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P. Manoj

NEW DELHI, June 16

VISAKHAPATNAM Port has notched up the number one slot in cargo handling among the major ports for the second successive year by clocking 46 million tonnes of cargo during 2002-03. The port had handled 44.3 million tonnes of cargo in 2001-02. But, the port trust management is not resting on its laurels.

The non-major port of Kakinada is close on its heels, eyeing Vizag's cargo. Besides, there is intense competition between the major ports of Paradip, Haldia and Vizag which share the same hinterland for cargo, particularly coal. The development of a new port at Gangavaram is another ominous sign, though the port trust says that it "cannot be a competitior to Vizag".

Given this scenario, Vizag port has introduced a volume discount scheme for importers and exporters patronising the port from April 1 to attract more cargo. The Scheme has the approval of the Tariff Authority for Major Ports (TAMP).

An importer/exporter who had handled a minimum of 50,000 tonnes of dry cargo or 10,000 tonnes of liquid cargo in the immediate preceding financial year will qualify for the volume discount scheme.

The average cargo-wise throughput achieved by an importer/exporter during the preceding two years will be the benchmark for the volume discount scheme. For importers/exporters who handled cargo only in 2002-03, the benchmark for the discount scheme will be the throughput achieved by them in the year 2002-03.

The average of throughput for 2001-02 and 2002-03 will form the benchmark for the years 2003-04 and 2004-05. Thereafter, the benchmark will be revised by the port taking into account the average of the immediately preceding two years.

New importers/exporters in 2003-04 will become eligible for the volume discount scheme only in 2005-06.

The port trust will give a discount on wharfage of 10 per cent if an importer/exporter gives a cargo throughput which is above 110 per cent and up to 120 per cent of the stipulated benchmark, a 15 per cent discount on wharfage if the cargo throughput is above 120 per cent and up to 130 per cent of the benchmark and 20 per cent discount on wharfage if the throughput is above 130 per cent of the benchmark.

In the case of iron-ore traffic, the discount will be allowed only on the wharfage element of Rs 26.20 per tonne and not on the tippling and haulage charges.

While approving the volume discount scheme, TAMP had noted that it was more of a tariff incentive scheme aimed at existing users to improve the volumes of Vizag port.

"The Scheme is to provide some relief to the users on the additional throughput brought by them," TAMP had said in its recent order.

The port trust has indicated a notional financial implication of Rs 1.38 crore for 2002-03 on account of volume discounts. If the existing growth trend continued in 2003-04, there may be a similar financial implication in the year 2003-04 also.

But, this cannot be strictly termed as revenue loss to the port as the discounts will be on additional throughput only. And, if there is additional throughput of cargo, it will result in generation of more revenues to the port from other associated activities which may offset the reduction in revenue due to discounts allowed on wharfage.

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