With its USD 15 billion Carmichael coal mine stuck since 2010 for want of green nod, Adani group has requested the Australian government to draft a special law prohibiting green groups from seeking repeated judicial reviews of environmental approvals.
"Last month, I had an hour-long meeting with the Australian Prime Minister Malcolm Turnbull and requested him to pass a law that restricts greens from seeking judicial reviews of environmental clearances time and again," group chairman Gautam Adani told a select group of journalists. He was here for the launch of Vizhinjam International Multipurpose Seaport by his group on Saturday.
In 2010, Adani Group had acquired the rights to develop the Carmichael coal mines in the Galilee Basin of Queensland state in Australia involving an investment of USD 15 billion over a period of time. The project, which includes building a rail link and a port at Abbot Point to ship the coal out, has been opposed by green groups ever since.
Because of the opposition, the group has been finding it difficult to get banks to fund the deal. Even State Bank of India had withdrawn its committed loan of Rs 8,000 crore to the project. The loan agreement was signed by the SBI chief and Adani in the presence of Prime minister Narenda Modi in Sydney last year.
"We had placed the proposal before the Australian government during an hour-long meeting with the prime minister on November 4. I had met him even yesterday (December 4). I think this is the only lasting solution I can look at.
"Now it is enough. They cannot continue to challenge the project. They cannot go for judicial reviews all the time. In OECD (Organisation for Economic Co-operation and Development) member-nations approvals are not given with closed eyes countries," Adani said.
"Ultimately the politicians have to go to Parliament and enact a special law which says that once the government gives approval, no one can challenge it. That's our request to the Australian government," Adani said.
When asked whether such a law is possible to help save a
corporate investment and whether there are any such precedents to the same, he answered in the affirmative. "Yes, they have done so in the past".
Admitting that his company is facing a unique challenge Down Under, Adani said that "on one side, the government is giving us all approvals and on the other, environment activist groups are seeking judicial reviews and that derails the whole project.
"Even though there is no stay, because of the judicial review, no lender will finance the project. They do not know what will be the outcome".
He added: "The greens are finding some technicality to seek review, which anyone can do. Some technical mistakes here and there and they go to the courts. That will not help the larger interest as the project is very important from the point of view of both India and Australia."
Stating that the Carmichael coal mines are the world's largest, Adani claimed that the mine can support a minimum 100 million people to have electricity for a century or more.
The controversy has delayed the project by one-and-a-half years during which coal prices have slumped, he said, adding, "We have to revive to the next cycle".
On the Cabotage law exemption given to his upcoming Vizhinjam transshipment port, which is the only port to get such an exemption even before the work on the project has not begun, Adani said it is in response to the state government's and our pleas.
He also said the so-called landlord port concept can't work for transshipment ports such as Vizhinjam and allarpadan.
"If you really want to enter the transshipment business, you've to slash the price by half to compete with Colombo through which India sends and receives a big chunk of its container cargo.
"If you are paying 33.3 per cent as revenue share to the government-owned Kochi Port assuming a rate of Rs 4,000 a container and suddenly you want to handle at Rs 2,000 of which 33.3 per cent has to be given to the government-owned port, what is left for the developer?" Adani said.
Adani added: "That's why Dubai's DP World has not been
successful at Vallarpadam. Whatever they say, the landlord port concept will never work for transshipment.
"At Mundra port which is the biggest commercial port and the only one to handle 100 million tonne or more of cargo, we are landlord port as well as operator. We've freedom to do many things including setting rates. That's why we are successful. Ultimately, our aim is to give a final solution to users."
Adani Ports & Special Economic Zone has won the contract to build and operate the country's second container transshipment port at Vizhinjm, which is being built at a cost of Rs 5,552 crore. The project is also the first to get central viability gap funding worth Rs 800 crore.
Adani said he was confident of making the Vizhinjam port a success as unlike the Central-government controlled Vallarpadam transshipment terminal near Kochi, which does not enjoy Cabotage exemption and is governed by the government set tariffs and therefore is utilizing only 30 per cent of its capacity.
At Vallarpadam, which operates on the landlord port model, rates are set by a regulator and the operator has to share 33.30 per cent from its annual revenue with the Kochi Port Trust during the 30-year contract.
At Vizhinjam, the state will begin to get revenue share from the 16th year, which will rise by 1 per cent annually to touch 40 per cent at the end of 40th year contract that can be extended by 20 years more, even though half the investment is being borne by the state.
