Chennai container terminal privatisation bags approval

Our Bureau

Chennai, June 11: Decks are now cleared for the handing over of the management of the container terminal of the Chennai port to the P & O Australia Ports Pty Ltd as the Chennai Port Trust at the board meeting held on Monday passed the resolution to that effect with one dissenting vote of a labour representative, it is reliably learnt.

The passed resolution will now be referred to the Union surface transport ministry, which will make the formal announcement of handing over of the port terminal. In an earlier order, the Madras High Court had declined to interfere in the government privatisation policy on port operations. The issue was to be settled at the borad level.

The P & O Ports had won the contract from the ministry in July 2000 to manage and operate the Chennai container terminal. A new company, Chennai Container Terminal Ltd (CCTL), was floated for this purpose in association with the Chettinad group, with P & O taking 75 per cent stake in it.

The proposal is that CCTL will take over the existing 600 metre container terminal. Expansion work of the terminal to 950 metres is going on and when complete the extended portion also will be under the new company. During the next five years the promoters would invest over Rs 600 crore for bringing in latest cargo handling equipment and other infrastructure works.

In the first year of operation CCTL plans to handle 3.5 lakh TEUs. It will go up to 4 lakh TEUs in the following year and five lakh TEUs in the third year.

The ministry envisages the Chennai port to be the hub port in the east coast attracting mainline vessels. uBut it may take at least three years for that to happen. Even then, the big vessels initially may carry only 20 per cent of the container traffic.

The formal handing over of the terminal would have taken place in December 2000. It has been delayed owing to issues related to labour and wages. In October P & O had made a tentative offer of the salary and allowances the company would pay to the container terminal workers and the number of workers it would absorb. Both were not acceptable to the workers.