breaking yard at Alang. It is suggested to be developed as an all weather port for steel and automobile exports. The Port facility will be provided in deeper elevation of 20 meters available at an approximate distance of 3 Kms from the shore.

7. SIMAR (for LNG, Coal, Fuel for Power Generation)

Simar is 27 Kms South-West of existing Minor Port of Jafrabad, and 90 Kms East of Veraval.

The availability of draft at the location is quite favorable having running of 20 meters contour, at a distance of 1 Km from the shore to accommodate ocean23 going vessels of 1,00,000 DWT.

This Port is suggested for development to handle LNG, Coal, and other fuel requirements for power generation within port area. The port site is naturally protected by Diu Island. Power24 can be evacuated or displaced by Power Grid System catering to the rest of the country.

20 See Reports of BRO Border Road Organization. 21 Under Constitution of India Lighthouses, including lightships, beacons and other provision for the safety of shipping and aircraft is dealt with by Article 246, Schedule VII, Entry 26 in List 1 (The Union List) 22 Main Oceans are The Pacific Ocean which is 181, 000, 000 Sq. Kms in its spread, Atlantic Ocean is 106, 000, 000 Sq. Kms (See relevant Reports of : NATO North Atlantic Treaty Organization), Indian Ocean is 73, 490, 000 Sq. Kms, and Arctic Ocean is 14, 350, 000 Sq. Kms. 23 Major Oceans and Seas of the World Ocean/seaArea1 Average depth sq km sq mimft Pacific Ocean 166,242,00064,186,0003,939 12,925 Atlantic Ocean 86,557,00033,420,0003,575 11,730 Indian Ocean 73,429,00028,351,0003,840 12,598 Arctic Ocean 13,224,0005,106,0001,038 3,407 South China Sea 2,975,0001,149,0001,464 4,802 Caribbean Sea 2,754,000 1,063,0002,5758,448 Mediterranean Sea 2,510,000 969,0001,5014,926 Bering Sea 2,261,000873,0001,4914,893 Sea of Okhotsk 1,580,000 610,0009733,192 Gulf of Mexico1, 544,000596,000 1,6145,297 Sea of Japan 1,013,000391,0001,6675,468 Hudson Bay730,000282,000 93305 East China Sea 665,000 257,000189620 Andaman Sea 565,000218,0001,1183,667 Blakhk Sea 461,000178,000 1,1903,906 Red Sea 453,000 175,0005381,764 North Sea 427,000165,00094308 Baltic Sea 422,000163,00055180 Yellow Sea 294,000114,00037 121 Gulf 230,00089,000100328 Gulf of California153,000 59,0007242,375 English Channel 90,00035,00054177 Irish Sea 89,00034,00060197. (Helicon Publishing Ltd, printed from the Hutchinson Encyclopedia, 2002) 24 To begin with the regulatory mechanisms in Power, Roads, Ports, Airports, and Telecom are for an overhaul Prime Ministers address, JRD Tata Centenary Celebrations by Assocham, TOI, New Delhi, August 25th 2004.

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CONTAINER PORTS EARLIER MODERNIZED 8. POSITRA- I (for Modern Container Port)

Situated near intermediate port of Okha at the entrance of Gulf of Kutch having natural protection from South West monsoon conditions.

It will consist of Positra- I, an exclusive modern container port at the historic Dwarka Beyt Island with 12 meters draft.

POSITRA - II (for Petroleum and Coal)

This will be a Petroleum and Coal Port with a draft of 18 meters. The nearest railway broad gauge link is only 15 Kms from the port site.

9. ROZI (Bedi) (for Agriculture Exports)

Rozi Port is proposed to develop an all weather direct berthing port facility near the anchorage to handle bulk carriers at a distance of 5 Kms from Rozi Pier at a depth of 15 meters to be exclusively developed as an agriculture port with modern handling facilities.

10. MUNDRA

For General Cargo: Salt, Cement, Minerals,25and Food Grains etc.

Mundra, near Rajasthan, is at 70 Kms West of the major port Kandla. It is proposed for development as an all weather direct berthing port to handle general cargo.

The location near Navinal lighthouse having a draft of 20 meters, at a distance of approximately 25 Kms. This port facility shall accommodate large ocean going vessels of 40,000 Tonnes.

6.06 Out of these 10 Ports, 4 will be developed by State Government, and 6 Ports will be open for total private investment.

