Context: Recently, the Inland Waterways Authority of India has eased tender terms for privatising the multi-modal cargo terminals at Varanasi, Haldia and Sahibganj on National Waterway 1.

Key Point

• The three multi-modal terminals were built by the waterways development agency on the 1,390-km along river Ganga with World Bank funding.
• The contracts will be awarded to the entity quoting the highest royalty per metric ton of riverine cargo handled at each of these terminals to IWAI.
• Additionally, for non-riverine cargo handled at the terminals, the private operator will have to pay royalty calculated on the royalty quoted for riverine cargo plus a premium of 20 per cent.
• The IWAI has set cargo and vessel related charges at these terminals.

Sahibganj Terminal

• Sabhibganj Terminal is in Jharkhand.
• IWAI issued a global tender seeking bids to privatize the Sahibganj multi modal terminal in Jharkhand for a 30-year concession to operate, manage and develop (OMD) the terminal.
• The private operator will be mandated to triple the terminal capacity.
• It will also undertake operation and management of the proposed Ro-Ro terminal at Sahibganj.

Varanasi Terminal

• An earlier plan by IWAI to bid it out on the OMD model failed to attract bidders.
• The Varanasi terminal was built by IWAI.

The private operator will be tasked with

• Operating, managing and maintaining the terminal infrastructure and the proposed passenger pontoon jetty.
• Equip terminal infrastructure for augmenting capacity to 1.26 mt.
• The Varanasi contract will have a tenure of 10 years which can be extended by two years (earlier ten plus five years).

Haldia Terminal

• The terminal at Haldia was built by IWAI.

Equip, operate, transfer (EOT) model

• The multi modal terminals at Haldia are being privatized on the Equip, Operate and Transfer (EOT) basis.
• As there is no scope for expansion of these terminals requiring capital investments.

The private operator will be mandated to:

• Operate, manage and maintain the terminal infrastructure
• To equip the terminal infrastructure for augmenting capacity to 3.07 mt.
• The Haldia contract will have a concession period of 10 years which can be extended by five years (earlier 15-plus 5 years).

Inland Waterway Authority of India

• It came into existence on 27th October 1986 for development and regulation of inland waterways for shipping and navigation.
• IWAI is the statutory body in charge of the waterways in India.
• Its headquarters is located in Noida, UP.
• Its main function is to build the necessary infrastructure in the inland waterways, surveying the economic feasibility of new projects and also carrying out administration and regulation.
• It undertakes projects for development and maintenance of IWT infrastructure on national waterways through grant received from Ministry of Shipping.