Kanpur Logistics Park Pvt Ltd, a unit of Pristine Logistics & Infraprojects Ltd, has quoted a negative 52 percent rate to win the bid for building a Gati Shakti multi modal cargo terminal at New Bhaupur near Kanpur in the first tender floated by the Railways Ministry after introducing a new rule for awarding bids to develop such facilities on Indian Railways land.
The negative 52 percent rate placed by Kanpur Logistics Park would mean that the private operator will not seek any share of the Terminal Charges (TC) and Terminal Access Charges (TAC) from the Dedicated Freight Corridor Corporation of India Ltd (DFCCIL)/Indian Railways in running the facility. Over and above this, it has offered to pay an amount equivalent to 52 percent of the TC and TAC to the DFCCIL/Indian Railways, officials briefed on the bid said.
The Terminal Charges and Terminal Access Charges are levied by Indian Railways at its goods sheds/container rail terminals: when cargo comes on Railways-owned wagons, TC of Rs20 per ton (for bulk cargo) is collected and when it arrives on privately-owned wagons, TAC of Rs1.6 lakh per rake (for containers) per entry is billed.
For Gati Shakti cargo terminals set up entirely or partially on India Railways land, Railway will levy Terminal Charges and Terminal Access Charges similar to those being levied on Railways goods-sheds. These Terminal Charges and Terminal Access Charges will be shared with the Gati Shakti Cargo Terminal Operator (GCTO) according to the percentage quoted in the tender.
Bidders have to quote the percentage of Terminal Charges and Terminal Access Charges which they seek to claim from the India Railways for the traffic handled at the terminal, according to the criteria previously followed for deciding the tenders. The percentage offered has to be similar for both TC and TAC.
In the initial tenders for Gati Shakti multi modal cargo terminals, the contracts were awarded to the bidder quoting the minimum percentage share or claiming the least share in TC and TAC from DFCCIL/Indian Railways.
If two or more bidders quoted the same percentage share, the decision to award the contract will be taken through a draw of lots.
Under the new criteria for awarding bids, a bidder can let the DFCCIL/Indian Railways retain the entire TC and TAC without seeking any share on this account. Besides, it can share a percentage of the TC and TAC to DFCCIL/Indian Railways out of the revenue accruing from infrastructure and value-added services provided at the terminal.
To illustrate the bid of Kanpur Logistics Park, it is not seeking any share from DFCCIL/Indian Railways on the TC of Rs20 per ton and TAC of Rs1.6 lakh per rake/per terminal – the full TC and TAC will be retained by DFCCIL/Indian Railways.
Over and above this, it has agreed to share 52 percent of the TC of Rs 20 per ton and TAC of Rs1.6 lakh per rake/per terminal to DFCCIL/Indian Railways.
New Bhaupur Cargo Terminal Pvt Ltd, the only other bidder to place a price bid, quoted a rate of 52.35 percent, indicating that it will retain 52.35 percent of the TC and TAC while the balance will be allocated to DFCCIL/Indian Railways.
Kanpur Logistics Park, according to railway industry sources, has placed an aggressive bid to win the Gati Shakti multi modal cargo terminal at New Bhaupur to check competition and retain its market share in the Kanpur catchment area.
Pristine Logistics & Infraprojects runs a 1,08,000 twenty-foot equivalent units (TEUs) capacity terminal at Kanpur which has a market share of about 75 percent in the area and is one of the major cash cows of the company. The only other competitor, State-owned Container Corporation of India Ltd (CONCOR), has the balance market share.
The New Bhaupur terminal to be built on 17.8 acres of Railways land, will run close to the planned Eastern Dedicated Freight Corridor.
In February this year, Pristine Logistics and Infraprojects won a deal to set up India’s first Gati Shakti Multi Modal Cargo Terminal of DFCCIL at New Rewari by quoting ‘NIL’ share on Terminal Access Charges, thereby allowing Indian Railways to retain the full TAC.
New Rewari is also India’s first terminal awarded by DFCCIL for the movement of single/double stack container trains daily, connecting the National Capital Region Delhi to the major gateway ports of Mundra and Pipavav.
In the case of at least three recent Gati Shakti Cargo Terminal tenders, including the one planned at Sankrail Goods Terminal Yard near Kolkata some 18 kms from Howrah, to be developed on 120 acres of Railway land, all the three bidders quoted a rate of 99.97 percent, indicating their willingness to let the DFCCIL/Indian Railways retain the entire TC and TAC.
“This resulted in a tie and in such cases, per the tender document, the bid is to be decided through a draw of lots. But many felt that this would be a funny way of finalising the tender,” said an industry source briefed on the matter.
This had put the Indian Railways in a fix on how to decide tenders and forced a change in the criteria for awarding bids.
