PSA International’s bid to expand operations in India suffered yet another setback with the termination of a 30-year concession the Singapore-based terminal operator had shared with its local partner ABG Group for the management of the container terminal at the Port of Kandla, the country’s largest cargo handler in terms of tonnage.
The Kandla Port Authority issued the termination notice to ABG Kandla Container Terminal after the concessionaires failed to handle stipulated minimum traffic volumes in the past three years. The private terminal, which began operations in 2007, was 51 percent owned by ABG Infralogistics and the remainder by PSA.
“The license agreement signed with the firm provides for terminating the contract if it fails to achieve the minimum guaranteed throughput continuously for three years,” port officials said. “We will take over and run the container terminal operated by a consortium of ABG and PSA from April 1, 2013.”
KPA in a trade advisory Monday said it is in a position to provide customers with “seamless and efficient services” for their container ship calls at the port. “Kandla port is fully geared and equipped in all respects to handle container vessels and container yard operations from the date of taking over the container terminal without any interruption or disruption.”
The Kandla terminal offers a throughput capacity of 600,000 20-foot-equivalent units a year. According to the latest official traffic data, the terminal handled 106,000 TEUs from April 2012 to February 2013, down from 153,000 TEUs in the same period in previous fiscal year.
The Kandla contract termination follows the recent collapse of PSA’s $1.5 billion bid for construction of a fourth container terminal at the Port of Nhava Sheva (Jawaharlal Nehru), India’s busiest container gateway.