On 25 March 2015, the Union Cabinet, chaired by Prime Minister Narendra Modi, shows the final nod to proceed with the Sagarmala Project and prepare the idea and institutional framework. It was an important development in India’s growth story. Taking ex-PM Atal Bihari Vajpayee’s dream project forward, Modi has correctly identified Sagarmala as a crucial infrastructure initiative whose development has the potential to boost India’s GDP by 2%.
The vision of the Sagarmala Programme is to decrease logistics cost for EXIM and domestic trade with minimal infrastructure investment.
- Decreasing cost of transporting domestic cargo through optimizing the modal mix
- Decreasing logistics cost of bulk commodities by locating future industrial capacities near the coast
- Enhancing export competitiveness by developing port proximate discrete manufacturing clusters
- Utilizing time/cost of EXIM container movement
Components of Sagarmala Programme are:
- Port Modernization & New Port Development: De-bottlenecking and capacity increment of existing ports and the development of new greenfield ports
- Port Connectivity Enhancement: Increasing the connectivity of the ports to the hinterland, optimizing cost and time of cargo movement through multi-modal logistics solutions including domestic waterways (inland water transport and coastal shipping)
- Port-linked Industrialization: Developing port-proximate industrial clusters and Coastal Economic Zones to decrease logistics cost and time of EXIM and domestic cargo
- Coastal Community Development: Encouraging sustainable development of coastal communities through skill development & livelihood generation activities, fisheries development, coastal tourism etc.
Implementation of the projects identified under the Sagarmala Programme will be taken up by the related Ports, State Governments / Maritime Boards, Central Ministries, mainly by private or PPP mode.
The Sagarmala Development Company Limited (SDCL) has been incorporated (on 31st August 2016) under the Companies Act, 2013, after getting the approval of the Union Cabinet on 20th July 2016. SDCL has been established under the administrative control of Ministry of Shipping with an initial Authorized Share Capital of Rs. 1,000 Crore and a Subscribed Share Capital of Rs. 250 Crore. SDCL will grant equity support for the project Special Purpose Vehicles (SPVs) set up by the Ports / State / Central Ministries and funding window and /or implement only those residual projects which cannot be funded by any other means/mode.
Objectives of SDCL
- Develop & formulate projects emerging from the National Perspective Plan (NPP)
- Guide project SPVs set up by Central Line Ministries / State Governments/State Maritime Boards/Ports etc. for projects in alignment with Sagarmala objectives
- Grant funding window for residual projects that cannot be funded by any other means/mode
- Make and create the Detailed Master Plans for the Coastal Economic Zones (CEZs) identified as part of the National Perspective Plan
- Raise funds from multilateral and bilateral agencies as debt/equity (as long-term capital), as per the project need