Govt declines Louis Dreyfus Armateurs's arbitration notice on Haldia port dispute

The notice was sent because HBT suspended its operations at Kolkata Port

The legal fight on cargo handling at Bengal's Haldia port continues, with the government rejecting the validity of a legal notice for arbitration from France-based Louis Dreyfus Armateurs (LDA). The matter is also in court.

LDA had run into a legal battle with the Kolkata Port Trust after Haldia Bulk Terminal, a venture of ABG Infralogistics and LDA, had pulled out of a 10-year contract for cargo-handling operations at the Haldia docks in October 2012.

An inter-ministerial group headed by shipping secretary Vishwapati Trivedi has since okayed a reply to LDA's notice that the company in terms of a treaty did not come under the definition of an investor. A government official said since the contract was signed between ABG and Kolkata Port, LDA could not send an arbitration notice.

"Besides, they have not exhausted all legal remedies. Arbitration is the last resort."

LDA has been unable to remove its equipment from the port premises since it pulled out of the project. The company wants to be compensated for the loss on this account, too. But Kolkata Port Trust wants the company to pay the costs due to their pulling out. ABG's plea to be allowed to resume work at Haldia is pending at the high court in Kolkata.

The problem at Haldia started early September when HBT, citing unviability, planned to suspend its operations and after a court intervention had to enter into a deal with KoPT, which ensured them more cargo. After this, HBT retrenched about 275 workers, which led to violent protests. HBT decided to pull out of the contract, alleging abduction of three of its officials including the family of one employee on October 28.

LDA is part of century-old agribusiness giant Louis Dreyfus, popular in the global trading circles as a constituent of ABCD traders, which stands for Archer Daniels Midland, Bunge, Cargill and Louis Dreyfus.