To avoid delays in award of port projects, the finance ministry has asked the shipping ministry to stick to the basic framework of the bid document, also called the model concession agreement (MCA). With as many as 20 projects worth Rs 25,000 crore to be awarded this financial year, it was felt that the Planning Commission’s demands of the shipping ministry to make at least 30 different changes to the MCA which was finalised way back in January 2008 would create uncertainty amongst bidders and keep them away.

The intervention by the finance ministry is significant since it is the nodal ministry that approves public-private partnership projects in infrastructure sectors. The PPPAC (PPP Appraisal Committee), chaired by the Department of Economic Affairs secretary, approves PPP projects proposed by all infrastructure ministries such as roads, railways, power and shipping.

With the finance ministry putting its weight behind the shipping ministry, only a few specific changes might be made to the bid document, officials said. “As and when projects come up for award, objections were being raised by the Planning Commission. The finance ministry had to step in. We have said that only those changes may be made which do not change the basic structure of the current MCA,” a government official said.

When contacted, Gajendra Haldea, principal advisor (infrastructure) in the Planning Commission, said, “We have no objection to their following the approved MCA. However, the legal advisors of the commission have made some suggestions for tightening the language of some clauses, which the shipping ministry is entirely free to accept or reject.”

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