Indian government okays revised concession pact for PPP projects at ports

  Jan.9--THE Indian government has approved a revised model concession pact for public private partnerships (PPP) to make the investment climate more investor friendly reports the Press Trust of India.

  The revised Model Concession Agreement (MCA) includes providing an exit route to developers by way of divesting their equity up to 100 per cent after completion of two years from the commercial operation date (COD), similar to the MCA provisions of the highway sector.

  "The Union Cabinet chaired by Prime Minister Narendra Modi has approved amendments in the Model Concession Agreement to make the port projects more investor-friendly and make investment climate in the port sector more attractive," said a statement from the Ministry of Shipping.

  The amendments in the MCA envisage constitution of the Society for Affordable Redressal of Disputes - Ports (SAROD - PORTS) as dispute resolution mechanism similar to provision available in highways sector.

  The government said under provision of additional land to the concessionaire, land rent has been reduced from 200 per cent to 120 per cent of the applicable scale of rates for the proposed additional land.

  "Concessionaire would pay royalty on 'per MT of cargo/TEU handled' basis which would be indexed to the variations in the WPI annually," the statement said.

  This will replace the present procedure of charging royalty which is equal to the percentage of gross revenue, quoted during bidding, calculated on the basis of upfront normative tariff ceiling prescribed by Tariff Authority for Major Ports (TAMP).


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