JNPCT awards 2 berths on PPP contract at a royalty of Rs4,520 per TEU

The contract includes a backup area of 54.74 hectares that can be used for the concession period. 

The project received overwhelming response from 11 investors having both domestic and international presence. 

In order to win the tender, the equal joint venture between J M Baxi Ports and Logistics Ltd and CMA Terminals offered a royalty price of Rs4,520 per TEU during the concession period against the minimum reserve price of Rs1,800 per TEUs.

JNPCT at present handles 9,000 TEUs capacity vessels and with the upgradation it will be able to handle 12,200 TEUs capacity vessels. It is also proposed to increase the RMQC rail span from 20 meters to 30.5 meters at the port. Investment for this project will be carried out by the concessioner at a total cost of Rs872 crore. The concessioner has to upgrade, operate, maintain and transfer this terminal on PPP basis. This project will be implemented in two phases.

In Phase I, 400 meters berth length will be upgraded to handle 12,200 TEUs capacity vessels (370 LOA vessels of 15 meters draft and 56.4 Beam). JNPA placed a Letter of Award (LOA) on J M Baxi Ports and Logistics Ltd and consortium member CMA Terminals on 28 June 2022 and is set to sign the concession agreement on 27 July 2022. The concession will be awarded after compliance to the conditions within 180 days. The period of phase I is 18 months from the date of award of concession agreement and the cost of phase 1 is Rs591.99 crore.

In Phase II, 280 meters berth length will be upgraded to handle 12,200 TEUs capacity vessels. The development of phase II will commence after achieving 1.02 million TEUs or 7 years, whichever is earlier. Phase II is to be completed within a period of 18 months and the cost of phase II is Rs280.17 crore.

The project received overwhelming response from 11 investors having both domestic and international presence. In order to win the tender, the equal joint venture between J M Baxi Ports and Logistics Ltd and CMA Terminals offered a royalty price of Rs4,520 per TEU during the concession period. The royalty due will increase yearly in line with the rise on the basis of the wholesale price index (WPI). Under the new Major Port Authorities Act and the model concession agreement (MCA), the terminal operator is free to fix market determined tariff rates. The MGC is expected to increase from 4 lakh TEUs in the first year of operation to 9 lakh TEUs starting in the tenth year and continue through the end of the 30-year contract.

PPP is considered an effective tool for attracting the investment in the port sector. Until now, 86 projects worth Rs55,000 crore have been granted approval under PPP. The key projects on PPP being implemented include berths, mechanisation, development of oil jetty, container jetties, O&M of the container terminal, O&M of international cruise terminal, commercialisation of non-core assets on PPP mode, tourism projects, viz, marina, development of islands to promote tourism. 

“This project will improve the utilisation of crane and berth productivity of the terminal. Also, total handling of JNPCT will increase to 1.8 million twenty-foot equivalent units (TEUs) from the handling capacity of 1.5 million TEUs in 2020-21. This will reinforce JNPA’s position as the ‘premier container port of India’. It is worth mentioning that this terminal will also be handling Ro-Ro vessels which will not only lower the logistics cost, reduce transit time but will also contribute in reducing congestion on roads and promoting towards clean environment,” union minister of ports, shipping and waterways Sarbananda Sonowal said.

With the cargo volume expected to increase between 1.7 and 2 times (base 2020) by 2030, the percentage of cargo handled at Major Ports by PPP or other operators, is expected to reach 85 per cent by year 2030. Each passing year is a milestone to achieve this goal.

To achieve this goal, MoPSW has already identified a project pipeline up to FY2025 with 13 projects, for FY 2022 (Rs6,954 crore) already approved by the MoPSW, followed by 24 projects of value ~Rs12,550 crore targeted for award in FY2023. Further, 44 projects of value ~Rs23,000 crore are scheduled for award in FY 2024 and FY 2025. 

High value projects, namely Western Dock at Paradip and JN Port Container Terminal of total value more than ~Rs3,800 crore have already been awarded with two projects of DPA, valued at ~Rs6,000 crore, under RFQ stage.

The percentage of cargo handled at all Major Ports through PPP operators is targeted to be 85% by year 2030.

The PPP mode of investment has brought rich dividends for Jawaharlal Nehru Port in terms of capacity addition, productivity improvement and revenues. Almost all Indian ports have made remarkable progress in the last 25 years.

Jawaharlal Nehru Port (JNP), the first port to enter into a concessionaire agreement with the government, the concessioning authority, on a public private partnership (PPP) mode, which has completed its 25th year of success in July, this year, has had tremendous impact on the development of PPP projects in major ports. 

JNP has now become the first major port of the country to become 100 per cent `Landlord Port’ having all berths being operated on PPP model.

JNP is one of the leading container ports of the country and is ranked 26th among the top 100 global ports (as per Lloyds List Top 100 Ports 2021 Report). Currently, five container terminals are operated at JNP, of which only one is port owned. With its state-of-the-art facilities, JNP meets all the international standards, user-friendly atmosphere, and excellent connectivity by rail and road to the hinterland. Facility of backup infrastructure like CFS, connectivity with ICDs, full-fledged custom house, airport, hotels, proximity to Mumbai, Pune, Nashik city and its industrial belt makes it an unique container terminal.