NEW DELHI: The port has sought restructuring of the dues, envisaging containing the mandatory penal interest to Rs.14.05 crore.
Cochin port is heading for a major financial crisis, with the accumulated losses touching Rs. 478.77 crore. The Centre has also slapped interest and penal interest on the financial aid of Rs.258.14 crore it had extended to the port from time to time. The port is now required to pay to the Centre Rs.263.53 crore as interest and Rs.715.34 crore as penal interest.
The accumulated losses have been mounted on account of the below capacity operations at the Vallarpadam Container Terminal and the LNG terminal in Kochi. The port has sought restructuring of the dues, envisaging containing the mandatory penal interest to Rs.14.05 crore, and repayment of the remaining financial burden of Rs.537crore over a period of 15 years.
In view of the emerging crisis, the State government has urged the Centre to extend concessions to the port, which employs 2,000 persons directly and over 10,000 indirectly. According to official figures, the port handles 216 lakh tonnes of cargo annually.
The port authorities have also asked for Rs.168 crore as budgetary support for carrying out dredging activity in the port. Official figures show that the port is incurring Rs. 117 crore for dredging to deepen the channel for the Vallarpadom terminal. The expenses were more than the income at Vallarpadom in the last five years, with dredging turning out to be a drain. The State government has proposed sharing of dredging costs by the Navy and the Cochin Shipyard which use the channel to reduce the financial strain on the port.
Another major problem which is likely to come up is related to cabotage laws. Vallarpadam had got concessions under the cabotage law in 2012 and this is due to expire in April 2016. The concession was given in view of the fact that there were hardly large Indian owned ships operating between Indian ports. The port has sought a 30-year long-term concession in order to make the Vallarpadom terminal viable and increase its capacity from the current 36 per cent. Chief Minister Oommen Chandy and Ports Minister K Babu have asked the Members of Parliament to put pressure on the Centre to take action to save the port.
