The Giant Leap

The Sagarmala project has made huge progress in the last three years, but funding is a big constraint.

- P.B. Jayakumar

OFTEN, THE HUGE SCALE OF infrastructure projects can be a hurdle in itself. This is what is happening to Sagarmala – a project for port-led development by harnessing India’s 7,500-km coastline, 14,500 km of navigable waterways and improving access to international maritime trade routes. Sagarmala has taken a number of strides in the last three years, but funding and lack of active participation from the private sector are proving to be major constraints in its timely progress.

Until the end of 2017/18, 225 projects, valued at ₹2.38 lakh crore, were being implemented. Another 196, worth ₹71,868 crore, are likely to be awarded in 2018/19. In all, 98 projects, worth ₹31,046 crore, are expected to be completed in 2018/19. However, till Marchend this year, only 59 projects, worth ₹11,299 crore, had been completed, according to a Ministry of Shipping statement. The total investment envisaged in the project is more than ₹8 lakh crore, but only 15-20 per cent port or other shipping infrastructure improvement projects are under way. The remaining are still at the “feasibility study” stage. Fund mobilisation, lack of interest from stakeholders in public-private partnership (PPP), ventures and an uncompetitive shipping industry are making implementation an uphill task.

Not with standing the huge progress in building infrastructure over the last few years, India spends 19 per cent of its gross domestic product (GDP) on logistics, as against China’s 12.5 per cent, Indonesia’s 15.72 per cent and UK’s 13.43 per cent. One reason why China spends less on logistics than India is waterways – waterway transport costs only ₹0.2-0.3 per tonne, while rail transport costs ₹1.2-1.5 per tonne and road movement ₹2-3 per tonne. Coastal and inland water transport accounts for a 25 per cent share in China; in India, it is just 2-3 per cent.