Older port terminals to charge market rates: Panel formed
PORTS & SHIPPING

Older port terminals to charge market rates: Panel formed

Cargo handling terminals managed by private companies at major ports prior to the enactment of a new 2021 law governing state-owned ports are on the brink of gaining permission to apply market rates for their services. This landmark decision, seen as a game-changer in the ports sector, aims to balance the move towards market-driven pricing without violating existing concession agreements. The Ministry of Ports, Shipping, and Waterways has constituted a panel, led by Sanjay Sethi, Chairman of Jawaharlal Nehru Port Authority, to assess the feasibility of allowing older public-private-partnership (PPP) cargo terminal operators to adopt a market-driven pricing structure, similar to post-2021 operators.

The Major Port Authorities Act had originally empowered 11 state-run ports to determine market rates for new cargo terminals, leaving the fate of older handlers uncertain. The newly formed panel is tasked with formulating guidelines for transitioning these older cargo terminals to a market-driven rate framework, all while considering commercial aspects and port authority interests. This move aims to ensure that both the private operators' gains and the port authorities' benefits are fairly balanced.

Under consideration is a mechanism wherein older cargo terminals could charge market-based rates while adhering to the revenue share or royalty obligations outlined in concession agreements. This innovative approach aims to safeguard minimum throughput levels while enabling private operators to capitalise on market-driven rates. The potential for increased transparency is also on the horizon, with the requirement for terminals to display their market rates on their websites and provide advance notice of any rate revisions.

This significant policy shift is anticipated to level the playing field between different terminal operators while promoting viability and growth within the ports sector.

Cargo handling terminals managed by private companies at major ports prior to the enactment of a new 2021 law governing state-owned ports are on the brink of gaining permission to apply market rates for their services. This landmark decision, seen as a game-changer in the ports sector, aims to balance the move towards market-driven pricing without violating existing concession agreements. The Ministry of Ports, Shipping, and Waterways has constituted a panel, led by Sanjay Sethi, Chairman of Jawaharlal Nehru Port Authority, to assess the feasibility of allowing older public-private-partnership (PPP) cargo terminal operators to adopt a market-driven pricing structure, similar to post-2021 operators. The Major Port Authorities Act had originally empowered 11 state-run ports to determine market rates for new cargo terminals, leaving the fate of older handlers uncertain. The newly formed panel is tasked with formulating guidelines for transitioning these older cargo terminals to a market-driven rate framework, all while considering commercial aspects and port authority interests. This move aims to ensure that both the private operators' gains and the port authorities' benefits are fairly balanced. Under consideration is a mechanism wherein older cargo terminals could charge market-based rates while adhering to the revenue share or royalty obligations outlined in concession agreements. This innovative approach aims to safeguard minimum throughput levels while enabling private operators to capitalise on market-driven rates. The potential for increased transparency is also on the horizon, with the requirement for terminals to display their market rates on their websites and provide advance notice of any rate revisions. This significant policy shift is anticipated to level the playing field between different terminal operators while promoting viability and growth within the ports sector.

Related Stories

Gold Stories

Next Story
Infrastructure Urban

PMC Approves Rs 5.78 bn Waste Processing Contract

The Pune Municipal Corporation approved a Rs 5.7796 billion (bn) fifteen-year contract to process 500 metric tonnes (t) of waste daily at the Devachi Uruli depot and allowed unauthorised overhead cables to remain temporarily for one year subject to a fee. The decision was taken by the civic body to appoint a private operator for an integrated waste facility covering about 12 acres. The approval frames the contract as an operational arrangement with a fixed base rate and annual adjustments. The contract was awarded to Bhoomi Green Energy Envirocare LLP, which quoted Rs 772 per t, compared with ..

Next Story
Infrastructure Urban

Kerala High Court to Inspect Brahmapuram Waste Plant

Two judges of the Kerala High Court, Justice Bechu Kurian Thomas and Justice Gopinath P, will inspect the Brahmapuram waste management plant on 11 September as part of the suo motu proceeding on the plant's maintenance. The inspection was scheduled to allow the bench to assess conditions on site and to verify representations made by municipal and state authorities. The court listed the site visit during a hearing and directed officials to prepare for an on-site review. The bench instructed authorities to file a detailed report on the plant's present functioning ahead of the visit. It said the ..

Next Story
Infrastructure Transport

Ahmedabad Geetamandir Bus Port Terminal Two Ready with Airport Facilities

Ahmedabad’s Geetamandir Bus Port has completed a separate Terminal Two, which is ready to serve passengers travelling to Saurashtra-Kutch and North Gujarat. The facility has been developed with airport like facilities to improve passenger comfort and ease of travel. Deputy Chief Minister Harsh Sanghvi is scheduled to inaugurate the new terminal today. Authorities say the design focuses on smoother boarding and reduced congestion. Terminal Two will become operational from 13 August and is expected to handle 1,091 buses daily servicing routes to Saurashtra-Kutch and North Gujarat. The new arra..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement