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Paradip Port Trust, located in Odisha, has received the regulator’s nod to hold rates till March 2019, as India’s fastest-growing state-owned port pulls out all stops to retain existing customers and lure new cargo to reach the goal of 100 million tonnes (mt) by March 2018.
The existing rates were approved by the Tariff Authority for Major Ports (TAMP) in March 2011 when it ordered an across-the-board reduction of 32 per cent in the cargo-handling charges and maintained status quo on all other rates at the port.
The rates at major port trusts are revised every three years, according to the rules.
The port trust has been extending the validity of the existing rates set in 2011 with the approval of TAMP and the last extension ended on September 30.
The rates took effect from October 1 and will run through March 2019, which means the port will be operating with the same rates for eight years.
In its application submitted to TAMP, the port trust said it was not seeking a raise and proposed to continue with the existing cargo-related and vessel-related charges till March 2019.
“We are facing severe competition from Dhamra port,” said port chairman Rinkesh Roy, an Indian Railway Traffic Service (IRTS) officer.
“By keeping the rates intact, we want to retain our customers and not let them shift to other ports,” he told Business Line , adding that Paradip is “one of the lowest-priced ports in the country”.
The port, which mainly handles dry and liquid bulk cargo, aims to reach the coveted 100-mt mark by the end of FY18.
“We are on course to reach the 100-mt milestone by March. We are keeping our fingers crossed,” he said.
When that happens, Paradip will be the third Indian port and the second state-owned after Deendayal Port Trust (formerly Kandla Port Trust) in Gujarat to achieve this feat.
Privately-run Mundra Port, also in Gujarat, was the first Indian port to reach the 100- mt mark in 2014, followed by Deendayal in 2016.
“This authority is inclined to accede to the proposal of the port to maintain status quo on the existing level of tariff,” TAMP wrote in a November 1 gazette notification.
Users hail moveMain users such as Jindal Steel and Power Ltd, IFFCO, TANGEDCO and NALCO have supported the port trust’s move to continue with the existing rates, saying that the rates at Paradip were now “comparable to rates at Dhamra, Kolkata and Visakhapatnam”.
In the year to March 2017, Paradip handled 88.955 mt of cargo from 76.386 mt handled a year earlier, clocking a growth of 16.45 per cent. Of the 88.955 mt, over 59 mt was dry bulk cargo.
Paradip is now India’s second biggest state-owned port by volumes after Deendayal Port Trust, which handled 105.44 mt in FY17.
The port posted an operating income of ₹1,177.17 crore and net surplus of ₹479.12 crore with an operating margin of 46 per cent in FY17.
The port registered a CAGR of 12 per cent between 2015 and 2017.
Between April and September 2017, the port loaded 47.605 mt of cargo from 42.668 mt a year ago, growing at 11.57 per cent.
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