Ministry of Shipping Proposes New Model Concession Agreement for Port Sector
The Ministry of Shipping has proposed a new Model
Concession Agreement (MCA) for the Port Sector.
Key facts:
Key facts:- The proposed MCA will
replace the existing Model Concession Agreement which came into existence
in January, 2008.
- The proposed MCA has taken into
account the suggestions provided in various reports by Member Planning
Commission (2010), Indian Ports Association (IPA-2015) and Kelkar
Committee Report (2015).
The objectives of the revised Model Concession
Agreement are following:
- More equitable allocation
of project risks.
- Provisions to handle
unforeseen circumstances.
- Removing ambiguity in
existing provisions.
- To attract more private
sector investment.
The salient changes proposed in the Revised
Model Concession Agreements are:
- Change in equity holding to
provide exit route.
- Providing for refinancing
provision in MCA.
- Amendment in Definition of “Change
of Law”.
- Provision for mid-term review of
concession.
- Approval of Discounts on Ceiling
Rates for the Purpose of Recovery of Revenue share.
- Improved Utilization of Project
Assets and Higher Productivity.
- Grievance Redressal System.
- Provision for Additional Land,
Utilities & Services.
Replacement of “Actual project Cost” with
“Approved Project Cost.
