PORT RESTRUCTURING IN A GLOBAL ECONOMY: AN INDIAN PERSPECTIVE

In 1991-92, India embarked on an ambitious economic reform programme aimed at transforming its inward looking, centrally planned economy into a market-driven economic system based on export-led growth. Since then, economic performance and international competitiveness have improved markedly. The country's external trade, currendy in excess of 250 million tons of cargo (exports and imports), is projected to nearly double by the year 2001. This confronts the port sector, on average already operating beyond capacity, with the significant challenge to sustain this growth in a seamless, cost effective and efficient way. Undoubtedly, this paramount pre-condition to Indian economic development will require significant effort towards port modernisation and coordinated port development. Currently, Indian ports are characterised by the existence of obsolete and poorly maintained equipment, hierarchical and bureaucratic management structures, excessive labour and, in general, an institutional framework that is considerably in variance with the Government's overall economic objectives. In the current 5-year plan, the Government of India has earmarked significant resources to port development which, however, fall short of requirements. Greater participation of the private sector is thus sought together with the accompanying institutional reforms. The latter should clearly define the "parameters" of port restructuring in a way that makes port investment in India an attractive business alternative to both national and international capital.