Kerala CM steps in to rescue seaport project

By: | Published: February 26, 2015 12:00 AM

With the suspense over the Centre's cabotage tax waiver keeping major companies away from the tendering process of the Rs 4,089-crore...

With the suspense over the Centre’s cabotage tax waiver keeping major companies away from the tendering process of the Rs 4,089-crore Vizhinjam International multi-purpose seaport, Kerala chief minister Oommen Chandy has decided to clear the air on the issue.

Chandy is learnt to have discussed the issue with the brass of Adani Ports, one of the companies that initially responded to the process.

After the ambitious seaport project found no takers on Friday, the Kerala government has extended the bid date till March 25. The government also plans to hold a pre-bid meeting again. Of the five major port operating companies and consortium — Gammon Infrastructure Projects, Hyundai-Concast Infratech, Essar Ports, Adani Ports and a consortium of Srei Infrastructure and OHL — that responded to the global tender, only three came in to pick up the RFP papers. These were Adani Ports, Essar Ports and the Srei & OHL consortium. However, these three did not submit the RFP papers for the tender.

“I have assured the Adani Ports spokesperson that the confusion on cabotage tax will be resolved soon. We have brought this lack of clarity issue to the notice of the Union government and expect a firm announcement ,” Chandy told reporters.

The Centre plans to relax cabotage norms at major ports for empty containers, to let foreign-flagged vessels carrying empty containers move on India’s coastline without restriction. It has discussed the possibility of relaxing a shipping law that reserves transporting cargo on domestic routes to local ships. Shippers and port operators have been lobbying for this waiver for long. However, there is yet to be any final word on this.

Chandy said he would soon talk to the senior management of Essar Ports and the consortium of Srei and OHL, who had purchased the RFP and sort out the issues.

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