Visakhapatnam Port is set to become a landlord port in a few years even as several trade unions are upping the ante against privatisation of berths.
The move to allot Ore Handling Complex (OHC) to private investors under Design, Build, Finance, Operate and Transfer (DBFOT) basis recently attracted severe criticism by some unions, who have threatened to knock at the doors of judiciary to stall the proposal.
The port, managed by Visakhapatnam Port Trust (VPT) under the Major Port Trusts Act, 1963, recently sought proposals for OHC mechanisation and upgradation at a cost of Rs.845 crore.
Sources told The Hindu that among those who responded to the global tenders were Essar and Vedanta. The clearance of Union Cabinet is required to finalise the concession agreement.
As part of Maritime Agenda-2020, the Ministry of Shipping wants to convert all the major ports into landlord ports. “In a few years, our job will be to become a landlord port and collect royalty from those who run the berths under DBFOT basis,” an official of Visakhapatnam Port pointed out.
Visakhapatnam Port, which is among 12 working major ports in the country, will be converted into a gateway port soon. It has several deep water basins. It serves a vast hinterland spread over Andhra Pradesh, Odisha, Maharashtra, Jharkhand and Chattisgarh.
It is envisaged that the port will have a capacity to handle 140 million tonne by 2016-17 and 149 million tonne by 2019-20. An investment of Rs.13,940 crore is mooted, of which Rs.7,100 crore will be funded through PPP route.
“OHC privatisation will put a question mark over the livelihood of several workers who depend on it. The admission by the port that OHC management does not come under core area of operations is against the spirit of Major Port Trusts Act. Privatisation will also defeat the objectives of contract labour abolition law for perennial type of works,” said former VPT trustee and BMS leader K. Bhavani Shankarudu.
United Port and Dock Employees’ Union general secretary V.S. Padmanabha Raju said VPT profits were falling due to landlord port concept.
“It received a royalty of Rs.11.53 crore during the period from 2005-06 to 2009-10 from private operators under BOT. This shows how our profits are dwindling,” he said.