AN ANALYSIS OF IMPACT OF INDIAN GOVERNMENT
ON PORTS IN INDIA

The construction of port infrastructure and acquisition of new equipment is a capital intensive activity. As such, most port projects rely on the government for support. The aim of this study was to investigate the impact of the Indian government on the Indian Port Sector. The study was guided by three objectives: to investigate the impact of the Indian government on port modernization on the Indian Port Sector, to find out how the Indian government has influenced new port development in the Indian Port Sector, and to determine the effect of the Indian government policies on FDI on the Indian Port Sector. The methodology used both primary and secondary methods. The primary methods involved administering questionnaires to 70 staff members in the port of Mumbai and JNPT port. Interviewees were also conducted on four port authorities. Also, secondary sources were used to re-analyse already existing information. Analysis of data was done using SPSS statistical software and recursive abstraction for the interviewees. The findings of the study show that the Indian government has positively impacted on the Indian port sector by attracting foreign investors, modernising new ports and the development of new ports.

List of figures
Figure 1: Conceptual framework 21
Figure 2: Research onion 23
Figure 3: Cargo traffic at non-major ports 33
Figure 4: Fiscal year throughput at major India Ports 35
Figure 5: Traffic handled by major and minor ports 36
Figure 6: Throughput of major ports in India 37
Figure 7: Foreign Direct Investment in Ports 39

List of tables
Table 1: Timescale 30
Table 2: Response according to gender 41
Table 3: Response according to age 42
Table 4: Response according to the impact of the government on new port development 44
Table 5: Response according to whether the government policy of 100% FDI in automatic route has improved port infrastructure 45
Table 6: Response according to the impact of the government on port modernization 46
Table 7: Response on factors that limit the growth of the Indian port sector 47
Table 8: Response on poor technology in the port sector 47
Table 9: Response on ownership by the government 48
Table 10: Response on inadequate cargo-handling and machinery 48
Table 11: Responses on inefficiency due to poor connectivity through ports 49
Table 12: Interviewee profile 50

Table of contents
Contents
Abstract 2
List of figures 3
List of tables 3
Table of contents 3
CHAPTER 1: INTRODUCTION 6
1.1 Background information 6
1.2 Justification 7
1.3 Rationale of Research 8
1.4 Research Aim and objectives 8
1.5 Scope and limitations of the Study 8
1.6 Structure of this dissertation 9
CHAPTER TWO: LITERATURE REVIEW 10
2.2 Conceptual review 10
2.2.1 The nature of the port sector 10
2.2.2 Port modernization and the impact of the government 10
2.2.3 New port development and the impact of the government 12
2.2.4 FDI in port sector and the impact of the government 13
2.3 Theoretical review 15
2.3.1 Modernization theory 15
2.3.2 Solow-Swan Model 16
2.4 Empirical review 17
2.5 Gaps in literature 20
2.6 Conceptual framework 21
2.7 Chapter summary 21
CHAPTER THREE: METHODOLOGY 23
3.1 Chapter introduction 23
3.2 Research philosophy 23
3.3. Research approach 24
3.4 Research strategy 25
3.5 Time horizon 25
3.6 Research choice 25
3.6 Data collection and presentation 26
3.6.2 Sampling technique 26
3.6.2 Questionnaires 27
3.6.3 Interviews 27
3.6.4 Secondary sources 27
3.6.4 Data analysis 28
3.7 Limitations, validity and reliability 29
3.8 Ethical considerations 29
3.9 Timescale 30
CHAPTER 4: ANALYSIS AND PRESENTATION OF FINDINGS (secondary data) 31
4.1 Chapter introduction 31
4.2 The Indian Port Sector 31
4.3 The impact of the Indian government on port modernization on the Indian Port Sector 32
4.4 Indian government has influenced new port development in the Indian Port Sector 34
4.5 The effect of the Indian government policies on FDI on the Indian Port Sector 37
4.6 Chapter summary 40
CHAPTER 5 (a): DATA ANALYSIS AND PRESENTATION OF FINDINGS: QUESTIONNAIRES 41
5.1 Chapter introduction 41
5.2 Response rate 41
5.2.1 Response according to gender 41
5.2.2 Response according to age 42
5.3 Response according to the impact of the government on new port development 43
5.4 Response according to whether the government policy of 100% FDI in automatic route has improved port infrastructure 44
5.5 Response according to the impact of the government on port modernization 46
5.6 Response on factors that limit the growth of the Indian port sector 46
CHAPTER 5 (b): DATA ANALYSIS AND PRESENTATION OF FINDINGS: INTERVIEWS 50
5.1 Interviewee profile 50
5.2 Response on the challenges and opportunities in the Indian Port Sector 50
5.3 Respondents view on the government policy of 100% FDI in the port sector 52
5.4 Responses on the impact of government initiatives to modernize ports 53
5.5 Respondents view on whether the government’s plan to develop new ports will help the port industry 54
5.6 Response according to how has the government impacted on you port 55
5.7 Chapter summary 56
CHAPTER 6: SUMMARIES, CONCLUSIONS AND RECCOMENDATIONS 56
6.1 Summaries 56
6.2 Conclusions (Answers to research questions) 58
6.3 Recommendations 60
6.4 Suggestions for future research 62
Reference list 63
APPENDIX 1: QUESTIONNAIRE 71
APPENDIX 2: INTERVIEWS 73