7.00 GMB Ports to be developed

Rozi (Bedi) Agriculture Port

Positra Container & Petroleum Port

Dahej Industrial Port26

Mundra General Cargo Port

Navinal As per decision of GMB

7.01 There are two possible sites at Navinal Port:

[i] Near Bocha Island

Latitude: 22, 44, 00 N

Longitude: 69 43, 30 E

[ii] Near Navinal Island

Latitude: 22 43, 33 N

Longitude: 69, 42, 48 E

25 Minerals found in India are mentioned in Annexure A to these Notes. 26 National Thermal Power Corporation plans to import 1.5 to 2 million tonnes of LNG to meet its fuel deficits. It has written to Petronet LNG, Royal / Dutch Shell, RasGas of Qatar, Pertonas of Malaysia, Yemen LNG and Oman for 7 to 9 million standard cubic meters per day of gas for its power plans at Anta, Auriya, Kawas, Gandhar, Dadri and Faridabad. NTPC is in the process of a tie up with Petronet LNG & Shell to use their storage & regasification facilities at Dahej & Hazira Ports in Gujarat. PLL MD & CEO Suresh Mathur said Petronet has offered to process capacity of 2.5 million tonnes per annum of LNG until March 2005, and a capacity of 1.25 million tonnes per annum for April 2005 to 2007. Though the capacity of Dahej terminal is 5 million tonnes, the Plant can process upto 6.25 to 6.5. Million tonnes of LNG per year (PTI). See: NTPC to import LNG to meet fuel needs, ENTERPRISE G, The Times of India, New Delhi, Tuesday, September 7, 2004. pg. 14.

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Location:

15 Kms from Mundra Port

60 Kms from Kandla Port

52 Kms from Bhuj Railway Station

Estimated Investment: 1,000 Crore (1995 estimates)

Direct Berthing Sea Bed: 14 TO 20 m Draft within 2 Kms from Sea Shore.

For the above Ports to be opened to Private Sector the following governmental clearances shall be required:

National Institute of Oceanography

[After preparation of the following Report:

Environmental Impact Assessment

7.02 Accessibility to Ports is seen as a vital factor for site selection. The important factor to consider as the capital cost for any Port will depend on the extent of breakwater to be constructed in the berths. In the final analysis, it is the investment for each alternative site that will decide which one will be chosen in the end according to commercial need of the party seeking to Build, Own, and Operate a Sea Port.

7.03 The techno feasibility studies are expected to provide base for deciding the trade traffic, generally the atmosphere conducive to trade and commerce in a particular geographical area, keeping its vantage points in mind, and ascertainment of the trade prospects through a Port under consideration.

The Pre-feasibility studies are based on macro-economic parameters need to be supplemented by the actual microeconomic needs of the areas surrounding the port site under study.

7.04 Techno-economic feasibility studies shall be initiated by GMB who would undertake the construction of Wharf/Jetty/Quay and its maintenance. The superstructures like handling facilities and on-shore facilities in the form of warehousing, tank farms, etc will be privatized.

7.05 Preference will be given to State Government and Central Government Organizations on a negotiable basis. The remaining facilities for privatization will be done by inviting tender bids.

An initial premium will be charged for the land and wharf facilities and an annual lease rent would also be stipulated.

7.06 The detailed terms and conditions for privatizing these services will be finalized by GMB.

7.07 ET. 5 March 1997, Gujarat State Warehousing Corporation [GSWC] will make all possible efforts to develop International Container Freight Station [ICFS] at Positra Port, on the Saurashtra - Kutch coastline (as is developed by GMB). Mr. Harshad Brahmbhatt, Chairman, GSWC, in a seminar organized by the National Association of Container Freight Station [NACFS] said that ICFS in Saurashtra will help in the general development of the region.

7.08 GSWC has already set its deadline for its first ever container freight station to be set up at Dasharath near Vadodara. The GSWC Chairman has announced that it will complete the CFS work by the end of March 1997. 8.00 PORTS FOR PRIVATE SECTOR INVESTMENT 1. Simar Power Plant

2. Mithivirdi Steel & Automobile Export Port

3. Dholera General Cargo Port

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4. Vansi - Borsi Petroleum & Liquid Cargo Port

5. Maroli Industrial Port

8.01 These Ports will be privatized through a global tender bid. It was decided that Dholera will be the first privatized port.

8.02 Ports shall be given on BOMT [Build, Operate, Maintain, & Transfer] basis.

8.03 Government shall see to it that investments in the Port development of the private parties become a profitable venture for the entrepreneur.

The viability of a Port depends upon the location, the maritime27 conditions, Scale of investment, and the kind of cargo to be handled.

The Port Project shall be assured a reasonable rate of return. Proper investment analysis shall be essential, i.e., capital cost, revenue receipts, revenue expenditure, and capital recovery. GMB will study the financing pattern adopted by the World Bank and the Asian Development Bank,28 and other Financial Institutions to evolve a comprehensive package for the entrepreneur.

8.04 Only the Warfage Charges/Waterfront Charges will be as per the Schedule decided by the GMB. The promoters of a Port Project will be free to charge any other service charges with the prior approval of the GMB.

8.05 After BOMT period, the ownership of the Port and its assets will be transferred to GMB and they will examine to give it further on lease basis to the same promoter for future periods as may then be decided by GMB.

8.06 The terms & conditions will be finalized at the time of such renewal as above. The general guidelines for investment analysis and capital recovery for the Port Projects to determine BOMT period will be announced by the GMB.

8.07 Financing Ports. Housing and Urban Development Corporation Ltd. [HUDCO] takes pride in financing infrastructure projects in 52 cities. Recently it has financed the high level bridge across river parvati, built on the highway connecting Kota, Baran, Shahabad, and Shivpuri, this 805 meter long, 7.5 meter wide bridge has replaced the causeway that was used by the daily traffic. This has opened the gateway to the economy of this region.

