PowerTrain's video: Why Modi Ji s Office Opposing Vadhavan Mega Port

After navigating strident opposition from green groups, fishermen and locals, the mega port planned at Vadhavan in Maharashtra’s Palghar district is facing a last minute ‘structuring’ challenge with the Prime Minister’s Office (PMO) floating an idea to adopt the Hybrid Annuity Model (HAM) – widely used in highways – for implementing the Rs76,220 crores project. “At the suggestion of the PMO, we are looking at the HAM model for developing Vadhavan Port,” a senior government official said, asking not to be named. The PMO’s suggestion has spooked those tracking and involved in the project as it came when the Ministry of Ports, Shipping and Waterways piloted the final investment proposal to the Union Cabinet after securing nod from the Public Investment Board led by T V Somanathan, Finance and Expenditure Secretary, Finance Ministry, as well as the key environmental and coastal regulation zone clearances from the Ministry of Environment, Forest and Climate Change, all in February. The 298 million tonnes (mt) capacity a year port will be constructed by Vadhvan Port Project Ltd, a joint venture between state-owned Jawaharlal Nehru Port Authority (74 percent stake) and Maharashtra Maritime Board (26 percent equity), in two phases under the landlord model, per the government policy. In the landlord port model widely followed globally, the publicly governed port authority acts as a regulatory body and as landlord constructing the basic infrastructure such as breakwater, reclamation and dredging, while cargo handling operations are outsourced to private firms on a public-private-partnership (PPP) mode. The landlord port, in return, gets a share of the revenue from the private operators. The “last minute suggestion” from the PMO has stalled Cabinet clearance for the project which was expected before the dates for the ensuing Lok Sabha polls were announced by the Election Commission. The Cabinet approval now will have to wait till a clarity emerges on the model to be adopted for constructing the new port and after a new government assumes office in June. If the HAM model is approved, it will be the first for a port project, necessitating a large-scale restructuring of the Vadhavan project parameters. Under the HAM Model followed by the National Highways Authority of India (NHAI), the private operator will be picked on the basis of the life cycle cost (net present value of the project cost plus NPV of the O&M cost for the entire operations period). THUMBNAIL IMAGE IS AI GENERATED SOURCE - https://infra.economictimes.indiatimes.com/news/ports-shipping/cabinet-nod-for-mega-vadhavan-port-stalled-as-pmo-floats-ham-model-for-development/108641075