Mormugao Port Authority, the state-owned entity that runs Mormugao Port, had called bids from private firms to redevelop Berth 9 along with three barge berths as well as operate and maintain Berths 10 and 11 at the western coast port.
Adani Ports and Special Economic Zone Ltd (APSEZ) and JSW Infrastructure Ltd are vying for two separate cargo handling contracts at Mormugao Port as the western coast port seeks private firms to run cargo handling facilities in line with the government’s plan to turn major ports into landlord ports under the new law that governs state-owned ports.
Mormugao Port Authority, the state-owned entity that runs Mormugao Port, had called bids from private firms to redevelop Berth 9 along with three barge berths having a capacity to handle 12 million tonnes (mt) of cargo with an investment of Rs842 crore on public-private partnership (PPP) basis.
The successful bidder will be allowed to handle iron ore and other cargo excluding containers, coal, and break bulk for 30 years.
The Berth 9 has not been operational since 2012 when the port authority dismantled the mechanised iron ore handling facilities such as stacker cum reclaimer and hopper loaders, after the Supreme Court banned the export of the steel making commodity from Goa.
The berth is occasionally used for handling granite and bauxite cargo while the three barge berths are used to park ships including those run by the Indian Coast Guard.
Mormugao Port, once India’s top iron ore exporting port, was hit by the ban on iron ore mining in Goa from October 2012 that drastically cut exports of the commodity through the port.
The ban has since been lifted by the court with certain conditions.
After months of delay, the Union government recently accorded security clearance to APSEZ and JSW Infrastructure, clearing the decks for the port authority to call price quotations for the project, officials said.
APSEZ, JSW Infrastructure and Delta Infralogistics (worldwide) Ltd have applied on a separate tender issued by Mormugao Port Authority to pick a private firm for operating and maintaining Berths 10 and 11 on PPP mode for 30 years.
The two projects are a part of the National Monetisation Pipeline (NMP) wherein operational infrastructure assets including port terminals will be privatised through the public-private-partnership (PPP) route.
Mormugao Port was the only major port that recorded negative growth in traffic during FY23. The cargo handled by Mormugao Port declined 6.2 percent to 17.319 mt in FY23 from 18.466 mt in FY22.
Berth 10 currently handles general cargo and Petroleum Oil and Lubricants (POL) while Berth 11 handles general cargo with a combined capacity of 6.4 mt.
The successful bidder will have to invest some Rs130 crore on equipment to handle cargo.
To attract a wider participation of bidders for privatising Berths 10 and 11, Mormugao Port Authority tweaked the qualification rules that allowed Delta Infralogistics, a stevedoring company, to apply on the tender, a port official said.
Stevedores are entities directly engaged by the exporters and importers based on competitive quotations to load and unload cargo from non-mechanised, common user berths run by the port authorities themselves.
These entities, though, will be hit by the government’s decision to allow PPP cargo operators to handle multiple commodities at their facilities – discarding the earlier practice of allowing handling of a single commodity.
Stevedores say they are keen to participate in the privatisation tenders issued by major port authorities to remain in business, but the qualification criteria stood in the way as it sets steep financial parameters on net worth, turnover, etc.
Under the Major Port Authorities Act, 2021, the publicly governed port authority acts as a regulatory body and as landlord while private firms carry out port operations, mainly cargo handling activities. The landlord port, in return, gets a share of the revenue from the private entities.
As all the cargo berths self-run by the port authorities are expected to be privatised, cargo previously handled by stevedores will be handled by PPP operators authorised to handle multi cargoes, drawing sharp criticism from stevedores.
“We made the qualification criteria for privatising Berths 10 and 11 to accommodate stevedores and enhance competition. Otherwise, the same set of entities were bidding for PPP projects,” the Mormugao Port official added.
The contracts will be awarded to the entity quoting the highest royalty on each ton of cargo handled at the berths to be shared with the port authority.
