Refuting charges by former director of Rashtriya Ispat Nigam Limited Jagatpal and others, Gangavaram Port Limited has said the 15-year pact, which is not yet signed, gives RINL an option to exit whenever the company wants.
GPL Chief Financial Officer Pranav Choudhary told The Hindu that at present RINL, which runs Visakhapatnam Steel Plant, had the distinct advantage of getting a Greenfield fully automated port in its neighbourhood. RINL is importing its raw material on a vessel to vessel basis. Over past one and a half years, he said almost entire coking coal imports of RINL – around four million tonnes through 56 vessels had been handled at Gangavaram Port after being convinced that the landed cost for coking coal was the cheapest at GPL. “It is understood that RINL has saved over Rs.45 crores till date by using Gangavaram Port vis-à-vis the Visakhapatnam Port,” he said.
He said by virtue of exit option, RINL would have the right to terminate the agreement anytime when it was proved that Gangavaram Port was no longer competitive for RINL.
Mr. Choudhary said Visakhapatnam Port Trust (VPT), which is a major port under the aegis of Ministry of Shipping, had no cargo handling service.
“It works on landlord port concept, where RINL or any other port user had to contract with private stevedores or handling agents to unload and handle the vessel,” he said. “Therefore, it is a misconception that RINL cargo in the past was handled by Vizag Port – it was actually handled at Vizag Port by private contractors. It can be verified that RINL has no cargo handling contract with Vizag Port.”
On the resignation of Mr. Jagatpal in protest against bid to sign the agreement, he said “The resignation is also a result of confusion that our rivals and certain other competitive elements are trying to create so that for the sake of their own gains the conclusion of long-term service agreement between RINL and GPL gets delayed.”