Privatization of ports - framework for governmental action

Abstract

Given the delays and congestions at ports, leading to extensive demurrage charges for ships, a lot of attention on improving port productivity through better management systems and infrastructure developments are being considered. Privatization of ports at various levels is being proposed as a structural solution. The Government of India as well as many of the coastal states in India are examining this issue rather seriously. The author has been involved in a study for a state with a large coastline having over forty notified ports, on this issue of privatization. The objectives of this study were to examine and recommend (a) Which of the present ports should be privatized? (b) Possible locations for future privately owned ports based on traffic considerations. (c) Which of the port-related services should be privatized? (d) The terms and conditions for selecting the parties for private ownership and/or provision of services. (e) The process of smooth implementation of privatization. As part of the methodology, the author also studied the experiences of a few countries abroad as well as nearly 10 major ports spread all over the country. This paper reports on this study and the development of a conceptual framework for governmental action for privatization of ports.