The Hindu Business Line : Chennai Container Terminal's tariff hike plans: TAMP says no

Chennai April 30 The Tariff Authority of Major Ports (TAMP) has declined to give the 11-per cent increase in tariff sought by the Chennai Container Terminal (P) Ltd, which runs the private container terminal at Chennai.

The existing rates would continue till December 2009, said a CCTL official. The TAMP regulates all tariffs (both vessel cargo-related) and rates for lease of properties in respect of major port trusts and the private operators located therein. Part of the Dubai-based DP World, CCTL in April 2006, sought a 18 per cent increase in tariff and reduced to 11 per cent this year, according to the TAMP.

Seeks tariff hike

While there is, prima facie, a case for a rise in tariff as shown in the table, the deficit shown by the cost statement for the year 2009 was on account of the anticipated diversion of traffic to the second terminal to be run by PSA Sical, says the TAMP order. Even though the licence for second container terminal has been awarded, the timing of commissioning of that terminal and the quantum of possible diversion of traffic cannot be anticipated with any degree of certainty. "That being so, the Authority finds it not reasonable to give advance effect to the anticipated and uncertain reduction in traffic in 2009 by allowing tariff increase for the years 2007 and 2008, which are otherwise reporting a surplus position," the TAMP said.

The TAMP observed that a clear position about the second container terminal will emerge by the later part of 2008.

Therefore, the Authority would like to maintain the same level in tariff levels for 2007 and 2008, and, if necessary, to consider any tariff adjustment for the year 2009 at a later stage.

CCTL estimated its container traffic for 2008 at 8.65 lakh TEUs ( 20-foot equivalent units). On the basis of a 12 per cent market share of the second container terminal (out of the total volume of 10.29 lakh TEUs at Chennai), CCTL has estimated 1.20 lakh TEUs to be handled by the second operator for a period of six months from July 2008.

Since the second operator may commence operations in the last quarter of 2008, CCTL may handle 60,000 TEUs. Thus, 9.25 lakh TEUs are considered as the traffic at CCTL for 2008.

The estimated traffic of 7.49 lakh TEUs for 2009 reported by CCTL was relied upon recognising the impact of the anticipated commencement of the second container terminal, the order says.

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