Budget Analysis: Emphasis on infra spend is limited, says Essar Ports

 Rajiv Agarwal, Managing Director, Essar Ports  

The budget has a high focus on social sector, while nothing new has been done specifically to spur infrastructure spending. The mentioned schemes of take out financing and credit enhancement through IIFCL etc have already been in place.

 The government has announced two new Major Ports, one at Sagar in West Bengal and one in Andhra Pradesh to further augment the national capacity by 100 million tons, and a plan for developing outer harbour at Tuticorin Port which would enhance capacity by around 40 million tons.

Listed below were industry expectations from the Union Budget 2013-14.

Fast track clearance

Development of several port projects which were awarded 2-3 years back got delayed. Bidding process should be accelerated by centralization of database  Several projects need to be restructured to make them financially viable.

Port Tariff should be deregulated

Port sector in India has become highly competitive after liberalization with high competition among ports and terminals within the port
Tariff regulation is restricting investment in the major ports and there are no takers for several projects at major ports
This has resulted into lower capacity addition and in turn lower option and poor service to the customers.