8.08 HUDCO had sanctioned Rs 500 Crores for transportation/bridge projects in 52 Cities. HUDCO is playing a key role in providing housing to millions in India.

It shall be providing finances for airports, railway stations, port facilities, roads, by-passes, sub-ways, flyovers, bridges, transport nagars, bus terminals, water supply, sewerage, drainage, solid waste management schemes, street lighting, health and education facilities, sports, commercial and market complexes, technology parks, new town development.

Until now, HUDCO has sanctioned over Rs. 3,444 Crore until date for 462 Urban infrastructure projects that are commercially viable with the mechanism for full cost recovery. Prestigious assignments have been successfully handled by HUDCO, New Delhi to cover above infrastructure areas.

8.09 HUDCO offers 20 lakh Infrastructure Bonds with face value of Rs. 1000 each aggregating to Rs. 200 Crore with a greenshoe option of Rs. 50 Crore. These Bonds qualify for Income Tax benefits under Section: 54 E A and 54 E B.

27 Under the Constitution of India Maritime Shipping & Navigation, including shipping & navigation in tidal waters is the subject of legislation for the Union of India as found in Schedule VII, Entry 25, List 1. 28 Further details in international cooperation can be had from APEC - Asia Pacific Economic Cooperation, SAARC South Asian Association for Regional Cooperation, UNRO United Nations Relief & Rehabilitation Organization, UNRWA United Nations Relief & Works Agency, SUNFED Special United Nations Fund for Economic Development, IMF International Monetary Fund, IDA International Development Association, ICWA International Council for World Affairs, and NRF National Renewal Fund.

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8.10 ET 9 Jan.1997. The EXIM Bank of Japan has indicated its willingness to extend loans to Gujarat for funding its development programs, following the lines of Asian Development Banks latest policy to provide direct assistance to identified States.

8.11 Gujarat is the first Indian State to which ADB has agreed to provide Rs. 3,500 Crores. First tranche of about Rs. 100 Crores was disbursed to the State, 70% loans, and 30% grants. Although the amount of assistance had not yet been quantified, the Japanese Bank would not be averse to lending the amount similar to what ADB has offered to Gujarat.

8.12 Infrastructure upgradation called for substantial investments, which the State could not hope to attract even if the private sector was allowed entry into infrastructure projects. Therefore, finance from international lending institutions was required for Gujarat.

8.13 The State Government is planning an investment of Rs. 1000 Crore for the development of Rozi Port in Jamnagar Districts during the Ninth Five Year Plan. ET Rajkot. 10 Jan. 1997.

Mr. Umesh Rajguru, the State Minister for Ports, stated at Nawanagar Chamber of Commerce, that the Rozi Port would be developed mainly for the export/import of agricultural products and farm implements.

8.14 The 3.5 Km long Jetty would be constructed at the Rozi Port, which would be capable of accommodating 8 to 9 Steamers for loading and unloading operations at the Port site. The Jetty would be developed through the help of Private Sector Companies.

8.15 The Centre has already approved Rs. 4 Crore for the purchase of automatic material handling machinery to be installed at the Port. Commenting on the development plans for other ports in Jamnagar, the Minister said Rs.750 Crores had been earmarked during Ninth Plan. Industrial investments in Jamnagar currently stood at Rs. 20,000 Crore (1990).

8.16 The 8 small ports in Saurashtra to be developed by GMB at Simar, Mithivirdi, Dholera, Positra, Hazira, Maroli, Vansi-Borsi, will involve capital investments by private sector. ET. Jan. 12, 1997. The GMB had already taken up soil investigation exercises at Positra, Bedi, and Maroli Ports for preparing an Environmental Assessment Report before developmental works are taken up. Ports at Bedi, Dahej, Positra, and Mundra will be developed jointly by State & Central Government.

8.17 GMB has hired International Finance Corporation [IFC] for preparing a feasibility report to develop the Hazira and Dahej Ports in South Gujarat.

8.18 The State Government is trying to provide direct berthing facilities in all Ports in Saurashtra coast to cater to the rise in traffic from M.P., U.P., Rajasthan, Punjab, and Haryana to various Ports in Gujarat. International cargo will thereby increase by 40 lakh tones in the next two years on account of developed Port facilities, and availability of berthing facilities.

8.19 The Exports from the Kandla Free Trade Zone [KFTZ] are expected to touch Rs. 390 Crore during 1997. ET. 9 Jan. 1997. KFTZ has seventy 100% Export Oriented Units whose aggregate exports stood at Rs. 775 Crore in 1995-96. ]

Mr. Kadlabju said exports of these units are expected to touch Rs.1000 Crore during the current year. KFTZ provides direct employment to about 1000 people in 90 different units, where 60% of the workers are female. It has bonded area of 700 acres of land with plots and constructed sheds.

ET Bombay. 16 Dec. 1996. India must take advantage of the European Community Investment Partners [ECIP] facility, which aims to promote European Community [EU] joint ventures in Asia, as per Mr. Venkat Subramaniam, GM, Export Import Bank of India.

