The Hindu Business Line : Mumbai port's surplus funds mooted to develop Vallarpadam project

After two attempts to involve private participation failed to elicit desirable response, the best course now is to allow Port Trusts having surplus funds to invest in viable projects of other ports.

Kochi , Jan. 6

THE Water Transport Workers Federation of India has mooted the idea of setting up the container transhipment terminal project at Vallarpadam on a joint initiative in association with the Mumbai Port Trust as was suggested by the Union Government in 2002.

The Mumbai Port has Rs 4,000 crore of surplus funds and at one stage, the Shipping Ministry had suggested usage of surplus funds for funding the Kochi's container transhipment terminal project. This approach has, however, undergone a change and the best thing now is to pursue this course of action, the Federation President, Mr M.M. Lawrence said.

Considering that the two attempts to involve private participation for the Vallarpadam project having failed to elicit desirable response, the best course now is to allow Port Trusts having surplus funds to invest in viable port projects of other ports. This approach has proven success in JNPT, which was promoted by the investment support from Mumbai Port, Mr Lawrence said in a letter to the Kochi Port Chairman.

The Federation also appreciated the Chairman's efforts in getting a speedy approval from the Government for budgetary support for creation of supporting infrastructure such as rail/road connections and deepening of the channel prior to the implementation of the transhipment terminal project. The Federation, however, warned that the latest move to heed to the dictates of bidders, such as allowing longer term for BOT contract exceeding 30 years and transferring the existing container terminal to the private party, does not augur well.

The Indian experience of port privatisation has indicated the need for laying down of clear objectives and well-defined means to achieve them. When growth of traffic is envisaged in a port, concession to a private operator on BOT to build competing terminals is the accepted norm in leading ports. Such proven method is suitable for adoption in India. There would be no need to transfer a public terminal to a private operator in the normal course, he added.