The Hindu Business Line : TAMP rejects across-the-board hike in Chennai box terminal tariff

In its May 21 notification, TAMP has, however, allowed CCTL to revise some of the tariff items at the container terminal such as charges for handling transhipment containers.

New Delhi , May 27

THE Tariff Authority for Major Ports (TAMP) has rejected a proposal submitted by P&O Ports for a steep across-the-board hike in tariff at its container terminal in Chennai Port. The CCTL had sought an increase in tariff for various items ranging from 25 per cent to 150 per cent.

"From the cost statements furnished by CCTL, it may be seen that there is an average net surplus of 0.1 per cent of the operating income for the years 2004 and 2005.

"This position is with reference to the estimated revenue based on the interim tariff increase of 17 per cent allowed earlier.

"In view of this cost position, there does not appear to be any justification for approving the steep increase in various tariff items proposed by CCTL," TAMP has ruled in a Gazette notification issued on May 21.

It would suffice if the existing interim tariff fixed with an increase of 17 per cent allowed in November 2003 is permitted to continue for the next two years, the tariff regulator has said.

In compliance with a policy direction issued by the Ministry of Shipping, TAMP had approved on an interim basis an across-the-board increase of 17 per cent in CCTL tariff to take into account a maximum of 27 per cent out of the total revenue share of 37.138 per cent paid by CCTL to Chennai Port Trust as part of the Concession and License Agreement. The 17 per cent increase gave CCTL the benefit of recovering 27 per cent of the total revenue share as cost through tariff.

A similar approach of considering 27 per cent of the gross revenue as cost for tariff fixation has been adopted in this case also.

In its May 21 notification, TAMP has, however, allowed CCTL to revise some of the tariff items at the container terminal such as charges for handling transhipment containers which has been prescribed at 120 per cent of the rates for handling normal Full Container Load (FCL) containers, translating into an increase of around 10 per cent in the existing interim rates for handling transhipment containers.

TAMP has also approved the proposal to bifurcate the composite rate for handling of containers at the yard into separate tariff items, namely, transportation to/from quay and handling at container yard which includes lift-on/lift-off and delivery/receipt based on a ratio of 47.5:52.5.

Further, CCTL has been permitted to grant a 5 per cent reduction in the transportation charge for local deliveries in case of ICD containers.

The tariff regulator has directed CCTL to continue with the existing free period structure for export, import and ICD containers even while endorsing the private operator's proposal to levy storage charges to act as a deterrent in making the users expeditiously clear their containers.

The storage charges can be levied only after the expiry of the prescribed free periods.

A premium of 25 per cent on storage charges for hazardous containers has been allowed by TAMP though a demand by CCTL to levy a premium in wharfage charges for hazardous containers has not been accepted by the Authority.

The tariff revision proposal submitted by P&O Ports had sought to make a total change in the free period structure including levying storage charges without giving any allowance if containers are not cleared within the prescribed free period.

This proposal was vehemently opposed by the users.

TAMP has also approved changes in the existing tariff structure along with introduction of some new tariff items in the case of CFS activity and stuffing/de-stuffing of less than container load (LCL) containers.

For estimation of income, TAMP has approved an exchange rate of Rs 44 for $1 as proposed by CCTL.

The revised rates will take effect after expiry of 15 days from the date of the Gazette notification.