 "Photo: Official Website of PressTV")
All's not well with the proposed Sagar Islands port. New draft tenders inviting private players to develop and operate facilities for the Rs 12,000 crore project conceived by the Union shipping ministry in 2013-14 have been struck down by the Public-Private Partnership Approval Committee (PPPAC).
The issue is around the feasibility of the model. While the Kolkata Port Trust (KoPT) had proposed a revenue sharing model, besides a viability gap funding proposal (VGF), the PPPAC has questioned the need for VGF when revenue sharing model has been proposed.
The port trust is hopeful of sending a fresh proposal, striking down the VGF part while revising the revenue sharing model. In the proposal, KoPT had opted for a 20% revenue share in the special purpose vehicle which is likely to be brought down.
While KoPT officials are keeping mum over the issue after PPPAC sent back the draft tenders raising this key concern, repeated calls and messages to the port's chairman MT Krishna Babu went unanswered.
KoPT has resorted to taking consultancy services from EY over the project feasibility while financial advisory has been sought from Aecom.
Besides the objection from PPPAC over the draft tender, the issue of environmental clearances is also in place.
Sagar, the largest island in the Hooghly delta archipelago, is prone to frequent soil erosion which is monitored by the West Bengal State Coastal Zone Management Authority. Also, as per the Coastal Zone Management Authority Act, 1972, permits and clearances are a prerequisite for such activities on the proposed port.
As per a KoPT study, the southwest bank of Sagar Island has been identified for development of port facilities. The requirement of land for dock, jetties, back-up facilities, railway sidings and others has been roughly estimated to be around 2000 acres, for which the West Bengal government has been approached.
“Both riverine jetties and impounded dock system are possible at the location. The commodities which can be handled are dry bulk commodities like coking coal, thermal coal, coke, iron ore and also containers,” an official at KoPT said.
The project is supposed to boost KoPT's cargo handling capacity by 60 million tonne (mt). Presently, the draft available at Sagar Island is around 10 metres without dredging, which is more than that of Kolkata and Haldia.
Meanwhile, a detailed project report is being prepared for constructing a Rs 2,800 crore bridge connecting the Sagar Islands with the mainland. This project will be executed by the National Highways Authority of India.
Union shipping minister Nitin Gadkari had previously stated that the technical and feasibility study for the proposed port has been completed and the project will kick-start in March this year, but with the proposed tenders in a limbo, the situation is back to square one.
