Shipping Ministry to award projects worth Rs 13,000 crore under PPP mode

NEW DELHI: The shipping ministry plans to award seven projects, worth Rs 13,000 crore, under the public-private partnership mode in the next three months, as it rushes to kick-start capacity addition at ports in the current fiscal. Four of them were to be awarded in the first quarter but were held up for want of security and environmental clearances. For FY12, the government aims to award 23 PPP projects worth Rs 16,700 crore in 2011-12 , adding 230 mt to India's yearly cargo handling capacity of 1 billion tonnes.

Although the ministry adopted a new model concession agreement in 2008, it could award only 13 projects in 2009-10 and just nine in 2010-11 . “We could not award any project in the first quarter due to some issues,” said a ministry official, admitting his department's failure in securing approvals. According to project calendar , the four projects would have created an annual capacity of 75 million tonnes at an estimated cost of Rs 5,700 crore. While the installation of mechanised handling facilities at the Vishakhapatnam port was delayed because of pending security approvals, the construction for the mega container terminal at the Chennai port could not begin as it could not get environmental clearance. The other two projects include development of a dry bulk terminal at the
Kandla port.

In the second quarter, the government plans to award three projects of Rs 7,500 crore. These will include development of fourth container terminal at Jawaharlal Nehru Port, a multi-user liquid terminal at Kochi and a container terminal at the Tuticorin Port. These projects will add a yearly capacity of about 80 mt. “Issues like environmental clearance absence of a regulatory authority at the national level are some of the problems while awarding PPP projects ,” said Samir Kanabar, partner, Infrastructure Practice , at Ernst and Young India.