Sea freight importers and exporters using Mumbai's Nhava Sheva International Container Terminal (NSICT), India's first port established under public-private partnership, paid 80 per cent more than the permissible amount between 2002 and 2005, according to a study posted on the website of India's Planning Commission.
The study, by Bharat Salhotra, says his views do not represent those of the Planning Commission, though the author cites a Planning Commission official as providing "key insights and valuable inputs," reports the India's Business Standard.
According to the study, NSICT earning on equity were in excess of 100 per cent against the permissible level of 20 per cent from 2002 to 2005, owing to lax regulatory supervision by both the nation's Ministry of Shipping and the regulatory Tariff Authority for Major Ports (TAMP).
The study revealed that the TAMP allowed NSICT to classify the revenue share or royalty it paid the government as cost when in fact the law stipulates - initially ambiguously and was later changed - that royalty should be charged on profits. This meant that the higher revenue share promised, the higher the cost, and in turn higher tariffs for port users.
According to the study, NSICT could earn INR583 billion (US$14.6 billion) over its concession period of 30 years, said the Business Standard.
NSICT is part of the Jawaharlal Nehru Port Trust (JNPT), which invited in 1995 bids for the construction, operation and maintenance of a new container terminal for 30 years on a build-operate-transfer basis.
The contract was awarded to a consortium, comprising P&O Australia Ports, Konsortium Perkapalan Berhad and the DBC Group of companies, said a report by livemint.com, of The Wall Street Journal.
The present owner of the terminal is DP World. The livemint report cited Ganesh Raj, the senior vice-president of DP World, saying: "I cannot comment on this report because it is baseless. The tariff charged by state-owned terminal JNPT and private terminal NSICT is almost the same."
|
