HC restrains state from developing ports through MoUs

In what may thwart the Orissa government's move to select developers for minor ports through the MoU (Memorandum of Understanding) route, the Orissa High Court (HC) today restrained the state government from signing any further MoU with any developer for setting up of any port in the state.

The interim order came from a vacation bench of the HC consisting of Justice Indrajit Mohanty and Justice S K Mishra.

"The state government shall not sign any further MoU or any concessionaire agreement with any port developer without the leave of this court”, the bench observed. The next hearing on the matter is scheduled for June 21.

It may be noted that noted environmentalist Biswajit Mohanty had filed a Public Interest Litigation (PIL) in the HC, questioning the morality of the state government in signing MoUs with the port developers.

"The state government is not following any specific guideline although the Central government has stipulated that the ports should be set up after an international bidding. As many as 26 ports are the pipeline and the state government has signed MoUs with three developers”, Mohanty had stated in his PIL.

The PIL also held that port developers should be selected on the basis of global bidding instead of the MoU route.

Commenting on the Orissa HC's order, Gagan Dhal, principal secretary (commerce & transport) said, the court's order is not a setback as it has allowed us to go ahead with those port projects where we have already inked MoUs and concession agreements.

The HC has even said that the state government is entitled to signing MoUs or concession agreements with the port developers, but the same should not be finalized without the leave of the court, he said.

The HC also upheld our explanation that the Central government's directive is not applicable to development of minor ports, Dhal stated.

AICC general secretary Jagdish Tytler in charge of the party's affairs in Orissa had stirred a hornet's nest when he recently accused the Orissa government of massive corruption in selection of developers for eight upcoming minor ports in Orissa.

Tytler alleged the scam in each of the ports was to the tune of Rs 40,000 crore, meaning an overall scam of Rs 3.2 lakh crore for the eight ports, which has higher than the 2G spectrum scam.

The state government had identified 14 potential locations for the development of minor ports in the state.

The locations identified for the development of the minor ports are Inchuri, Bahabalpur and Bichitrapur in Balasore district; Jatadhari Muhan in Jagatsinghpur district, Barunei Muhan and south of Barunei Muhan in Kendrapara district; Chudamani in Bhadrak district, Palur and Bahuda Muhan in Ganjam district and Astaranga and Baliharchandi in Puri district.

The state government had signed MoUs with Creative Port Development Ltd for setting up a port a Kirtania in December 2006; Navayuga Engineering Company Ltd for a port at Astaranga in December 2008 and also with Essel Mining and Industries Ltd, an Aditya Birla Group firm, for establishment of a port at Chudamani in October 2009.