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DPA tendered ultimatum to DP World

DPA tendered ultimatum to DP World

Deendayal Port, which manages the Kandla port in Gujarat, is urging DP World Ltd, a global port operator, to sign a concession agreement by the end of July. This agreement is for a large container terminal that DP World won the rights to operate at the Tuna Tekra satellite facility of Deendayal Port.

The signing of the concession agreement has been delayed due to a public interest litigation (PIL) that aims to cancel the environment clearance granted to Deendayal Port for its expansion projects, including the one at Tuna Tekra. However, Deendayal Port wants DP World to commit to the agreement despite this legal challenge.

The competition for the contract to operate the container terminal was fierce. Hindustan Infralog Pvt Ltd outperformed Adani Ports and Special Economic Zone Ltd (APSEZ), India’s largest private port operator, to secure the deal. DP World, which is owned by the Dubai government, offered the highest royalty of Rs6,500 per twenty-foot equivalent unit (TEU) to win the bid, surprising the ports industry. In comparison, APSEZ’s bid was Rs1,500 per TEU.

The planned container terminal is expected to have a capacity to handle 2.19 million TEUs annually and will require an investment of Rs4,243.64 crore to construct from scratch. Now, Deendayal Port is putting pressure on DP World to finalize the concession agreement promptly, allowing the project to move forward.

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