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18.20 The main objective of ECIP is to stimulate economic 29development in the host countries through joint ventures. The program is administered by a Partner Financial Institution [PFI] to the host country. ECIP is in operation in 27 Countries with 40 PFIs. The PFIs are Commercial Investment Banks, National, Regional Development Institutions, Multilateral Agencies, etc.

18.21 Gujarat State is also planning to invite Private Sector participation for starting Roll-On Roll-Off services between Saurashtra Ports, mainly, Pipavav, Jafrabad, and Ghogha were supposed to be connected by RO-RO Services to Hazira Port.

This will reduce pressure on State Highways30.

18.22 The Diu Administration is planning to start a catamaran service between Diu & Daman, mainly to develop tourism on Arabian Sea. Private proposals shall be welcome by the Collector of Diu for Catamaran Services. Maharashtra Government is working on a possibility of starting a hovercraft and catamaran services connecting Mumbai with the Union Territory of Diu, after its successful launch between Mumbai & Goa.

18.23 The Tourist can then travel by Sea to places such as Somnath, Chorwad, Ahmedpur-Mandvi, and Sasan Gir in Gujarat after their arrival by Sea routes [rapid transit mode].

18.24 In Maharashtra when the Hovercraft and Catamaran services were started in 1996, eight companies had initially applied governmental permission and clearance for starting hovercraft services, namely, SKS, Triton, Parasrampuria Plantations, New India Business House, Associate Capsules Group, N D Mittal Industries, and Mahindra Shipping Company.

18.25 The situation soon became anticlimax because of non availability of related infrastructure, only 2 operators, SKS, and Triton, remained to offer services of about 7 Hovercrafts, on Navi Mumbai to Gateway of India [Mumbai] route [ET 14 March 1997. Rashmi Singhal], while the most populated west coast is yet to begin services.

18.26 Also, the service was not profitable on account of lesser returns on massive capital expenditure. Catamarans cost wise are half as that of Hovercraft and has not yet really taken of as a popular means of travel on account of lakh of the supporting infrastructure facilities needed to popularize this mode of conveyance and local travel, as against the road and the local trains, etc.

18.27 Catamaran is not amphibious like Hovercraft. In Mumbai, the citys 2.25 million commuters congest the longitudinal roads every day, and the local trains carry 5 million people every day, commuting solutions therefore have become essential.

18.28 The fundamental viability, service provider s drawbacks and governmental support, needs to be seriously considered in assessment of commercialization of Catamaran for inland31 water transportation and Limousine for Road travel and the Hovercraft modes [aircraft capable of landing and taking off from the sea]for the commuters.

18.29 Probably the concept was premature in 1996 and was introduced before the time was ripe for it. Mr. Arvind Saraf, MD, SKS Ltd, as per the above quoted ET article, was inspired by the widely used water transport systems in Hong Kong and decided to imitate it in Mumbai.

29 Also see further details in Special Studies conducted by UNCAFE United Nations Commission for Asia & Far East, ECAFE Economic Commission for Asia & Far East, ECE Economic Commission for Europe, ECGC Export Credit & guarantee Corporation of India, Trade Development Authority of India, etc. 30 Total length of 55 National Highways in India was 15, 45, 891 Kms as on 31. 3 1982 out of which 7,31,959 Kms was the surfaced road and 8,13,932 was the unsurfaced road. Main National Highways are Agra Mumbai, Delhi Amritsar, Jallandhar Srinagar - Uri, Delhi Ahmedabad Mumbai, Chandigarh Manali, Ambala Simla Tibet, Jorhat Shillong Bangladesh. 31 Under the Constitution of India the Union and the States in India have concurrent powers to legislate in the area of Shipping & Navigation on inland waterways (by mechanically propelled vehicles) as provided for in Schedule VII, Entry 32 of List III. Navigation on inland waterways by means of any other kind of vessel, is a State subject under Entry 13 of List II.

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But, because of unstable water conditions, and lack of adequate supporting infrastructure, the Hovercraft mode was chosen as the most viable proposition. Being amphibious, they can travel on land, snow, and shallow waters.

18.30 With an initial investment of Rs 10 Crore, the Company invested in a fleet of 5 crafts. Although the initial plans were to invest Rs 30 Crore, a low response cut it to Rs 13 Crore. The 20 Seater crafts ply between Vashi, Navi Mumbai, and Gateway of India at approximately 60 % the seating capacity.

18.31 At a cost of Rs 22 per round trip, the collection per round is Rs 2,400. However, the hovercrafts often travel half-empty, during non peak hours. Fuel accounts for 12% of the collection, i.e., Rs 300 per round-trip, maintenance cost comes to Rs 12 lakh per year, 3% of the Rs 4 Crore turnover. SKS charters the crafts @ Rs 5000 per hour. At 100 % capacity, the collection for an hour is Rs 4000. SKS Vice President says [as per the above quoted ET article], for the west coast, we have already tied up finance for 2 large crafts from the United Kingdom, but the plans are on hold until the Government provides infrastructure support for this route.

18.32 The SKS is looking for Catamaran service business also because the Catamaran is available at half the price of a Hovercraft and for the commuter the fare is also @ Rs 60 as against Rs 125, for a one way trip on the Hovercraft. However, the area of the Catamaran service is an important consideration because the Catamaran cannot be navigated in the shallow waters.

