The most talked after Sagarmala Project, envisaged by the Ministry of Shipping, proposes fourteen Coastal Economic Zones (CEZ) across major and non-major ports of India in a comprehensive plan to support the BJP-led government's Make in India initiative.
The proposal comes at a time when India is lagging far behind in port-led industrialisation than China – its key economic competitor. The CEZs are expected to increase India’s merchandise exports by 110 billion by enhancing industrial competitiveness.
The CEZs to be built as per a comprehensive plan for port-led industrialisation will embrace 12 industrial clusters those will require up to Rs 8 lakh crores of industrial investment and Rs 15,000 crores of investment in basic infrastructure.
The plan says that twelve major clusters across three broad sectors – energy, material and discrete manufacturing – have been proposed in the CEZs on the basis of suitability of ocean mode of transportation for imports of raw material or exports of finished products.
The proposed port-led development is expected to not only reduce logistics costs by optimising movement of cargo, but also impact competitiveness in availability or raw materials, skills, supporting infrastructure and existing industrial agglomeration.
As per the plan, coastal states will have one or more CEZs. The industrial clusters within these zones will enjoy the benefit of lower cost of movement by waterways. It has been observed that EXIM containers in India travel 700 to 1,000 kilometres between production centres and ports. The plan attempts to decrease it substantially by facilitating port-led industrialisation.
Three energy clusters to meet the future power requirements of the country have been planned in proposed Poompuhar CEZ in Tamil Nadu and North Konkan CEZ in Maharashtra.
Two refining clusters in proposed Mannar CEZ in Tamil Nadu, Soth Konkan CEZ in Maharashtra or in Poompuhar CEZ in Tamil Nadu.
The plan also proposes four petrochemical clusters in proposed CEZs to be built up in Gujarat, Karnataka, Odisha and Tamil Nadu.
Furthermore, it aims to enhance steel and cement production by 40 MTPA each by 2025 by creating coastal capacity and thus reduce logistic cost by Rs 1,000 per ton and make domestic manufacturing more competitive.
As per an analysis, six discrete manufacturing sectors – food processing, automotive, electronics, apparel, leather products, footwear and furniture – will be set up. Separate industrial clusters are also proposed in the CEZs to be built in the coastal states of the country.
The proposed Coastal Economic Zones are named Kachch, Suryapur and Saurashtra in Gujarat, North Konkan and South Konkan in Maharashtra, Dakshin Kanara in Karnataka, Malabar in Kerela, Mannar, VCIC South and Poompuhar in Tamil Nadu, VCIC North and VCIC central in Andhra Pradesh, Kalinga in Odisha and Gaud in West Bengal.
The plan admits that there is a gap in demand and supply of skilled manpower to implement the project successfully in the coastal districts and required to be plugged using special skill development program. The Sagarmala Project proposes a massive training drive among the people in the coastal regions to meet the requirement.
Sagarmala project aims to invest Rs 70,000 crore in facilitating economic growth by enhancing coastal shipping of goods.