FINANCIAL ASPECTS OF PORT MANAGEMENT

FINANCIAL ASPECTS OF PORT MANAGEMENT

POLICIES OF PORTS AND PORT MANAGEMENT IN INDIA

 POLICIES OF PORTS AND PORT MANAGEMENT IN INDIA

•The federal structure of the Constitution of India

divides the legislative powers between the Union and
the State Governments with respect to the port sector.

•The Constitution of India contains subjects that are

categorized into the Union List, State List and the
Concurrent List for legislative purposes in the Seventh
Schedule.
 The Major Ports in India

•The Major ports in India, are placed in the Union list of the
Indian Constitution.
•They are statutory bodies (trusts) administered by the
Union Ministry of Shipping, Government of India.
• The major ports are governed by a Board of Trustees,
under the Major Port Trusts Act, 1963.
•The Union Government nominates the members of the
Board and appoints the Chairman. The other members
include the Deputy Chairperson; and Trustees, representing
labour employed in the port; the State Government; the
Government departments specified; and other interests
 The Minor Ports in India

•The minor/non-major ports located in all the Maritime

States of India are placed in the “concurrent list” and
administered by both the Union and the State
governments.

•As per the Indian Ports Act, 1908, the responsibility

for the development of the Minor Ports in the Maritime
States of India is vested with the concerned State
Governments.
 MARITIME BOARD IN INDIA

Maritime board is tasked with the administration of ports and harbours,

conservancy, licensing of crafts, levying of fees, regulation and control of
sea traffic.

Functions of Maritime Board:

•Development of Minor Ports and harbours for promoting cargo movement
with a view to boost the economic activity along the coastline and state’s
hinterland.
•Enforcement of maritime rules and regulations for the administration and
conservancy of ports, for regulating traffic and tariiff structure and
licensing of crafts.
•Development of Inland water transport for cargo as well as for passenger
movement in the inland waterways within the state.
 MARITIME BOARD IN INDIA

• To carry out hydrographic surveys and other allied investigations along

the coasts; in the creeks as well as in the rivers of the coastal region
•To carry out various functions assigned to it by the Government from time
to time.
•To promote export oriented industries and port based industries along the
coastal
•To decongest highways and railways by providing facilities for coastal
traffic along coast
•To promote tourism, cruises and coastal trade.
 Maritime Boards of the States

•The nine maritime states of West Bengal, Odisha,

Andhra Pradesh, Tamil Nadu, Kerala, Karnataka, Goa,
Maharashtra and Gujarat control 185 State ports and
jetties, of which 60 are truly operational.

•The functions of the Maritime Boards of the States

include formulating waterfront development policies
and plans; attracting private investment; and enforcing
environmental protection standards.
 Maritime Boards of the States

•The nine maritime states of West Bengal, Odisha,

Andhra Pradesh, Tamil Nadu, Kerala, Karnataka, Goa,
Maharashtra and Gujarat control 185 State ports and
jetties, of which 60 are truly operational.

•The functions of the Maritime Boards of the States

include formulating waterfront development policies
and plans; attracting private investment; and enforcing
environmental protection standards.
 Maritime States Development Council (MSDC)

• The Maritime States Development Council (MSDC)

was constituted in May 1997 under the Chairmanship
of the Minister of Shipping.
•The Ministers in charge of Ports in all the Maritime
States, Union Territories of Puducherry, the Andaman
and Nicobar, Daman and Diu and Lakshadweep
islands are its members.
•The deliberations and decisions of the MSDC provide
the institutional framework for the coordinated
development of both Major and Non- Major ports
 LEGAL STRUCTURE

• The Indian port sector is thus regulated and

governed by several laws that may be
categorized into port laws, shipping laws, port
labour laws, and environment‐related laws along
with strict adherence to international laws.
• New laws and policy measures are being
adopted by the Ministry of Shipping to improve
the operational efficiency and competitiveness
of Indian ports.
 Other Government Agencies

•In addition, the Tariff Authority for Major

Ports (TAMP) regulates the tariffs related to
vessels and cargo as well as leasing of the
property at major ports.
•The other key Union Government ministries
and agencies that are involved in the port sector
include the Department of Industrial Policy and
Promotion, the National Highways Authority of
India and the Rail Vikas Nigam Limited.
 Other Government Agencies

•The Department of Industrial Policy and Promotion

functions under the Ministry of Commerce and Industry
which formulates, implements and monitors industrial
policy and promotes and facilitates FDI flows into all the
sectors including ports.