18.33 Triton Over-water Transport Company, a hovercraft company, formed by SICOM, CIDCO, IL & FS, and Mahindra & Mahindra. The Company invested Rs 10 Crore on two 50 Seater one year old hovercrafts from the United Kingdom.

18.34 In Oct. 1966, the hovercraft, which started the services on west coast, was out of commission due to fire-in-transit between Chowpaty, and Juhu Beach. Offering services on the west coast is like serving to the passengers in the Sea, and far more difficult that the east coast. In Dec. 1996 the service between Vashi to Gateway of India were started.

The capacity utilization in 3 months is almost 50%. To become break even the Company needs 65% occupancy, with depreciation, the Company needs 75% occupancy to get at a break even point and to be commercially viable.

Their helicopter and trolley plans are scrapped because a helipad is required to be built in Cuffe Parade in South Mumbai. The Service provider cannot bear the costs thereof.

18.35 Gujarat State has invited private sector to upgrade the existing Surat Airport facilities on BOT basis. The Banks in India are now agreeing to finance private airlines, and such infrastructure projects, although the industry shall continue to be considered as high risk industry by the financers.

Jetty Leased to Private Parties for handling Cargo in Gujarat

18.36 Ashapura Ports, a Division of Mumbai based Ashapura Minechem Ltd has leased Mandvi Port in Kutch District for Cargo operations.

Earlier Company planned to construct a jetty at Mandvi Port while acquiring the capability to handle 3000-4000 MT of cargo per day at the jetty leased from GMB.

18.37 Facilities being provided by the Company at the Mandvi Port include cargo handling, equipments such as grabs, three Cranes with a capacity of 300 tonnes per hour each, and three conveyor belts.

18.38 Once the Company commissions the second jetty, the cargo handling capacity of the Port is expected to rise to 10 lakh tones per day.

Overall, the Company plans to invest Rs. 20 Crore in developing various infrastructure facilities at the Mandvi and Mundra Ports.

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The Company is to manage Mandvi and Mundra Ports as the newspaper report. 9.00 CAPTIVE JETTIES FOR INDUSTRIES 9.01 Permission for captive jetties would be given in exceptional cases, keeping in mind the quantum of investment, and the need for specialized facilities. All Industrial Units would be encouraged to make use of the new port facilities being set up.

9.02 Captive Single Port Mooring [SPM] facilities of industries located in Gujarat State will be charged at a concessional rate of wharfage for their captive consumption.

Nevertheless, captive cargo for industries located outside Gujarat, and non-captive commercial and industrial cargo will be charged full wharfage by GMB. Following services would be privatized:-

Lighterage

Dredging

Piloting

Tug Towing Service

Other Essential Utility Services

9.03 The lighterage operations will be privatized in the selected existing Minor Ports and in all New Ports.

9.04 For the use of Private Barges, the operator will have to pay the Service Charges as per the existing Schedule. This would increase the efficiency of handling of the cargo.

9.05 GMB will encourage joint ventures with private parties to form Dredging Corporation of Gujarat, to cater to the dredging needs of all the Ports in Gujarat State.

The existing equipments available with GMB will form the equity for such a proposed Joint Venture. 10.00 BARGE MOUNTED POWER HOUSE 10.01 To increase the availability and ensure quality of power in Gujarat State, the Barge Mounted Power Plants in five coastal districts of Kutch, Junagadh, Amreli, Bhavnagar, & Bharuch will be provided, with all corresponding Port Facilities therewith related.

10.02 They will be accommodated by GMB, wherever possible, in the existing Port Sites or other Sites identified by them in Coastal Gujarat/Gujarat Maritime Waters. To encourage establishments of these Barge Mounted Power Plants, wharfage would be charged at a concessional rate of 25% of the existing rate.

10.03 The Gujarat Government has decided to allow private parties engaged in Power Projects to generate & distribute Power, as an alternative to the hitherto accepted policy of entering into Power Purchase Agreements with these companies.

10.04 Adequate lignite quantum was also sanctioned for setting up another unit with 250 MW generating capacity at Mangrol in Surat District. The progress of 250 MW lignite- based power project at Mangrol, and Gujarat Industrial Power Companys 145 MW Power Project and its 160 MW expansion unit were reviewed by the Government before sanctioning the extra quantities of Lignite.

10.05 The Government desires to add 2000 MW generation to the present installations. Almost similar is the case with the State of Maharashtra.

The Shiv Sena -BJP coalition government in Maharashtra State has decided to offer nine new medium capacity Power Projects for private sector participation at a total investment of U S $ 1,725 Million [ET. 31 December 1996. Pramod Pagedar].

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10.06 Marubeni India Private Limited, a 100% subsidiary of Marubeni Japan is already present in 90 Countries, and in India for last 45 years, has evinced keen interest in establishing Power Station at Nakhatrana, and Ghogha in Gujarat.

Mr. T Tomata, MD, Marubeni, called on the Chief Secretary, Mr. S. K. Shelat, on March 11, 1997, [said to ET] that the Company was investing in Industries at Mundra, and other Ports in Gujarat.

