GP Rai, Acting chairman, Mormugao Port Trust: Connectivity has to be rethought, and we have done that

Mormugao is Goa’s oldest port that is accorded major port status since 1963. Goa has faced some decline in industrial activity after the Supreme Court’s ban on mining since 2012. But the port is still quite relevant in the region. The deputy chairman of Mormugao Port Trust, Guruprasad Rai, who is also acting chairman of the company, outlines the challenges and growth plans of the port. Rai, who has a career spanning nearly three decades, talks to Pankaj Joshi and R N Bhaskar about his vision for the port.

What are growth constraints and how do you plan to deal with them?

The first constraint is space and the other is obviously roads which run through urban areas. Today, we are allowed only six-seven hours of cargo movement through the city. Since we lose around five hours a day, this is a capacity constraint, and there are also the innate risks of moving through city traffic.

Connectivity has to be re-thought and we have done that by commencing construction of a four-lane flyover which should be completed by 2019. Once the road connection is free of city and the related traffic, we can see cargo movement 24 x 7 from the port.
Space constraint can be solved only through a reclamation permit. Against that, Goa does not have much manufacturing so that impacts feasibility. See JNPT –the port has bolstered business activities in Navi Mumbai and also increased population. There is connectivity at Panvel, then Kalamboli, Raigad, Alibaug. Now the city is developed and well-used. So, JNPT should think anew for development. They could for instance look at a parallel port at Rewas. If you spend about Rs 2,000 crore for dredging, all dredged material could go into reclamation and can rebuild a parcel of 800 hectares land.

We are looking at such a parallel port solution at Vijaydurg port in Maharashtra, around 152 km from here. Since investment is a constraint, we would look at a joint venture between MMB (Maharashtra Maritime Board), JNPT, MbPT (Mumbai Port Trust) and Mormugao (MPT).

Another important thing is that there is a refinery planned at Nanar, and unless that comes up the port idea would not work. This is supposed to be the biggest in India and involves all the PSUs— IOC, BPCL and HPCL. That would be the viability engine for phase I. For the next phase we are expecting cargo from Southern Maharashtra. It would be bauxite, gypsum, even agri-produce. We expect roughly 10 million tonnes, most of it export-oriented. Cost-wise, we estimate the first phase to be Rs 2,000 crore, mainly because of the breakwater component. The next phase, basically incremental add-ons, would be around Rs 500 crore.

How do you see revenue patterns of MPT changing?

Not much in the immediate future. Our revenues are substantially dependent on the state’s economic position. After the 2012 ban on mining by the Supreme Court, we have seen an affect in our revenue pattern. To make it clearer, in the 2009-11 period, we used to handle 50 million tonnes annually, of which 40 million was iron ore. This year, we are handling 20 million.

While our location is quite strategic – touching South, West and Central India – there are other constraints. Today for ports, containerisation is a growth engine, but most of the current container traffic is in the North.  The hinterland traffic is growing, we can see the scope. But there are no four-lane roads across the Western Ghats. Basically, connectivity was needed across two hills. The Castle Rock-Kulem section, with a 1/32 gradient, is today the steepest route in the country.
Another aspect is policy emphasis, which in Goa is on tourism whereas in all the neighbouring states, the political will is strong and there are policies for cargo and roads. Perhaps a generation later, we will realise that we did not do enough, but then we may be left behind. Here you may also factor in resistance that comes from the local population. But once the locals realise that economics are important for employment avenues to sustain, thing might change here.

Today our inland waterways advantage is in peril, where Goa is among the best. You must appreciate the iron ore cargo which exclusively comes in through inland waterways (through barges). But today, the entire barge industry is close to bankruptcy, owners cannot pay their debt. If things do not change, truck owners, barge owners all may look to suicide. Joblessness is another aspect of the ban. We are looking to develop coastal waterways with a MoU between Inland Waterways, the state government and ourselves.

You spoke of a tourism thrust, can that be a trigger?

On the tourism front, there is much effort being put in. We realise this place is somewhat isolated from mainland Goa, where the best tourist option would be Panaji. We have put in ferry connectivity from Baina which will be a win-win for all. The benefit we have compared to other ports is that the airport is just 15 minutes away.

So those coming in cruise ships can then get here via ferry and plan return via the airport. The berth today that we have is for 300-metre boats, whereas the minimum need for cruise ships is 450 metres. If we can spend just Rs 12 crore, cruise ships can come. Connectivity for such traffic is already there.

Now there is a more unique problem, which is that most tourists come for a day and leave by the evening, which essentially means the traffic on the roads is more intensive. Once the flyovers happen, we estimate the ships calling here will double. Today we are handling 30 cruise vessels yearly and Mumbai is handling 40. We know Mumbai plans for 100, then we can handle 70 because nearly all traffic comes down from Mumbai. The planned flyover will have an arm coming into the port area and will decongest the roads. With that advantage, we believe we can handle 100 cruise liners by 2025 or even earlier. Our tourism income should double.

One constraint here is that there are three agencies involved in cruise operations—port reports to shipping ministry, customs reports to commerce ministry and immigration reports to home ministry. Only if they come together, the procedures will be streamlined and all facilities which I offer can be utilised. We need all of this under one umbrella, maybe through making the port an SEZ, or an Exim Gateway.

In containers, our base is small but we aim to grow annually at 25 per cent. If mining restarts that segment will also grow rapidly. Today, a few thousand containers are coming from Goa to JNPT by road, if there is a policy decision and those get diverted there is another growth engine. The Sagarmala policy is a great thrust.

GP Rai, Acting chairman, Mormugao Port Trust: Connectivity has to be rethought, and we have done that

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