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Adani, DP World may join Nargol Greenfield Port race

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AHMEDABAD : The greenfield port at Nargol in Gujarat has caught the attention of many. Port Operators such as DP World, Adani Ports and Special Economic Zone (APSEZ), Essar Group, and JM Baxi Group have evinced interest in the project.

The pre-bid assembly held earlier this week also saw the participation of the 4 companies, sources in the know of the development, informed.

Worldwide Cargo Terminals and Infrastructure Pvt Ltd (ICTIPL), a JM Baxi Group firm, and DP World participated in the pre-bid assembly online while the senior representatives of Adani Group and Ruias-controlled Essar Ports Ltd attended in person. The assembly was called by the Gujarat Maritime Board (GMB), the state maritime regulator, stated a senior authority official.

The event of the proposed Nargol port was recently put on fast track by the state authorities after the GMB cancelled the contract given to Cargo Motors for the event of the port. The prime reason for the same was the corporate’s inefficiency in meeting the deadlines of the project. 

After the cancellation of the contract, the federal government has now decided to give the project a fresh start and invested international bids to develop Nargol port with preliminary funding of INR 3,800 crore.

This move comes at a time when the central authorities are already engaged in the development of a major port with estimated funding of INR 65,000 crore at Vadhavan in Maharashtra.

Both Adani and Essar Group have confirmed their active participation in the pre-bid assembly of the port.

The maritime board officers have confronted about 200 queries from the pre-bid assembly members however the officers didn’t reply instantly.

One of the many members presents said, “Not a single question was answered. The GMB officers later assured us that they are going to publish replies to all our queries online by the tip of this month.” 

“However then what was the purpose of calling a pre-bid assembly when all of the members had submitted their queries by mail?”, he questioned. 

While the federal government may seem serious about the implementation of the project, there are numerous areas of concern within the RFP (request for proposal) doc, stated an official working with a port developer. The official added that the federal government ought to provide you with options, failing which builders might start questioning the viability of the challenge.

The bidding process for a greenfield port in Gujarat has come after almost 9 years. Earlier, the bidding was achieved by providing a limited flooring of over 100% for waterfront royalty costs. Within the case of Modhawa port, the bottom restrict was as excessive as 127%.

As far as the primary time for Nargol port is concerned, the GMB for the first time has provided a reduction of 20% for the waterfront costs in step with its Schedule of Port Prices (SoPC). 

Along with this, the concession interval beneath the state’s build-operate-own-transfer (BOOT) coverage has been prolonged from 30 years to 50 years.

 “One of many main areas of concern for the builders is that after the completion of fifty years, the builders should switch all of the rights of the port to the federal government,” stated a trade knowledgeable.

He further added, “There will likely be no consideration for the e-book worth and even the depreciated worth of the property. Below these circumstances, a port developer might cease making recent investments after a few a long time.”

Another space of concern lies in the expenditure that the developer will have to borne in developing street and rail infrastructure. This expense is above and over the INR 3,800 crore port improvement value.

“Any change within the lease leases will affect the feasibility of the port and therefore we request the GMB to make sure that the present land lease coverage will likely be relevant all through the BOOT interval,” DP World stated in one of its queries. 

The Dubai-based infrastructure developer has submitted more than 100 queries to the GMB.

Source : Times of India

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