Congress leader Jairam Ramesh has alleged that Adani Ports is trying to gain a monopoly in Gujarat’s port sector harming competition and pushing up prices for the common man. 

Sharing his views on X, the Congress spokesperson said how the government extended the Build-Own-Operate-Transfer (BOOT) agreement with the Adani Group.

The government grants private ports a 30-year concession period on a BOOT basis, after which, the ownership gets transferred to the government. Based on this model, Adani Ports controls Mundra, Hazira, and Dahej ports. 

According to Ramesh, “Before the 2024 Lok Sabha Elections, Adani Ports requested the Gujarat Maritime Board (GMB) to extend this concession period by another 45 years to 75 years in total. This was much beyond the maximum permissible period of 50 years, but the GMB hastened to request the government to do so anyway. The GMB was in such a hurry that it did so without approval from its Board, resulting in the file’s return.

“The GMB initially recommended that the Gujarat government protect its revenue interests by either inviting new bids or renegotiating financial terms with Adani after the 30-year concession period. However, under pressure from a ‘tempo-wallah’ who opposed the idea of competition, the GMB Board revised its decision.”

“The updated recommendation was to extend the concession period for Adani without seeking new bids or renegotiating terms. The chief minister and other officials then expedited the approval process to ensure the proposal was implemented,” alleged Ramesh.

What can be the consequences?

As emphasised by Ramesh, “Adani Ports will secure a monopoly on Gujarat’s port sector, harming market competition, and driving up prices for the common man. Adani Ports will see its valuation rise and borrowing costs fall.”

“By failing to open up the process to a renegotiation or competitive bidding, the Government of Gujarat will lose crores of rupees in revenues,” he added.

He concluded that the Joint Parliamentary Committee (JPC) investigation is essential in this matter.

The demand to extend the lease of Mundra Port, which is set to end on February 31, 2031, seems puzzling given that the initial agreement allows the company to recover its investment and interest over 30 years.

The current request for an extension of an additional 45 years may indicate a desire to further increase profits beyond the agreed period. After gaining approval from the Gujarat Maritime Board (GMB), the proposal was forwarded to the government, reflecting the company's push for a longer tenure to maximise returns.

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