CHAPTER 1: INTRODUCTION
1.1 Background information
The recent improvement in technology and infrastructure has resulted in the development of better and modern ports in a majority of nations. The port sector as per Ng and Gujar (2009) refers to a location in the shore where ships dock and carry cargo and people to and from the land. The location of ports depends on the accessibility to land and water for shelter from waves and also for commercial demand. The port sector is a major economic contributor to most countries. It is this notion that countries are now opting for ways to enhance their ports and reap from the new technology. However, Panigrahi and Pradhan (2012) argue that development and improvement of ports often requires huge sums of money that can only be provided through government initiatives. The main areas in the port sector that promote the effectiveness of ports are port modernisation, development of new ports and attraction of foreigners with the aim of improving infrastructure.
Port modernization is the improvement of the existing port infrastructure and technology to incorporate modern machines, tools and technology solutions such as RFID (Sanchez and Garcia-Alonso, 2011). On the other hand, when it is impossible to modernize old ports or due to traffic reasons, the only option is to develop new ports. Development of new ports is advantageous in that it reduces traffic, allows for the incorporation of new technology and improves cargo handling among others (Joc.com, 2017). Besides new port development and port modernisation, it is also vital to attract foreign investors in the port sector as they encourage technological transfers and recommend better infrastructure (Lam and Notteboom, 2014). As earlier stated, these operations often depend on government policies or government budget because they are capital intensive. It is on this notion that this paper discusses the impact of government initiatives of foreign Direct Investment, port modernization and new port development in the port sector.
India has been selected as a case study because its coastline spans 7516.6 kilometres forming one of the biggest peninsulas in the globe (Panigrahi and Pradhan, 2012). Besides that India is currently in the face of improving its port sector. Besides that, the Indian shipping industry with the emergence of liberalization and globalization is firmly ready to take a new turn in terms of infrastructural and demand development (Lam and Notteboom, 2014). The aim of this study is to investigate how the Indian government has impact on FDI, port modernization and new port development in the Indian Port Sector.
1.2 Justification
While it’s true that the shipping industry is a major economic sector in India, it remains not fully untapped. According to Kirubakaran (2010), increasing connectivity with inland transport network is a huge challenge facing Indian Port Sector. Then there is the issue of traffic that was estimated to reach 877 million tonnes in 2012 and a 15.5% of containerized cargo over the next seven years. The current infrastructure in Indian ports is not sufficient to handle increased loads. This implies that expansion of the Indian Port Sector is a necessary prerequisite to further economic growth. It is, therefore, necessary to critically investigate what the Indian Government is doing to address this issues. Besides that, there exists gap in the literature on this topic. Previous researchers majorly focussed on issues affecting Indian Port Sector and failed to assess government initiatives. For example, Haralambides and Behrens (2000) researched on Indian port restructuring, while Gujar et al. (2014) only studied the impact of government policies on FDI on Indian Port Sector. Although Ng and Gujar (2009) investigated on efficiency and competitiveness of government policies on Indian dry ports, they did not talk much about the effect of these policies on the port sector. As such, there are no holistic studies on the impact of the government on the Indian Port Sector. The current study aims to fill this gap.
1.3 Rationale of Research
This research is significant as it will enable port authorities to identify the impact of government initiatives in form of port modernization, development of new ports and foreign investors. Additionally, it will help both the government officials and the port authorities to identify the issues faced in the Indian Port Sector and come up with more policies to improve infrastructure in this sector. The research is vital because it will enable Port operators to appreciate the vitality of the Indian Port Sector and rekindle the motivation of striving to improve the services in this sector. Additionally, the final report of this study will be used as a reference for the government and port authorities as they learn ways of improving the Indian Port Sector.
1.4 Research Aim and objectives
The aim of this study is to investigate the impact of Indian government on ports in India.
This study will be guided by the following objectives:
1. To investigate the impact of the Indian government on port modernization on the Indian Port Sector.
2. To find out how the Indian government has influenced new port development in the Indian Port Sector
3. To determine the effect of the Indian government policies on FDI on the Indian Port Sector.
1.5 Scope and limitations of the Study
The study will be limited by both thematic and geographic factors. Thematic scope means that the researcher will only focus on the government and the port sector. All other factors that affect the port sector will not be discussed. As such, the researcher will only focus on the impact of government on the port sector. Geographically, the study will be limited to India; India is one of the Asian countries located in South Asia. All other countries whose governments have influenced the port sector will not be studied.
The researcher intends to use both primary and secondary data collection method. Primary data collection involves using interviews and questionnaires as instruments of data collection. Preparing and administering questionnaires and interviews is both time consuming and resource based. This limitation will be delimited by sourcing products from the most affordable providers and only buy the necessary items to avoid financial problems. Then there is the problem of uncooperative respondents. It will be solved by educating the participants of the vitality of the study to both the government and the port sector.
1.6 Structure of this dissertation
This dissertation will be organized into five sections that will be referred to as ‘chapters.’ The first chapter is the introduction chapter which discusses the background information on the topic and states the problem to be addressed. Previous researches on the same topic, relevant theories that explain variables, explanation of concepts and determination of the gaps that exist in literature will be discussed in chapter 2. Chapter three will involve the methods used to carry out the research and findings will be presented in the fourth chapter. Analysis of secondary and primary data will be done in chapter 5. The final section will entail summaries of the major findings, conclusions (answers to research questions) and recommendations for future researchers.