The Hindu Business Line : ABG subsidiary arm bags Kolkata port terminal project

CARDINAL Logistics Ltd (CLL), the newly formed subsidiary of ABG Heavy Industries Ltd (a major player in the port and infrastructure development sector), has bagged the contract for development and operation of the Kolkata port container terminal project.

This marks a significant entry of the ABG Group, which owns 76 per cent stake in Cardinal Logistics, into development and operation of container terminals. The company is also among the four bidders in the race for the Rs 200-crore container terminal project at the Kandla port, the other three being L & T, Gammon India and Afcons. It was in the race for the Rs 1,000-crore third container terminal project at the Jawaharlal Nehru port as part of the PSA-led consortium, but had backed out subsequently.

Informed sources told Business Line that CLL plans to invest about Rs 40 crore for deployment of two mobile harbour cranes, reach stackers and other equipment at the container terminal at the Kolkata port, which comprises berth nos 4 and 8. With the Kolkata port authorities keen that the berth is developed at an early date to cash in on the surge in container traffic in India, CLL plans to have the equipment at the berth within six months — the terminal will be owned, operated and maintained for an initial period of 10 years, which can be extended subsequently.

When contacted, a senior official of ABG Heavy Industries declined to comment on the development. Sources, however, said that the company, as well as the Kolkata port authorities, are bullish about the prospects of the box terminal, which handled a traffic of 1.25 lakh TEUs last fiscal, representing a 15 per cent growth as compared with the previous year.

While the Kolkata port authorities have assured CLL a minimum throughput of 67,000 TEUs at the terminal, CLL is confident that the traffic would rise to 1.5 lakh TEUs in the first year of operation and could touch the 3 lakh-TEU-mark within the next two or three years.

According to the sources, CLL's optimism stems from the fact that Concor is in the process of setting up an inland container depot (ICD) at the Kolkata port, which would link the port to the Tughlakabad ICD with a direct train service. This would assure a steady flow of traffic to the port.

Further, with mainline vessels getting priority at the JNPT and Nhava Sheva International Container Terminal, operated by P & O Ports, feeder vessels are being elbowed aside.

Hence, feeder vessels have been looking for a port where they could get a priority. And, with draft limitations at the Kolkata port not allowing the bigger-sized mainline vessels, feeder operators could flock to the port's container terminal.

The ABG Group, which had recently diversified into the new area of erection of wind mills at different locations in the country for NEG Micon India, the wholly-owned subsidiary of Danish Company, NEG Micon, is also planning to foray into overseas port infrastructure development projects, especially as the switching over from BOLT projects to BOT projects by the Indian ports has put a cap on its fresh market growth.

The company feels that there was a potential market for leasing out of cargo handling equipment in Indonesian and South African ports.

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