Extensive Port Changes Approved in New Delhi

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The Indian Government has announced its approval of the 2016 Major Port Authorities Bill, which will replace the existing Major Ports Act that has been in operation since 1963.

The new bill was agreed by the government in New Delhi and is set to be a major overhaul in existing regulations that have lasted for a generation. The Major Port Authorities Bill has been established in a bid to empower 12 major ports by granted them all full autonomy in decision making. The proposed Bill will allow all PPP operators to be free to fix their own tariffs in accordance with market conditions.

In a statement, the Union Shipping Ministry said “the role of Tariff Authority for Major Ports has been redefined. The Port Authority has now been given powers to fix tariffs which will act as a reference tariff for purposes of bidding for PPP projects”.

The Bill will also work to reduce the number of board members permitted on the Port Authority. The current number of 17-19 will now be cut to 11. The ministry believes that a condensed board, filled with professional and independent members will greatly improve strategic planning and decision making.  The new board structure is set to include representatives from the state government, Railways Ministry, Defence Ministry and Department of Revenue along with a member representing employees of the Major Ports Authority.

One of the major Bill impacts will be the allowance to let port authorities lease land for port-related use for 40 years, and non-port-related use for up to 20. Government approval is no longer needed for any leasing.

Analysts expect that these new changes will allow for much greater fluidity in the Indian industry, as well as sparking new interest in the Indian market from global terminal operators.

Earlier this year (2016), the Indian government in New Delhi signed an agreement to develop the Iranian Port of Chabahar.    

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