The Company having global turnover of U S $ 151 Billion might enter the following business in India: energy, textiles, machinery, chemicals, and agriculture.

10.07 Gujarat Power Corporation Limited [GPCL], has identified 5 possible sites for Solar Power Projects, 3 sites in Kutch, and 2 in Banaskantha District.

A feasibility report was prepared by L & T, Sargent & Lendy, which favoured Solar Energy as a means of augmenting the States burgeoning Power need.

Rajasthan Government has already issued Letter Of Intent to three Companies for Solar Power Stations, which are AMOCO ENRON, and SUNSOURCE INDIA.

These two Companies are planning to set up 50 MW plants based on Photovoltaic technology. The 3rd Company ENERGEN shall be setting up Solar Chimney Technology Plant of 200 MW.

10.08 Capital Costs are high in Solar Installations. GPCL estimates Rs. 8 to 10 Crore Per MW of Solar Power, which is twice that of Coal/Gas based Power.

Bagasse based Cogeneration of Power is still cheaper. Less than Rs. 2 Crore Per MW, although seasonal Solar Plant requires vast stretch of land, 200 MW Solar Chimney Plant would need one stretch of 14,000 Hectares of land.

10.09 After Governmental clearances, GPCL (post 1997 period) was to invite global tender for these 5 Solar Power Projects.

No one seems to have thought about BARGE MOUNTED SOLAR POWER GENERATION INSTALLATIONS or BARGE MOUNTED or SHIP MOUNTED WINDMILLS, or few such installations for captive consumption of a PORT [Sea Port, Air Port, or Dry Port/Dock]. Private ventures are welcome in Power Sector by the Government of INDIA.

A separate survey, feasibility, cost benefit analysis, is possible in the above hitherto unexplored area, which awaits commercialization as any other infrastructure project.

10.10 British Gas Plc [Reliance, Essar] has joined the growing list of multinational Oil Companies interested in investing in the liquidified natural gas [LNG] business in India.

10.11 If viability is established the Company shall invest British Pounds 18 Million in the Project. The Company is one of the bidders before Gas Authority of India {GAIL}.

In order to compete with Naphtha as a fuel for power projects, LNG will have to be supplied @ U S $ 4 per million metric British thermal unit [MMBTU] ET. 12 March 1997 T PAGE 18.

10.12 The Union Minister of Maharashtra State for Power, Mr. S Venugopalakhhari said [ET. 12 March 1997] that proposals are on the anvil for legally enforceable fuel supply and fuel transport agreements, which the investors in the power sector can enter into with the Indian Railways and Coal Companies.

10.13 The Power Policy has already been framed realizing the crucial role that the foreign investors are going to play in the near future development of such infrastructure.

The Power Policy adequately addresses issues related to foreign private investments in the sector [Seminar On Commercialization of State Electricity Boards. Mumbai 12 March]

10.14 The Policy has already helped bring in a vast array of projects.

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About 200 expressions of interest to set up power plants have been registered, amounting to investment of about U S $ 85 billion and 78,000 MW of installed capacity. Of these 51 proposals are from foreign developers/investors for total of nearly 35,000 MW capacity, involving an investment of around U S $ 40 billion. 11.00 INFRASTRUCTURE DEVELOPMENT IN MAHARASHTRA 11.01 In Maharashtra State the Private Companys Liquid Chemical Storage Tanks at Jawaharlal Nehru Port {JNPT} plays an important contributory role in making the JNPT achieves its potential of having arguably the fastest turnaround time.

11.02 Ganesh Benzoplast Limited, [GBL] with present capacity of storage tanks at 1,00,000 KL, has already handled petro chemicals like Base Oil, Lube Oil, MEG, Palm Oil, Acetic Acid, Molasses, etc., through pipelines of MS & SS connecting the port to its storage site.

The Company, GBLs tank farm has been built to the world class standards having the State of Art Instrumentation, and adequate compliance with the safety norms.

A Nitrogen Plant at site, facilitates easy pigging of pipelines, tank blanketing, and prevention of hazards. The loading and unloading bay can handle over 200 MT per day. Available is a 750 KW power supply link with DG Set as standby.

A separate office building with all infrastructures includes a hook-up by wide area network and leased communication32 lines, to meet all client requirements.

11.03 This Company is first to commence storage operations at JNPT [further details: Mr. R K Gupta, GBL, Infrastructure Division, Ganesh House, Makwana Lane, Marol Naka, Andheri East, Mumbai 400 059.

11.04 The tentative list of B/C, and exempted class of chemicals permitted to be stored are as follows:-

Xylene Styrene

Cumene Acetic Acid

Lube Oil Base Oil

Kerosene Oil Molasses

MEG Formic Acid

Di ethylene Glycol Manitol

EDC Ethyl Alcohol

Nitric Acid Di Octyle Phthalate

Di Octyle Malcate Octonol

Carbon Tetra Chloride Aniline

Morpholine Solvents

Di Octonol Maleic Anhydride

Di Ethyl Oxalate Stytene Mono- Phenol

Caustic Soda Lye Benzaldehyde

Organics LSHS Heating Oil

Superior Kerosene Oil White Oil

32 For International activities in this area see the relevant Reports of ITU International Telecommunication Union, INTELEX International Telegraph Exchange, COMSAT Communication Satellite Corporation of USA, etc. Means of Communication excepted from Schedule VII, Entry 13 are those included in Entries 22 -25, 30 31, of List I, and Entries 32, 35 of List III.

