Kolkata Port Trust (KoPT) is poised to get a royalty of R14.77 for per tonne of cargo handling with Ripley & Co emerging as the highest bidder following a tender for granting handling agency licence. This can fetch the ailing port revenue of above R60 crore per annum. The selected agent will be required to do shore handling as well as supply man power and equipment for handling dry bulk cargo.
Prior to tendering, stevedores have been carrying out shore operations without paying any royalty to the ports. Ripley was charged of carrying out restrictive trade depriving the port of legitimate revenue. But with a new government at the Centre, paying royalty has been made mandatory in the country’s major ports.
Ripley chief executive officer Shoumik Bose said the company was not averse to paying royalty and so participated in the tender.
“We cannot be held responsible for not paying royalty. Rather it was the government’s fault of not having such a scheme. Now that there is a royalty scheme it should be extended to all major ports,” Bose said.
While the handling agent has been selected, the port is yet to make the royalty effective. “The royalty should be made simultaneously effective across all major ports following completion of the tendering process,” a KoPT official said.
KoPT chairman RPS Kahlon said among the 10 bidders, who participated in the royalty tender, Ripley & Co emerged as the highest bidder quoting a royalty of R14.77 per tonne.
KoPT had fixed a minimum revenue sharing of R13 per tonne above a port charge, whose ceiling has been fixed at R119.48 per tonne.
Other port handling agents such as JM Baxi, Lee & Muirhead and AM Enterprise, however, claimed that the port charge has been fixed on faulty lines without considering inflation that has taken place over the past few years.
The ceiling rate has been fixed following 2011 rates, while 2014 rates are much higher at R143.38 per tonne.
“If the ceiling rate is established in Haldia port, rates will have to be similar in other major ports. Such a rate will put tremendous pressure on cargo handlers and operations at major ports will become unviable giving private ports an edge over major ports,” an official of a stevedoring firm said on the condition of anonymity.
Handlers, along with Ripley & Co, have already moved the Calcutta High Court challenging the ceiling rate.
The Calcutta High Court had first put stay on the tender and, thereafter, vacated it asking the complainants to file a writ. The court directed the port to continue with the tender process untill further orders.
Former KoPT chairman Bikram Sarkar said a ceiling rate is against the concept of market economy because it hampers price discovery.
The government plans to bring major ports under a ceiling rate while keeping all private ports out of it.
“There should be a level playing field for all ports across the country,” Sarkar said.
* KoPT had fixed a minimum revenue sharing of R13 per tonne above a port charge, whose ceiling has been fixed at R119.48 per tonne
* Agents say the port charge has been fixed on faulty lines without taking inflation into account
* The ceiling rate has been fixed following 2011 rates, while 2014 rates are much higher at R143.38 per tonne