Major ports to be privatised in a phased manner
Private sector investments have been facilitated and 17 projects worth more than Rs 4,500 cr have already been approved and another 8 projects worth more than Rs 3,200 cr are under consideration
Union Finance Minister Yashwant Sinha, in his Union Budget for 2002-03 presented to Parliament on Thursday, said that the present Port Trust structure does not allow Indian major ports to have the flexibility needed for efficient management and for raising institutional funding.
It is therefore proposed to corporatise major ports in a phased manner. Private sector investments have been facilitated and 17 projects worth more than Rs 4,500 crore have already been approved and another 8 projects worth more than Rs 3,200 crore are under consideration.
With corporatisation of the existing ports and new private sector ports coming up, the regulatory structure will be strengthened.
Sinha informed the House that the Prime Minister’s National Highway Development Programme (NHDP) launched three years ago is progressing well. It now promises to achieve a totally new scenario in the road sector. The Golden Quadrilateral will be completed substantially by December 2003, a year ahead of schedule.
The North-South East-West corridors have a length of 7300 kms., of which 716 kms. have already been four-laned. With the assistance of multilateral funding, other borrowings by the National Highway Authority of India (NHAI) with government guarantee, and other innovative financing schemes, the funding for this phase will be fully tied up in 2002-03.
Sinha said the government has already announced its decision to upgrade the international airports at Delhi, Mumbai, Chennai and Kolkata to the standards of world class airports by inducting private sector management and investment through long term leasing systems. Modalities for inviting offers have been finalised and the leasing process will be completed in 2002-03.
Private sector participation in greenfield airports will be encouraged through a package of concessions:
1.Availability of land and related infrastructure from the State governments.
2. Exemption from levy of Inland Air Travel Tax (IATT) and Foreign Travel Tax (FTT) on departing passengers for projects located in States that charge sales tax on Aviation Turbine Fuel (ATF) at Central Sales Tax (CST) rate.
3.Charging of Advance Development Fee (ADF) by way of additional Passenger Service Fee (PSF) at the existing airports for help in financing of the greenfield airport.
4. Levy of User Development Fee (UDF) at the new airport.
5. Financial assistance/equity participation by Airports Authority of India.
The proposed new airports in Bangalore and Hyderabad will benefit from these concessions.
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