Shipping ministry to underutilise budgetary funds yet again

The shipping ministry is unlikely to utilise the budgetary support fund for infrastructure enhancement at the 13 major ports in the current fiscal fully, for the third year in a row now.

Of the Rs1,677 crore outlay for the current fiscal, the ministry has been able to use only 19% at Rs325 crore in the April-August period.

The 13 major ports, having 530 million tonne (mt) capacity, are directly under the ministry of shipping. In 2008-09 as well, the major ports could not utilise the funds, spending only `888 crore against the sanctioned Rs1,386 crore. In 2007-08, the ministry could spend Rs646 crore of the Rs950 crore outlay.

Jawaharlal Nehru Port (JNPT), Paradip port and Chennai port are among those that showed poor utilisation of the budgetary allocation. In 2008-09, JNPT managed to spend Rs48.77 crore against the sanctioned Rs175 crore. In the same year, Chennai port managed to utilise Rs49 crore compared with the allocation of Rs73 crore. Paradip port could use only Rs101.47 crore against an outlay of Rs288 crore.

The ministry, in its reply to the Parliamentary Committee on estimates, attributed the underutilisation of funds to non-standard contracts, as well as, infirmities in the tender documents, among others.

“The reasons for variations include inadequate response to tenders, time taken to obtain approvals from other ministries,” said the ministry. The ministry also informed that a committee formed to address the issues has recommended reduction in stages of approval. Going forward, the ministry is considering delegating more powers to the port trust boards for award of contracts.

On the public-private partnership (PPP) front, too, the port sector has not shown much movement. In the current fiscal, till date, only two projects worth Rs1,100 crore have been awarded, against a target of awards worth Rs14,000 crore. In 2009-10, 13 projects worth Rs2,700 crore adding 66 million tonne were awarded.