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A wide berth

By Sudesh Bhosle | B&C
The Mormugao Port is one of the oldest ports in the country and has been contributing to the economic development of Goa. Work on the port commenced in 1882, and in 1885 the first ship was berthed. Goa was at that time under the Portuguese rule. Initially there were only three berths and subsequently more berths were added. In 1888, the entire railway line up to the British frontier was commissioned. Mormugao Port was declared a Major Port in 1964.
With the emergence of mining as a major industry in Goa, Asia’s first Mechanical Ore Handling Plant was set up in 1959 at berth no-6 by a private firm. Even in those years, Mormugao Port could not build itself up as a general cargo port and concentrated on mineral exports for its sustenance.
With the rise of Brazil and Australia as aggressive ore exporters, the mineral ore industry underwent a sea change and also at the same time becoming exceedingly competitive. It became imperative to reduce transportation costs by providing deep water, high capacity loading facilities. The International demand for iron ore was also rising. Under this scenario, the port took action for creating dedicated iron ore handling facilities and in 1979 a highly sophisticated mechanical ore handling plant was commissioned incorporating some of the most advanced facilities including a custom designed barge unloading system. One of the unique selling points of MPT is that the entire ore which comes to the port comes through barges. This not only makes the pricing of the ore competitive but also serves to reduce the burden on the already choked road and rail networks.
MPT used to be the number one iron ore exporting port in the country. 80 per cent of the cargo handled at the port was iron ore. At its peak in 2010-11, the port handled about 50 million tonnes of cargo out of which iron ore comprised more than 40 million tonnes. During this period about 950 vessels visited the port of which about 600 were iron ore vessels. The mechanical ore handling plant employs more than 600 people which is more than 25 per cent strength of the port.
On October 5 2012, the Supreme Court of India imposed ban on the mining and transportation of iron ore in Goa. This was a serious setback for the port since a big chunk of its revenue is from iron ore handling. In the meantime, the reserves had eroded to an extent where salary disbursement was a big question.
Due to the sudden stoppage of Iron ore export by the Supreme Court, the mining activity had come to a standstill. During the current financial year Port has handled Iron ore of just 7.42 million tonnes only, whereas the total cargo handled was 16.71 million tonnes. Operating income from Iron ore has been the main source of income for the port.
MPT’s net surplus used to be around Rs 30 crore every year before stopping of Iron ore export. For all practical purposes, the income of the port had come to a halt since June 2012. MPT could manage its expenditure out of the savings it had so far. The average net deficit per month was about Rs 20 crore.
Due to use of reserves for meeting expenses, the port was left with meagre general reserves of only Rs 7.25 crore. The balance available reserve was exhausted in the following month and port was not in a position to pay even its salary, pension and other monthly commitments. Port committed payment of approximately Rs 43 crore up to March 31, 2013 and during 2013-14 there will be Rs 390 crore.
Port has already initiated measures to alleviate the impact of loss by initiating various economy measures. The management under its chairman P Mara Pandiyan initiated a slew marketing initiatives and several austerity measures were introduced on the other hand to control the expenditure. Port labour unions were also taken into confidence so that employees willingly cooperated with the austerity measures to recover from economic crises.
Pandiyan introduced a Special Voluntary Retirement Scheme (SVRS) in the port through which 62 employees were granted SVRS. He also conducted successful several trade meets in Belgaum, Hubli, Bagalkot and Bangalore in association with the Karnataka Chamber of commerce and Industry to diversify their cargo base at MPT, due to which the port started handling new cargo viz wheat, maize, granite and wood chips.
In the history of the port sector, MPT became the first major port to install Radiological Detection Equipments (RDE) to keep check on movement of nuclear, radioactive material from national security point of view.
Pandiyan stated that RDE has been installed to stop the illicit shipments of nuclear material. It also has handled devices to search and identify radioactive material, to find radiation sources and to monitor nuclear radiation.
Due to various initiatives, the port successfully attracted other users and handling new cargo like wheat, maize, granite and wood chips due to which the port’s financial position is improving, however, these is not substantial. Coal is a promising cargo and the port is creating additional facilities to boost coal imports. Because of the bottlenecks in the South Western Railway there are limitations here as well. However, in the next 3 to 4 years, MPT will create additional coal handling facilities for at least 10 million tonnes of coal.
MPT is catering to the EXIM trade of the region and contributing to about 30 per cent of Goa’s GDP.

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