Shipping monopoly policy draft finalised

The shipping ministry’s aim of having a monopoly policy for major ports has moved a step forward. The policy draft — prepared by the ministry — has been forwarded to the law ministry for approval. The draft had been made in consultation with private players and their concerns had been addressed to the extent possible, said a senior official in the shipping ministry. In order to speed up the process, the shipping would appoint an expert to help the law ministry’s officials understand the technicalities involved.

The policy is being formulated to check private sector monopoly in ports and encourage more players to invest in the sector.

 

Stakeholders, however, are of the opinion that such a policy is regressive. “People who are qualified and have the expertise in the sector should not be banned. In container terminals, it is a well-known fact that the longer the quay length, the lower is the cost. A monopoly policy won’t boost this sector. This is what we have been saying as members of the Indian Private Ports and Terminal Association,” said Sriram Ravi Chander, chief operating officer, Visakha Container Terminal.

Under the policy, a private player would not be allowed to bid for consecutive berths for the same cargo. It would also not be allowed to bid for a terminal within the 100-km radius of an existing one. The policy will address issues like the quay length limit beyond which one player cannot have a berth. The policy would also put a cap on overall capacity and the number of terminals one can have at a port.

“Any such policy is likely to bring down the level of expertise,” said Anil Singh, senior vice-president and managing director (subcontinent), DP World.

The idea of having a monopoly policy was mooted in 2007 when PSA Sical — a joint venture of Port of Singapore Authority and Sical of Chennai, bid for consecutive container terminal berths. The bid was cancelled by the shipping ministry due to concerns that it would lead to monopoly at the port. Since there was no law in place to curb the private players, the matter came under litigation and bids were invited again. “It was after this incident that we felt the need to have a well-defined law in place to prevent monopolistic practices in the ports sector,” said the official.