Mumbai Port opens land to ramp up its earnings

Mumbai Port Trust (MbPT) has opened up its vacant land within the port premises for Cochin Shipyard Ltd (CSL) as well as Jawaharlal Nehru Port Trust (JNPT) to increase its revenue stream.

The ship repair facility at MbPT will be modernised and given to Cochin Shipyard for operation and management for a premium. MbPT would also allow bringing containers from JN Port via barges, a move that would raise its earnings from warehouses.

Starting this May, MbPT and CSL will associate with each other for utilising the Indira Dock facility at the Mumbai Port to set up ship repair facility, which would be beneficial for Indian commercial as well as defence ship repair industry. CSL is expected to provide end-to-end ship repair solution to ship owners.

This facility at Indira Dock will be expanded at an estimated cost of Rs 80 crore and may include setting up of a floating dry dock (FDD) and upgrading existing facility at Hughes dry dock.

The existing dry dock facility was built over a century ago in 1914. Presently, it is an active area that is given out on lease to ship owners.

"Hughes dry dock and four berths at Indira Dock will be given to CSL for 30 years, wherein MbPT will earn annual revenue of around Rs 15 crore with an annual escalation of 2.5%. There will be profit share of 5% on profit after tax for the initial four years and 7.5% thereafter," said Sanjay Bhatia, chairman of MbPT.

As for the agreement with JNPT, coastal cargo movement will be initiated between the two ports, wherein JN Port will provide a special yard and a shallow berth for the Mumbai Port-bound traffic. During the initial stages, the container yard and the shallow berth will be operated by JNPT, and later on, an operator will be appointed through a public-private partnership (PPP).

At present, around 1,500 containers ply from JN Port to Mumbai via 140 kilometre-long JNPT-Panvel-Bhiwandi-Thane-MbPT route, leading to congestion.

MbPT and JNPT share a common channel and are situated on either side of the channel.

"Barge operators will take containers from JN Port to barge berths at Mumbai Port. We along with Customs Department will provide green channel for these containers to be transported out of Mumbai Port area. We will also provide rail and road transport facilities apart from providing our own warehouses and those established through PPP (to be appointed later) for these containers," said Bhatia.

For now, New Sewree Warehouse at MbPT, spread over 24,000 square metres, has been earmarked for the project. If the arrangement works well, another 30,000 sq mt will be added. Completion of the first phase has been scheduled for May 2018 and overall timeline to complete the project is May 2019.

MAKING SPACE

• Indira Dock will be given to CSL for 30 years, wherein MbPT will earn annual revenue of around Rs 15 crore with an annual escalation of 2.5%. There will be profit share of 5% on profit after tax for the initial four years and 7.5% thereafter
   
• As for agreement with JNPT, barge operators will take containers from JN Port to berths at Mumbai Port. For now, New Sewree Warehouse at MbPT, spread over 24,000 square metres, has been earmarked for the project