Friday, 14 December 2012

Goa struggles as mining ban bites.

With the Supreme Court ruling that the ban on mining in Goa is to continue, the port of Mormugao says it is in dire financial straits, struggling meet the salary and pension costs for its 2600 employees and 4000 pensioners.

“Our financial position is very precarious,” Deputy Chairman Biplav Kumar told LiveMint. We are currently earning about 10 crore per month without any iron ore.” Mormugao needs to generate Rs 15 crore a month just to pay salaries and pensions. “At this rate, our cash surplus will be depleted in another three months,” he added. The port was earning almost Rs 40 crore a month before mining was banned, when iron ore contributed 80% of the port’s cargo- 50 million tonnes per year at the peak. In contrast, no bulk carriers have called Mormugao since September this year.

With a 30 per cent revenue gap, the situation is so dire that the Goa Government plans to export ore that has been dumped at pit heads over decades. Chief Minister Manohar Parrikar told the Hindu Business Line that these dumps would be cleaned up over the next three to four months “taking due care of the legal formalities. We have huge ore dumps – some of six-decade vintage – dotting the State with tiny land mass and population. We need to clean this mess up,” he said.

Mormugao is now trying to move to other cargoes like food grains, pharmaceuticals and granite. The Food Corporation of India may export wheat through the State, and granite from Karnataka is being exported through the port after two decades, although there are complaints that infrastructure bottlenecks are holding things up.

 “These are the small things we are trying to do. Then, again, this will not give us that much money compared to what we were earning from iron ore,” said Kumar. “Besides, there are challenges in getting new cargo. The condition of the roads connecting the port with its hinterland in southern Maharashtra and northern Karnataka is very bad.”

The port is also getting ready two schemes to shed employees. An ‘Extraordinary leave scheme’ will allow them to take up jobs outside the port for up to six years and then return. Under another- a voluntary retirement scheme- employees who quit will be paid 45 days salary for each completed year of service. Kumar says the proposals are with the Shipping Ministry for clearance. 

Meanwhile, Chief Minister Parrikar is quietly critical of the ban that led to the crisis. “The irregularities (if any) were going on for years. Suddenly the pendulum swings to another extreme,” he said, talking about concerns about illegal mining in the State that led to the ban.

AJ Peters, Secretary of the All India Port and Dock Workers Federation, seems to agree. “Mormugao port is going through very difficult times, and a solution to this can come only from the Supreme Court which is hearing the cases related to mining in India,” he says.


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