Date:10/11/2005 URL: http://www.thehindubusinessline.com/2005/11/10/stories/2005111001580700.htm

Back Kochi port terminal operator gets nod to hike tariff

V. Sajeev Kumar

Kochi , Nov. 9

THE Tariff Authority for Major Ports (TAMP) has approved the proposal of the India Gateway Terminal Pvt Ltd (IGTPL) — the container terminal operator of Kochi Port — for an increase in various port related charges.

The TAMP has effected an increase of 8 per cent in the scale of rates from November 21 for IGTPL operations in the Rajiv Gandhi Container Terminal of the port. It is understood that another increase of 8 per cent has also been approved by TAMP with effect from April 1, 2007.

In its revised proposal submitted before TAMP, the IGTPL had clarified that the cost incurred to improve the efficiencies of existing facilities issubstantial necessitating immediate implementation of original proposal tariff.

However, a graded increase in tariff in three stages is proposed so that the port users experience tangible benefits before additional costs are passed on to them.

It may be recalled that the IGTPL had earlier proposed a 35-per cent increase in scale of rates in May soon after it had taken over the terminal operations.

However, the TAMP had convened a meeting between port users and the terminal operator to discuss the proposal. During the meeting, the TAMP had asked IGTPL for more clarifications on its demand for increase in the scale of rates following protests from port users. Based on that, IGTPL had submitted new proposals for a hike in rates.

In the new proposals, the IGTPL had also made a traffic projection before the TAMP. The projected traffic for 2005-06 is 2,12,951 teus, while it is 2,44,894 teus for 2006-07 and 2,65,761 for 2007-08.

While considering the proposal, TAMP had also received a reference from the Union Ministry of Agro and Rural Industry and the Union Commerce Ministry expressing concern over the proposed hike, saying that the hike would adversely affect the coir industry in the State since coir is an agro based rural, traditional and labour-intensive industry.

Sources in the shipping fraternity told Business Line that irrespective of the TAMP's proposal, the IGTPL had first hiked the port handling charges from Rs 150 to Rs 225. It is understood that they are planning for another additional cost at the pre-stage area of Rs 400 per teu for completion of documentation.

There were also plans to charge another Rs 400 a day as an additional cost of transportation to shift long-standing containers (above 30 days) from the import stack to an outside bonded area.

This charge, according to sources, is higher than the charges to be paid for containers inside the wharf area.

The port users have warned that all these charges would hit exporters as well as importers and make Kochi an expensive port, resulting in cargo diversion to neighbouring ports.