Vizag port slashes wharfage, handling charges

In a move designed to bring in more revenues and provide better services, the Visakhapatnam Port has decided to offer concessions both in wharfage and handling charges on imported project materials.

"To avoid diversion of project cargo to other ports, we have decided to reduce the handling charges in Vizag port. This will also fetch us more revenues," K Ratna Kishore, chairman, Visakhaptnam Port, told Business Standard.

At present, the Vizag port calculates wharfage charges on project materials on ad valorem basis. As the project materials are high-valued, the port charges are on a higher side as compared with other bulk handling charges.

In case of cargos other than project materials, the wharfage is on tonnage basis, which when compared with the wharfage paid on project materials is not exorbitant.

A few importers, who recently visited the Vizag port, felt the port charges were exorbitant due to the wharfage on ad valorem basis. The projects were estimated in thousands of crores of rupees and the wharfage was not commensurate with the services provided, they said.

The importers are not too satisfied with the time allotted to clear the cargo either. Currently, the port allows only two days free time to clear the cargo after unloading from the ships failing which the port charges huge demurrage.

According to the importers, it is quite difficult to clear the project material within the stipulated time, as the same has to be transported to their plants situated at far off places. The limited availability of specialised trucks and trailer too is an impediment, they said.

Of late, many new projects have come up in states like Chattisgarh and Orissa, which form part of hinterland of East Coast Ports. The importers, thus, have an option to import the project materials through any of the ports like Haldia, Paradip, Vizag or other private ports.

All this has led the Vizag port to go in for a 25 per cent rebate in wharfage charges on ad valorem basis and extend the free time for project material from two days to 10 days in case of demurrage charges.

"We are providing better services, quick berthing and unloading facilities. This decision will increase the frequency of project cargos through the Vizag port and raise revenues," Rao said.

The National Thermal Power Corporation and L&T have put forward their proposals to import Rs 1,600 crore worth of project cargo from Doosan Heavy Industries, Korea, for their 660 X 3 mega power project located at Sipat in Chattisgarh from the Vizag port.

Apart from this, other supplies worth over Rs 4,000 crore are under finalisation and once the imports of L&T is routed through the Vizag port others will follow the same route if the port reduces the wharfage charges and extends the free time for clearing the material, port sources said.

Project cargo

• Move aimed at bringing in more revenues to the port
• Port to give 25 per cent rebate in wharfage charges on ad valorem basis
• Also to extend the free time for project material from two days to 10 days in case of demurrage charges