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Neem Oil Phenol

Triethylene Glycol Furnace Oil

High Speed Diesel Blakhk Oil

Vegetable Oils [edible and non edible]

Propylene Sorbitol Glycol

Iso Propyle Alcohol Phosphoric Acid

Acrylic Acid Di Butyle Malcate

Di Octonol Glycerin

Polyether Polyols Castor Oil

Palmolive Oil, etc.

The same law is applicable for chemical storage in Gujarat State also. For brief on Port Development in Maharashtra State see para 18.00.

11.05 SCICI, Maharashtra Maritime Board [MMB] has signed MOU to promote and develop minor ports in Maharashtra State. The agreement was signed in the presence of Mr. Promod Navlakhi, Minister for Transport & Ports, and Chairman MMB.

11.12 MMB would require substantial funds for participating in Port Projects.

11.13 Other developments in Maharashtra State are supportive in nature. Mumbai Metropolitan Region Development Authority (MMRDA) came in to being on January 26th 1975 under the MMRDA Act, 1974. This apex body of the government of Maharashtra is for planning, coordination, and implementation of Developmental activities in Mumbai Metropolitan Region.

MRDA conducted Detailed Feasibility Study of the selection of Mass Rapid Transit (SMART) system under Indo-German Technical Co-operation by entrusting the Consultancy Work33 to Transport East West Expert Team (TEWET) in association with De Consult and TCS during 1997-2000. This indicates the related development required for proper functioning of Ports. 12.00 PORT RELATED INFRASTRUCTURE DEVELOPMENT [Gujarat] 12.01 In Gujarat State infrastructure development is planned in three corridors, as follows:

1. Ports of Okha, Positra, Rozi, Jamnagar Refineries, Navlakhi, Kandla, Mundra around the Gulf of Kutch. The road connecting these Ports will be linked with Rajasthan, through Radhanpur and Tharad, and later to Northern States.

2. Ahmedabad was connected to Ports Dholera, Bhavnagar, Mithivirdi, Alang, Pipavav, Simar & Veraval sea ports.

3. Dahej, Hazira, Vansi - Borsi, and Maroli, which will be linked to the proposed Express Highway.

12.02 These corridors connecting respective Ports offer potential for truck traffic, which will be highly suited for privatization in the near future. These corridors offer nearest destinations to adjoining hinterland States of Rajasthan, M.P., and Maharashtra.

12.03 Gulf of Kutch corridor offers the possibility for second railway line parallel to the existing one to be connected to Mehsana-Palanpur-Delhi route, which is under gauge conversion.

33 Consulting Engineering Services (India) Private Limited upgraded the Study in 2004.The Study recommended that rail based Mass Rapid Transit System (MRTS) for Versova-Andheri-Ghatkopar corridor economically viable and potentially bankable. Technical and Financial proposals were invited from Indian or Foreign Companies authorized to do business in India or JV Consortium (not exceeding 5 JV partners) by MMRDA on Build, Own, Operate, & Transfer (BOOT) basis fro 35 years. TOI, August 21, 2004, Page 13, Advertisement for Sale of Bid Documents by Dr. Suresh Joshi, Metropolitan Commissioner, MMRDA, Bandra-Kurla Complex, Bandra (E) Mumbai 400 051. http://immrdamumbai.org

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12.04 Like-wise, Rail line Ahmedabad-Surendranagar-Bhavnagar gauge conversion, its ultimate extension upto Veraval along the coast, by broad gauge railway line offers good privatization potential, mainly, at Port locations for wagon investment by private entrepreneurs.

12.05 After development, with modern facility these Ports can act as Transshipment Ports for India.

12.06 Introduction of Ro-Ro Service and Hovercraft / Catamaran Service joining different terminals on Saurashtra and Kutch Coast with South Gujarat will be given highest priority.

This will not only save the money and time of transportation of men and material, but will substantially reduce pressure on existing rail and road networks.

Tourism site linkages will also be promoted {by rail, road and sea routes], including promoting water sports/recreation.

With little additional allocation in the Central and the State Budgets for Tourism Sector, India can wipe out its entire deficit on Oil Pool Account, a whooping Rs. 15,000 Crore, in just few years time, as per Tourism Minister, Mr. Srikant Jena. ET. 6 March 1997, pg. 3.

Tourism was the second largest foreign exchange earner for the country. Total 2.2 million foreign tourists arrived in 1996, and foreign exchange earned from the se tourists was Rs. 10.061 Crores, making a 16.5% hike over the record of 1995. National Development Council and Planning Commission are taking up this issue seriously.

12.07 GMB will create the terminal facility with Governments money and a service charge will be collected from the operators.

