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Visakhapatnam scraps berth deal with Adani

Logistic News - Published on Tue, 13 Mar 2018

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Times of India reported that the port of Visakhapatnam is in the process of taking back control of a berth built by the Gautam Adani group after it cancelled the concessionaire agreement with the Gujarat-based business group, Mr PL Haranadh, the deputy chairman of the Visakhapatnam Port Trust, said. Mr Haranadh told TOI by telephone from Visakhapatnam that VPT had issued the concession agreement cancellation letter to the Adani group recently.

Mr Haranadh said that "The agreement was cancelled because the Adani group failed to meet the cargo-handling commitments in the agreement for the last 3 years. While the commitment was that Adani would handle 7 million tonnes (mt) per annum of coal, the berth handled less than 2 mt. We are well within our rights to cancel the concessionaire agreement because of this."

Asked whether the Adani group had challenged the cancellation, he said, "The Adani group built the berth on the Public-Private Partnership model, and agreed to handle 7 mt of coal every year, but they never reached the cargo throughput target for the past three years, so they cannot claim the Rs 350 crore they said they have invested in building the berth from VPT."

He said that the VPT would be utilising the Adani-built berth to handle bauxite and coal, both steam and coking coal. "There has been a dramatic increase in the import of both bauxite and coal. The bauxite is for the Vedanta aluminium smelter in Odisha and the steam coal is imported by NMDC, also in Odisha, while the coking coal is imported by Rashtriya Ispat Nigam Ltd. We handled two million tonnes of coal this financial year, compared to the less than one mt in the last financial year. We expect more coal and bauxite, so the Adani berth can be used to handle the increased traffic."

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Posted By : Nanda Koijam on Tue, 13 Mar 2018
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