•The National Highways Authority of India (NHAI) is

mandated to implement projects that ensure connectivity
of major ports to national highways. Lastly, the Rail
Vikas Nigam Limited’s (RVNL) main objectives include
providing strategic
 Other Government Agencies

•The Rail Vikas Nigam Limited’s (RVNL) main

objectives include providing strategic rail
communication links to ports; constructing mega-
bridges for improving communication to the
hinterland, and developing multi-modal transport
corridors.
 Institutional Framework governing Port Administration in India

Ministry/Agency Functions
Ministry of Shipping Formulates policies and programmes for major ports, shipping,
ship building and ship repair, fishing vessels and floating crafts,
national waterways, lighthouses and inland water transport

TAMP Constituted in April 1997, under the Port Laws (Amendment)

Act, 1997, TAMP regulates tariffs related to vessels and cargo,
and the rates for leasing property at major ports.

Major Port Trusts The major port trusts were set up under the Major Port Trusts
Act, 1963. Major ports are autonomous bodies managed by a
board of trustees under the overall control of the union
government through the MoS. Port trusts have overall control of
the major ports
 Institutional Framework governing Port Administration in India

Ministry/Agency Functions

State maritime boards States administer their minor ports either through state maritime
and port departments boards or through state government departments. The maritime
boards were created to focus on maritime development of the
respective states. They have structure and powers similar to
those of the board of trustees of a major port. Currently,
Gujarat, Maharashtra and Tamil Nadu have maritime boards

Directorate General of Deals with the implementation of policy and legislation related
Shipping (DGS) to shipping industry. It also looks after safety, prevention of
marine pollution, promotion of maritime education and training
in coordination with the International Maritime Organisation,
regulation of employment and welfare of seamen, development
of coastal shipping, augmentation of shipping tonnage, etc.
 Institutional Framework governing Port Administration in India

Ministry/Agency Functions

State maritime boards It undertakes and promotes techno‐economic studies and

and port departments research, creates an information base relating to the port sector,
bringing together various national and international
organisations involved in port and harbour operations,
management and allied activities, etc.
 Legislations governing the Port Sector in India

•The Regulatory environment governing the port sector in India is

administered by a number of Port Laws, Shipping Laws, Port Labour
Laws and Environment related Laws.

•The two major laws guiding the Port Sector in India are the Indian
Ports Act, 1908 and the Major Port Trusts Act, 1963. While the former
applies to both Major and Non-Major Ports in the country, the latter
applies only to the major ports.

•The Ministry of Shipping started the process of amalgamation of the

Indian Ports Act, 1908 and the Major Port Trusts Act, 1963 with the
objective of simplifying the two legislations into one. Accordingly, an
Indian Ports Bill, 2011, was drafted in 2010 for consultation and
legislative process. However, the Act is yet to be introduced in
Parliament.
 Major Indian Port and Shipping Laws

Indian Ports Act 1908: The Indian Ports Act 1908 was the first-
ever comprehensive Indian Port Law to be enacted for governing
the administration of all ports in India. The 1908 Act fixes the
basic powers and responsibility toward protection and ownership
of port lands, sea- creeks, estuaries, backwaters, bays, sea-locks,
rights to development of water front development, port entry and
navigation channels, protection and preservation of marine
environment, etc, with the government. The 1908 Act distributes
the powers between the central and state governments with
respect to development of various ports and the state rights over
collection of port-related dues. All residual powers to regulate the
port sector are vested under the 1908 Act with the central
government. These provisions mainly relate to ownership of port
land and use of marine coastline
 Major Indian Port and Shipping Laws

The Major Port Trusts Act 1963: The Major Port Trusts
Act 1963, for the first time laid out the institutional
framework for creation of separate port authorities for
each major port and defined the powers and functions
of such a port authority in respect of all aspects of port
functioning.
 Major Indian Port and Shipping Laws

Merchant Shipping Act of 1958: The Merchant

Shipping Act 1958 which mainly deals with shipping
regulations of the country also has some bearing on the
working of ports. The jurisdiction of the Director
General of Shipping, empowered under the Merchant
Shipping Act includes conducting on-board ship
inspections, pollution control and environmental safety
compliance and ballast water discharge etc on overseas
and Indian flagged ships.
 Major Indian Port and Shipping Laws

Dock Workers (Regulation of Employment Act 1948):

The Dock Workers (Regulation of Employment Act
1948) was enacted to remove the anomalies in the
working conditions faced by port workers under private
stevedoring companies. This law sought to regularize
the terms and conditions of employment of port labor,
frame standard service rules and other welfare issues of
interest to port and dock workers.
 Major Indian Port and Shipping Laws

Environment Protection Act 1986: The Ministry of

Environment and Forests administer the Act. Under the
act, the coastal stretches of seas, bays, estuaries, creeks,
rivers and backwaters that are influenced by tidal action
(on the land side) up to 500 meters from the high tide
line and the low tide line, is declared as the coastal
regulation zone (CRZ).
 धन्यवाद
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