The concession and licence agreement for
developing the Vallarpadam international container transshipment terminal (ICTT)
at Vallarpadam in Kochi Port will be signed between the successful bidder, Dubai
Ports International (DPI), and the Cochin Port Trust, in Thiruvananthapuram on 7
February 2005.
Kerala Chief Minister, Mr Oommen Chandy, and the
Union Minister for Shipping, Road Transport & Highways, Mr T. R. Baalu,
would be present at the occasion.
DPI, the investment arm of the state-owned Dubai
Ports Authority, had emerged the successful bidder for developing and operating
the project on BOT basis for 30 years by quoting the highest revenue share of
33.30 per cent to the Port Trust.
The CCEA earlier this month approved the revised
draft licence agreement for the Rs.2,118-crore project. The ICTT will be
implemented through a special purpose vehicle, India Gateway Terminal Private
Ltd, a 100 per cent subsidiary of DPI to start with.
DPI plans to include in other shareholders into
the SPV by diluting its stake. However, DPI is stipulated to retain a minimum of
51 per cent equity in the terminal operating company. DPI has already decided to
induct a local entity, Chakiat Agencies Private Ltd, which will hold a small
stake in the SPV.
As per the plans, the Government will first hand
over the existing Rajiv Gandhi Container Terminal (RGCT) at the port to DPI for
handling container cargo. Within four years of starting operations at RGCT, DPI
will have to construct and shift operations to the ICTT, irrespective of the
traffic volumes.
Though DPI will transfer RGCT back to the Port
Trust after it commences operations its ICTT, the Government has undertaken not
to set up a competing facility for some more time to provide comfort to the
investor.
DPI will have complete monopoly over container
cargo handling at the Kochi Port until it handles 2.5 million TEUs at the ICTT.
Though the Government has not fixed a target for
DPI to handle transshipment cargo directly at the port, the operator will have
to handle 1 million TEUs (under certain conditions) within ten years of shifting
operations to the ICTT.
Yet another significant feature of the proposal
is that the CCEA has given an in-principle approval to provide rail/road
connectivity and deepening of the port channel to accommodate large main line
vessels of up to 8,000 TEUs at the container terminal at a total estimated cost
of Rs.843 crore.
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