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West Bengal CM is looking to boost ‘reformer’ credentials with Tajpur Port project

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KOLKATA : West Bengal Chief Minister Smt Mamata Banerjee is looking for non-public funding to construct a greenfield port at Tajpur in West Bengal’s Purba Medinipur district, on a concession interval of 99 years, one thing that neither the Centre nor any coastal state has ever tried, because the chief minister tries to shake off her investor unfriendly picture with a watch on pan-India political ambitions.

The bid can be selected the idea of the best premium internet current worth (NPV) provided by a bidder to the State authorities, by following a technique that has not but been adopted elsewhere in India’s port privatisation programme.

Based on the tender phrases, bidders can be required to cite the royalty fee per metric tonne (mt) for cargo dealt with on the port, no matter the cargo kind or commodity. Moreover, they’ve to point the cargo visitors projections for seven years, ranging from the royalty graduation date.

The undertaking can be awarded to the bidder whose monetary bid (royalty fee and cargo throughput estimates) leads to the best NPV to the federal government.

The State authorities will switch 126 acres of land on lease to the profitable bidder for creating the port. It is going to additionally switch an extra 1,000 acres of land on lease to the port developer for port property improvement. The port developer can be allowed to undertake property improvement for business functions on the port property improvement web site, with the appropriate to sub-lease/ assign all or any components thereof.

The possession of the land, although, will vest with the State authorities always.

Constructing new ports with non-public funds added higher sheen to the profile of the then Gujarat Chief Minister Shri Narendra Modi when he pursued a nationwide function in politics. Gujarat is now India’s greatest state by way of cargo dealt with by non-public ports which are outdoors the management of the Central Authorities.

In Gujarat, the port concessions have up to now been awarded to personal companies for 30 years. For a, The Gujarat authorities, although, is trying to award the brand new port at Nargol for 50 years.

Different states corresponding to Andhra Pradesh, have usually adopted a 30-year preliminary concession interval for port initiatives, which will be prolonged by two phrases of 10 years every.

“A concession interval of 99 years offers a cushion to the port developer,” mentioned a prime official with a port working firm. “The longer the concession interval, extra the chance for the port developer. Land lease for 99 years is pretty much as good as possession. It won’t solely assist develop the port, but additionally actual property infrastructure,” he mentioned.

West Bengal is amongst three of eight coastal states that haven’t developed a non-major port with non-public funds. The State and its hinterland depend on the more-than-century-old riverine port of Kolkata – owned by the Central authorities – for export-import wants.

Earlier makes an attempt to construct new port

Tajpur was not the primary option to construct a brand new port within the State, to offer customers an “alternate choice” to deal with their cargo given the infrastructure challenges at Kolkata Port Belief.

The Centre had recognized Sagar Island for the brand new port and even notified it as a significant port in 2016. A particular function automobile named Bhor Sagar Port Ltd was set as much as construct the brand new port, with the Kolkata Port Belief holding 74 per cent fairness and the West Bengal authorities the rest.

The Public Funding Board authorized a ₹515-crore grant/ subsidy to Bhor Sagar Port Ltd for reclaiming land, dredging and erecting fundamental infrastructure for the brand new port. A proposal was drafted to safe Cupboard approval for the grant/ scheme.

At this juncture, the West Bengal government-led by Mamata Banerjee swung into motion to take up the Tajpur undertaking as a state authorities undertaking.

The Centre made a futile try and develop Tajpur port as a central sector undertaking by looking for an assurance from the West Bengal authorities “to offer a so-called proper of first refusal to Bhor Sagar Port Ltd in case it determined to arrange a brand new port within the State”.

However this was not acceptable to the State authorities because it meant giving a 74 per cent stake to the Centre for creating Tajpur.

Alternative for Mamata Banerjee

Years in the past, when the Tata Group fled the State following strident opposition from the Trinamool Congress to its ‘Nano’ small automobile undertaking, Modi moved swiftly to facilitate the automobile plant at Sanand, drawing a lot appreciation from the trade, together with from Ratan Tata.

“Is she makes Tajpur a actuality, then it might go a great distance in refurbishing her picture. The Singur episode was an enormous blot on her,” mentioned a port trade advisor.

“Actuality means you lead the street reveals, choose a port developer, construction the undertaking, oversee its building and make it operational. This might point out that West Bengal means enterprise,” he mentioned.

Tajpur, in line with one other professional, will face robust competitors from Subarnarekha port deliberate by Tata Metal Ltd, in neighbouring Odisha.

“For my part, between Tajpur and Subarnarekha inexperienced area ports, just one undertaking is adequate. In case, the West Bengal authorities is ready to appeal to both SAIL, JSW or Adani as developer of the undertaking forward of the monetary closure of Subarnarekha port undertaking, Tajpur may change into extra engaging and would have a optimistic influence on the State authorities. For this, the West Bengal authorities should act quick, much like the Andhra Pradesh authorities, which awarded the Ramaypatnam Port EPC contract in report time,” mentioned Ramesh Singhal, Director at i-maritime Consultancy Pvt Ltd.

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