The government is planning to adopt a carrot and stick policy for workers of Jawaharlal Nehru Port Trust (JNPT) to win their support for converting JNPT into a company. The proposal is to give a bonus to the workers who give their consent to corporatise the port. Dissenters will be offered voluntary retirement.
The government has been trying to turn the port into a company since 2007, but a section of the workers fear that corporatisation would eventually bring in privatisation and perceived uncertainties associated with it. Thanks to the workers’ opposition, all efforts at corporatising the port, the third largest in the country by traffic volume handled, have so far been circumvented. Last month, the workers’ unions had approached chief labour commissioner NK Prasad, urging that the proposal be abandoned.
Currently, there is only one major port as defined under the Indian Ports Act, that has a corporate structure namely the Ennore port.
Sources said that the JNPT workers have got support of some senior officials of the port as well as workers of other major ports led by All India Port & Dock Workers Federation.
The carrot and stick policy is the latest of the government’s effort to corporatise JNPT, which will allow managerial and financial autonomy to the country’s third largest port in terms of traffic handled during 2010-11 and fourth biggest in capacity. There are 13 major ports in the country and some of them lag behind minor ports in adding new capacity and handling traffic.
The incentive could be in the form of bonus to employees to sweeten the deal for the workers. However, the amount of bonus would be decided after it is corporatised and paid by the port out of its own resources. ?We are considering a bonus for those employees who support the idea of corporatising the port. This may help us in corporatising the port by the end of this financial year,? a senior official from shipping ministry told FE.
The offer is part of a draft Cabinet note prepared by shipping ministry that will soon be circulated among central ministries for their comments.
A senior representative of All India Port & Dock Workers Federation said workers can opt for bonus if the right amount is paid. ?Unless the government or the port tell us how much bonus we will be paid, how can we decide. As of now, it is just a proposal,? he said, requesting not to be named.
Shipping ministry has also sought exemption from capital gains tax of 20.6% for the port to reduce its financial outgo in the even of corporatisation. Besides capital gains tax, the port will also have to pay income tax at the rate of 33.99% a year instead of 30.6% at present. It will also attract minimum alternate tax. The government will retain its ownership on the land area of JNPT even though all other assets will be transferred to the corporate entity.
The government is making efforts to corporatise major ports since 2001, when Ennore Port was incorporated as a corporate entity. It had introduced Major Port Trusts Amendment Bill in Parliament in 2001 to bring about necessary changes to corporatise other ports. But the end of government term stalled the efforts. Later in 2006, a committee was formed to study the experience of Ennore Port suggested complete corporatisation of JNPT and Halida Dock Complex at the earliest.