Mundra Port security denial hearing next week

The Union shipping ministry intends to defend in the high court at Mumbai next week the refusal to allow the Adani Group’s Mundra Port and Special Economic Zone Ltd to bid for four major port projects.

MPSEZ was denied security clearance by the ministry of home affairs and so, the shipping ministry wouldn’t allow it to bid for two projects at Jawaharlal Nehru Port Trust (Navi Mumbai), plus projects at Visakhapatnam and Mumbai ports. Mundra challenged this in the HC. The hearing is on the coming Tuesday.

The shipping ministry affidavit, to be filed before the hearing date, would state the denial was a directive of the government, keeping in view the security scenario of the country, a senior official said.

Why MPSEZ is considered a security problem is unclear. It is operating and developing two non-major ports, Mundra and Hazira in Gujarat. The security clearance is for major ports, administered by the central government. It is not required for non-major ports, developed under state government monitoring.

The Ahmedabad-based Adani Group, a conglomerate, recently completed acquisition of Australia’s Abbot Point port for the equivalent of about Rs 8,900 crore. MPSEZ’s total revenue increased by 36 per cent for the year ended March 2011 over last year, to Rs 1,935 crore, with a net profit increase of 41 per cent to Rs 986 crore. The port handled 52 million tonnes of cargo in 2010-11 as against 40.3 mt in 2009-10. MPSEZ also won the rights to develop a coal import terminal at Visakhapatnam last year.