‘Landlord port model will benefit corporates at expense of workers’
The value of ports' assets is being reduced by almost one-third to benefit corporates. This is a big loot of national property: WTWFI
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Visakhapatnam: CITU-affiliated Water Transport Workers' Federation India (WTWFI) national general secretary T Narendra Rao said the decision of the Ministry of Ports, Shipping and Waterways to transform all the 12 major ports into landlord ports is counter-productive.
"The Major Ports Act, 2021 paved the way for 12 major ports to become landlord ports by virtue of which the port authorities will not invest in capacity augmentation thereby making them survive on meagre collection of royalty from the PPP/BOT operators," he told Bizz Buzz and cited the case of container terminal at Jawaharlal Nehru Port Authority (JNPA).
He said the major ports in Visakhapatnam, Mumbai, Chennai, Kolkata and Paradip are also incurring huge losses due to pressure being exerted on them to privatise various assets or create new facilities. Existing facilities are also being given on O&M contract basis.
Rao, who is the convener of Coordination Committee of Joint Trade Unions of Chennai Port, said "JNPA became the first landlord port by privatising the container terminal which was owned and managed by the port administration. Under the PPP mode, it was given for a meagre amount of Rs 863 crore whereas the port-based value is estimated at Rs 1295 crore. Out of 1300 employees, half are being made surplus."
Referring to the decision to privatise assets worth Rs 6 lakh crore under the National Monetisation Pipeline (NMP), he said the target set for four years to privatise assets in major ports amounting to Rs 12,828 crore is also being increased. Private participation is being sought for additional berths, mechanisation, oil jetties, container terminals and marinas. Of late, Visakhapatnam Port Authority with funding from Ministry of Tourism developed an international cruise terminal by spending nearly Rs 100 crore and a decision has already been taken to give it to a private operator on O&M contract.
Rao said to allow private parties under PPP/BOT route under landlord port model, the value of assets is being reduced by almost one-third of the actual value. "It is a big loot of national property. It clearly shows the government's resolve to benefit private corporates at any cost."
Incentives offered to terminal operators and concessionaires seriously affected the financial health of the major ports which are incurring huge financial liabilities towards wages and pension benefits. The concession offered to the private parties has no justification as majority of ports suffered huge losses during the pandemic. Under the NMP cargo handling terminals will be handed over to the corporates on a golden platter, he alleged.
"We cannot expect that the major ports will get their due share through the monetisation process as the ports will remain their junior partners of PPP/BOT firm sharing a small part of the revenue earned by the asset-holding companies. Notably, the asset valuation mechanism is also faulty as it encourages reduced royalty for extending the concession/contract. This will lead to heavy loss of permanent jobs and denial of legitimate benefits," he stated.
He also criticised the BJP-led NDA Government for releasing the revised model concession agreement to make it flexible to private companies so that the port projects will benefit them a lot. Instead of port authorities fixing the minimum guaranteed throughput, the freedom to finalise it is vested with the PPP/BOT operator, he remarked.
Rao said while the authorities are busy in holding roadshows for the Global Maritime India Summit (GMIS), they have decided to hold protests pan India as their repeated pleas wage revision for January 1, 2022 for port and dock workers is due. If revised, this will benefit 17,500 port and dock workers of group C&D across all the major ports. The overall implication of the wage revision will be Rs 200 crore per annum.
