The Cochin Port Trust (CPT) now has some financial breathing space. The Cabinet Committee on Economic Affairs (CCEA) has approved waiver of a penal interest of nearly Rs.900 crore on Government of India loans worth Rs.168.15 crore availed by the port authority between 1936-37 and 1994-95.
The CPT had approached the Centre in July 2013 to restructure its liabilities with the government owing to its serious financial crisis. The approval of penal interest waiver is seen as a positive step, as it is expected to help the CPT leverage its healthier account books with its bankers.
The CCEA has also granted more time to the trust to start repayment. The rescheduled repayment of Rs.557 crore will begin in 2018-19, and it will be for a period of 10 years.
However, there is no end to the financial woes of the CPT, with its income being insufficient to meet the expenditure. The issue had turned acute with the commissioning of the International Container Transshipment Terminal (ICTT) in 2011. The cost of maintenance dredging for the terminal is around Rs.150 crore a year, whereas the CPT’s share of income from ICTT operations is not anywhere near its requirements.
Meanwhile, trade union sources said the Union government was fully aware of the efforts being made by the CPT management and employees to tide over the crisis.
A statement issued by the CCEA in New Delhi on Thursday said the Cabinet committee move had come in the wake of a series of steps taken by the CPT. “The Cochin Port has undertaken a series of remedial measures to improve its financial condition, apart from measures ordered by the Government of India, such as ban on recruitments, stoppage of vehicle purchases and the like. The measures adopted by the CPT include steps unprecedented in other major ports, such as freezing of variable DA for all employees and dearness relief for pensioners…,” the statement said.
