Centre targets Rs 10,000 crore from monetisation of ports in FY25

Looks to monetise assets worth Rs 10,000 crore in FY25

With the aim of increasing the share of public-private partnership (PPP) in ports, the Centre will look to monetise assets worth Rs 10,000 crore in 2024-25 (FY25), according to multiple sources familiar with the developments.

The Ministry of Ports, Shipping and Waterways has submitted a monetisation pipeline of Rs 10,000 crore, consisting of five-seven projects, to NITI Aayog — the central think tank and nodal government body for asset monetisation — according to a senior government official.
 

Queries sent on Friday to the Ministry of Ports, Shipping and Waterways did not receive a response until the time of going to press. 
 

The Centre is looking to increase the share of PPP at government-owned ports to 80 per cent by the end of the decade, Shipping Secretary TK Ramachandran recently said.
 

However, newly identified projects make up only a small portion of the shipping ministry’s FY25 pipeline, with a focus on pending mega projects.

In the pipeline
 

Move to increase PPP share in ports to 80% by the end of the decade
 

FY25 monetisation pipeline includes 5-7 projects

Rs 7,055 cr container terminal at VO Chidambaranar Port Authority in Tuticorin also listed

Focus on pending mega projects
 

Among these is the Rs 7,055 crore container terminal at VO Chidambaranar Port Authority (formerly VO Chidambaranar Port Trust) in Tuticorin, Tamil Nadu, which has been in the pipeline since 2023.
 

In April, Adani Ports and Special Economic Zone, Singapore’s PSA International (formerly the Port of Singapore Authority), Dutch major Van Oord, JM Baxi, and JSW Infrastructure showed interest in the project.
 

The project aims to capitalise on newfound investor interest in the region.

The region is set to get mega investments such as the Rs 16,000 crore electric vehicle manufacturing unit by Vietnamese major VinFast, the Indian Space Research Organisation’s second spaceport in Tamil Nadu’s Kulasekarapattinam, and Singapore’s Sembcorp’s Rs 36,238 crore investment in renewable energy.
 

The pipeline also includes the multipurpose cargo berth at Deendayal Port Authority’s (Kandla Port, Gujarat) satellite terminal at Tuna Tekra, the tender for which is currently undergoing restructuring due to minimal interest in the project from the industry, owing to market uncertainties and the substantial investments involved.
 

“Some aspects related to pricing, clauses on dredging to be done by the concessionaire, and other minor details are being revisited,” another official said.

The Centre has initially expected the project to fetch Rs 1,700 crore.

In addition, the new projects comprise two terminals at Syama Prasad Mookerjee Port, Kolkata, and one project at Kandla Port.

According to sector experts, port monetisation will become trickier as most of the unexploited and revenue-generating terminals have already been bid out, and competing terminals at the same ports will attract lower interest.

“Five PPP projects worth Rs 9,080 crore have been sanctioned, and eight PPP projects worth Rs 700 crore have been awarded in 2023-24 (FY24),” the shipping ministry said earlier this month.

So far, the shipping ministry has outperformed its monetisation targets, which were set at Rs 12,000 crore under the national monetisation pipeline.

To date, 81 projects worth Rs 42,400 crore have been identified and proposed to be awarded in PPP mode. The ministry was aiming to monetise 20 terminal projects valued at Rs 6,800 crore in FY24.