The cabinet on Thursday approved strategic sale of government stake in Dredging Corporation of India (DCIL) to consortium of four ports. The government currently holds 73.44 per cent in the company.
“The cabinet committee on economic affairs (CCEA) has given in principle approval for strategic disinvestment of 100 per cent government share in DCIL to consortium of 4 ports, namely Vishakhapatnam Port Trust, Paradeep Port Trust, Jawaharlal Nehru Port Trust and Kandla Port Trust,” an official tweet said.
The approval will further facilitate the linkage of dredging activities with the ports, keeping in view the role of DCIL in expansion of dredging activity in the country as well as potential diversification of ports into third party dredging, the tweet said after the meeting of CCEA chaired by prime minister Narendra Modi.
“The co-sharing of facilities between the company as well as ports shall lead to savings for ports. This would further provide opportunities for larger investment in DCIL as integration with ports shall help in effective vertical linkage in the value chain,” the tweet added.
The government has budgeted to raise Rs 80,000 crore from public sector (PSU) disinvestment. So far this financial year, the government has mopped up over Rs 15,000 crore from PSU stake sale.
The cabinet also approved filling up of the underground strategic oil storage at Padur in Karnataka by foreign oil companies, who could use it as storage for trading in the region but will have to part with the oil in case of an emergency in India, said law and IT minister Ravi Shankar Prasad after the cabinet meeting.
Padur storage has four compartments of 0.625 million tonnes each.
India has build 5.33 million tonnes of emergency storage in underground rock caverns in Mangalore and Padur in Karnataka and Visakhapatnam in Andhra Pradesh. While a third of the Visakhapatnam Hindustan Petroleum Corp and Abu Dhabi National Oil Co have hired facility and the government has filled the storage at Mangalore. The 2.5 million tonnes Padur facility remains empty.
“The filling of the strategic petroleum reserves under public-private-partnership model is being undertaken to reduce budgetary support of the government,” an official statement issued after the meeting said.
Indian Strategic Petroleum Reserves (ISPRL) has constructed and commissioned underground rock caverns for storage of total 5.33 million tonnes of crude oil at three locations – Vishakhapatnam (1.33 million tonnes), Mangalore (1.5 million tonnes) and Padur (2.5 million tonnes).
The total 5.33 million tonnes capacity under phase-I of the SPR programme is currently estimated to supply about 9.5 days of India’s crude requirement.
Prasad said the storing of oil by foreign firms would help save the government Rs 10,000 crore in filling cost.
In the phase-II, India plans to build an additional 6.5 million tonnes facilities at Chandikhol in Odisha and Padur in Karnataka, which is expected to augment the emergency cover against any supply disruption by another 11.5 days.
Oil traders and producers could use the Padur storage to stock their oil and sell it to refineries in the region on commercial terms. India, which meets 83 per cent of its oil needs through imports, will have the right of first refusal to buy the crude oil stored the facilities in case of an emergency, he said.
Indian refiners maintain 65 days of crude storage, and when added to the storage planned and achieved by ISPRL, take the Indian crude storage tally to about 87 days. This is very close to the storage of 90 days mandated by IEA for member countries.
In another significant decision, the cabinet approved a proposal to manage Ahmedabad, Jaipur, Lucknow and three other airports under the public private partnership (PPP) model. The three other aerodromes are those at Guwahati, Thiruvananthapuram and Mangaluru.
The operation, management and development of all these aerodromes, owned by the Airports Authority of India, would be done under PPP, an official tweet said.
This would be done through the public private partnership appraisal committee (PPPAC). Any issue that is beyond the scope of PPPAC would be dealt with by an empowered group of secretaries, the tweet said.
The Niti Aayog chief executive officer would head the group. Secretaries of the civil aviation ministry, the department of economic affairs and the department of expenditure would be part of the group.