The Union Cabinet on Friday approved a revised policy for the allocation of waterfront and associated land to Port Dependent Industries (PDIs) at major ports, aiming to enhance investor confidence, enable capacity expansion and improve operational flexibility.
According to an official statement, the updated framework allows existing captive users to develop additional berths, jetties, terminals or Single Buoy Moorings (SBMs) to meet enhanced captive requirements. Concession periods for such facilities can extend up to 30 years for government entities, reflecting evolving business and regulatory conditions.
Union Minister for Ports, Shipping and Waterways Sarbananda Sonowal said the move underscores the government’s intent to create a transparent and predictable ecosystem for port-led industrialisation. He described the revised Captive Policy as a reform that balances investor interests with public accountability by ensuring long-term certainty and facilitating capacity augmentation.
The policy enables major port authorities to renew or extend concession agreements of existing PDIs for up to 30 years without requiring fresh tenders. Renewals will be based on either the prevailing market rate or the indexed revenue share under the existing agreement, whichever is higher, thereby safeguarding port revenues while offering stability to operators.
A key feature of the revised framework is a structured mechanism for capacity expansion. Port authorities will undertake price discovery through competitive bidding, while granting existing concessionaires the Right of First Refusal (RoFR) to match the highest bid. Participation in such bids will be limited to eligible PDIs handling similar cargo profiles, ensuring both competition and continuity.
To prevent misuse of expansion provisions for tenure extension, the concession period for any additional infrastructure developed under expansion proposals will remain co-terminus with the existing facility’s maximum permissible concession period.
For the first time, the policy introduces provisions for allocating waterfront land to eligible government entities without competitive bidding, subject to defined safeguards and availability. These entities include central and state government departments, statutory bodies, autonomous institutions, and public sector undertakings, including joint ventures in sectors such as fertilisers, food, petroleum, oil and gas, coal and steel. Such allocations will be made at notified floor prices.
The revised policy also incorporates provisions for Change in Law and Unforeseen Events, allowing revisions in business plans and cargo profiles where external factors impact project viability. It further permits changes in cargo handling after the prescribed lock-in period, or earlier in case of regulatory shifts, ensuring business continuity in a dynamic trade environment.
The government stated that the updated framework addresses gaps in the 2016 policy by providing long-term clarity, enabling infrastructure expansion aligned with industrial demand and improving ease of doing business in the port sector.
The reforms are expected to catalyse fresh investments in port infrastructure, strengthen supply chains and reduce logistics risks for port-dependent industries. They are also likely to drive higher cargo throughput, improve utilisation of waterfront assets and generate sustained revenues for ports without any financial implications for the government.
The policy will be implemented across all major ports and is positioned as a key step in advancing India’s port-led development strategy.
