Committee recommends captive use policy for major ports

The Committee set up with officials from Union Ministry of Shipping and major port trusts members is likely to finalise its recommendations shortly to improve efficiencies at the ports.

One of the suggestions of the committee is the captive facility proposal which will allow major port trusts to handover water front or port facilities to a public or private enterprise on nomination basis without going through a competitive bidding process. Within captive use, port trusts have been asked to prefer an industry- or a commodity-specific facility (rather than a company-specific facility) as this will allow easier price discovery.

For a commodity-specific facility, the port can invite EoIs from firms dealing with that commodity by specifying minimum level of guaranteed cargo. The trust can then award the facility through the competitive bidding route to ensure maximum revenue to the port.

The traffic guarantee and revenue share guarantee over a 30-year period will be the parameters on which the competitive bidding can be done.

In case a captive facility is not fully utilised during the concession period, the port shall have the right to allow other users to use the facility and also collect charges from the latter. The berth hire charges shall be collected by the port and passed on to the captive user. However, if the berth is constructed by the port trust, the port can keep the charges.


Source : ProjectsToday

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