Financial Daily from THE HINDU group of publications
Thursday, Feb 07, 2002
Govt to re-tender Vallarpadam box transhipment project
NEW DELHI, Feb. 6
THE Union Government has decided to re-tender the long-pending Vallarpadam container transhipment project at the Kochi port, cancelling the lone price bid submitted by P&O Ports for developing the project in 1999, according to the Union Minister of Shipping, Mr Vedprakash P. Goyal.
"We are going ahead with the plan for re-tendering the Vallarpadam project. This will be a limited tender open to a few companies who had agreed to participate if the project is re-tendered,'' Mr Goyal told Business Line here on Wednesday on his return from a week-long tour of Hong Kong, Malaysia and Singapore to market the project.
The three-nation tour was planned as a road show to sell the project and the Minister was accompanied by the Shipping Secretary, Mr M.P. Pinto and the Chairman of Kochi Port Trust, Dr Jacob Thomas.
"The response to the road show was very good. Big private entities such as CSX Corporation, Hutchison Port Holdings and PSA Corporation have agreed to participate in the re-tendering process. Altogether, about six major private port operators will bid for the project,'' Mr Goyal said.
The Union Shipping Ministry would start the work on seeking Cabinet approval for re-tendering the project without resorting to the open tender route, Mr Goyal said.
The Shipping Minister discounted the possibility of P&O Ports resorting to legal action for cancelling its lone bid for developing the project.
"In all cases of open tender, the Union Government always reserves the right to reject the bid without assigning any reasons. That right is always with the Government,'' he noted.
In any case, the lone bidder did not drag the Government to court after the bid was submitted about two years ago, Mr Goyal said.
After obtaining the Cabinet nod, the Shipping Ministry will ask the Kochi Port Trust to invite proposal from those who are interested in the project.
Subsequently, the bidders would be asked to submit their financial bids on the basis of a set of non-negotiable terms and conditions and a package of guarantees to be provided by the bidder, framed by the Union Government.
The Rs 1,873-crore Vallarpadam project is now expected to be re-tendered as a full-fledged build, operate and transfer (BOT) project using the revenue sharing format as the basis for selecting the private developer.
P&O Ports will not be allowed to participate in the project because of its involvement in developing the nearby Colombo container terminal.
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