12.08 Dahej-Ghogha, Surat-Bhavnagar passenger terminal facilities will soon become popular.

12.09 Ultra modern vessels are likely to navigate in the Gulf of Kutch with newly developed Port facilities in the near future.

Therefore, exclusive Vessel Traffic Monitoring System (VTMS) will be introduced in cooperation with Indian Navy34.

12.10 Maritime related industries would be given priority to be located along Gujarat coast, in collaboration with the leading global manufacturers, in the field of ship building, ship repairing, dredgers, and other flotilla units like tugs, barges, launches, and support crafts.

The traditional boat building activities at Veraval and Mandvi would be expanded.

12.11 Gujarat Maritime Waterfront would be leased to such manufacturing units at subsidized rates.

12.12 Industrial Incentive Policy in existence shall be applicable to such maritime related industries.

12A. PORT FINANCE, BUDGETARY SUPPORT

[i] The Union Ministry of Surface Transport pegged the required gross budgetary support [GBS], net budgetary support [NBS], plus external assistance [EA] for the Ports at roughly Rs.300 Crore for the financial year 1997-98.

[ii] Proposed GBS is more than double, and Union Budget matches Infrastructure Policy which views Port as a key element along with Power, Telecom, & Roads (transport systems}.35

34 The Naval Training Centers of the Indian Navy are: Indian Naval Academy at Kochi, INS Angre at Mumbai, INS Valsura at Jamnagar, Naval Air Station Garuda at Kochi [Ernakulum - Cochin], INS Venduruthy at Kochi, INS Hamla at Mumbai, INS Kaunjali at Vishakhapatnam, Sailors Training Establishment, Dublin at Goa and T. S. Rajendra at Mumbai. 35 In the Capital the government is planning to introduce High Capacity Bus System (HCBS) infrastructure. The Bus moves on dedicated Lanes with separate Lanes for Pedestrians, Cyclists, and Motor Vehicles to maximize travel space. It is cheaper than Metro Rail System. HCRS infrastructure for 20 Kms can be built in 18 months; the Metro System would take many years. HCBS costs about Rs. 5 Crore to Rs. 50 Crores per kilometer, whereas Metro Costs between Rs. 100 Crores to Rs. 1000 Crores per kilometer. HCBS is operational in Belo Horizonte, Bogota, Campinas, Curtiba, , Goiania, Lima, Porto Allegre, Quito, Recife, Sao Paula, in south America; Claremont Ferrand, Eindhoven, Essen, Ipswich, Leeds, Nancy, Rouen in Europe; Honolulu, Los Angeles, Miami, Ottawa, Pittsburgh, Vancouver in the US, Akita, Fukuoka, Gifu, Kanazuwa, Kunming, Miyazaki, Nagaoka and Brisbane in Australia. (Bye Bye Blueline, Times of India, Delhi Times, Saturday, October 23, 2004, pg. 12 (by Jyoti Sharma).

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13.00 EXTERNAL ASSISTANCE FOR ENNORE & PARADEEP PORTS 13.01 External Assistance may climb up to Rs. 250 Crores as against 1995-96 external assistance of Rs. 106.60 Crores. This would mean government will be able to meet with its commitment to

finance Ennore and Paradweep Port Projects.

13.02 This includes development of a New Port at Ennore. It covers establishing coal handling infrastructure at Paradeep Port (an ADB assisted venture}, facilitating a Japanese [ORET] grant to Dredging Corporation of India [DCI] for processing a new dredger, replacement of Pir Pau Oil Pyre at Mumbai Port [also ADB assisted], and installation of Vessel Traffic Management System [VTMS] at Mumbai Port.

13.03 External Assistance related projects nearing completion near Mumbai are the replacement of the existing lock gate at Indira Docks, and the Commissioning of a new Fire Float Vessel at the earliest.

13.04 Other ongoing projects at Mumbai Port are the replacement of Sub-Marine Pipelines, and construction of a Marine Oil Terminal [MOT], which is to be funded by the Port and not through budgetary allocations.

13.05 The main targets of the Government are:

1. Development of a new port at Ennore.

2. Creation of coal handling infrastructure at Paradeep Port [an ADB assisted venture].

3. Facilitating a Japanese [ORET] grant to Dredging Corporation of India [DCI].

4. Replacement of Pirpau Oil Pyre at Mumbai Port [ADB assisted].

5. Installation of Vessel Traffic Management System [VTMS] at Mumbai Port.

6. Replacement of the existing Lock Gate at Indira Docks.

7. The Commissioning of a new Fire Float Vessel at Mumbai Port. 14.00 CARGO DELIVERY SYSTEMS 14.01 The revival of multimodalism or Door to Door Cargo Delivery, a dead territory so far in the entire chain of cargo movement in India, is being watched very closely by the trade, with export promotion efforts being actively speeded up, the exporters have lobbied amendments to revise the Multimodal Transportation of Goods Act, 1993 [MMTG].

14.02 Multimodal Transport could not be lifted to the height envisaged by the 1993 Act because of ambivalent approach of the Multimodal Transport Operators [MTOs] who failed to arrive at a consensus to operate within the parameters laid out for the multimodal delivery of goods.

14.03 However, the system is still a viable means of transport and Government is considering