Recently the government has announced regulation of tariff guidelines for Public Private Partnership (PPP) based projects of major ports.
The tariff guidelines were issued by the Union Minister of Ports, Shipping and Waterways in the backdrop of the new Major Port Authorities Act, 2021 to be effective from November, 2021.
In the new Act, the provision of erstwhile Tariff Authority for Major Ports (TAMP) has been done away with for major ports.
Why is it needed?
- PPP concessionaires at major ports were forced to operate under the terms of these TAMPs, while private operators/ PPP concessionaires at non-major ports were free to levy tariffs on a market basis.
- At present, PPP concessionaires at major ports handle about 50 per cent of the total traffic that operates through all the major ports in India.
- The guidelines allow concessionaires at major ports to fix tariffs as per the market dynamics.
- The guidelines will also be applicable for future PPP projects. These also include projects which are currently in the bidding stage.
- The concessions in tariff provided by the Government for trans-shipment and coastal shipping will continue to be applicable for all future PPP projects.
- The royalty payable for trans-shipment cargo will now be 1.0 times (from 1.5 times earlier) of normal containers.
- Similarly, for coastal cargo, the concessionaire will have to pay only 40% (earlier 60%) of the royalty payable for foreign cargo.
Source – The Hindu