Newspaper claims Chinese barred from operating Indian terminals

New Delhi: In a serious blow to Hong Kong-based Hutchison Port Holdings, the Indian government has decided not to allow any Chinese company to invest in or manage any Indian port due to security concerns, the Times of India reported, citing unnamed sources. The decision seemingly shuts the door on HPH, the world's largest port operator, which has been looking at terminal prospects in both Mumbai and Chennai. India remains one of the largest missing pieces in HPH's otherwise massive global jigsaw.

The Times of India said the government has sent a confidential note to the chairmen of Mumbai and Chennai Port Trusts informing them that it had rejected Hutchison's applications, something Seatrade has confirmed from a source at one of the port trusts.

However, an HPH spokesperson denied the ruling telling Seatrade: 'In regards to India, HPH has not been rejected from participating in any port projects in India and we have in fact taken part in previous bids. HPH is interested in investing in the country. However, we have yet to identify a suitable investment that would meet our investment criteria.'

China's Kaidi Electric Power Company and Chinese Harbour Engineering Company, which have bid for Vizhinjam port in Kerala, will also meet the same fate as Hutchison, the paper said. The government's decision also eliminates future Chinese participation in 13 ports across India which are expected to see investments of about 610bn rupees, it noted. Bids for Mumbai's new terminal will now be accepted through till September 15.

HPH had entered bids for Indian concessions in partnership with Larsen & Toubro, a Mumbai engineering and construction giant. L&T has subsequently roped in the Philippines port operator International Container Terminal Services to replace HPH.

The stance taken by the Indian government is reminiscent of US Congress vetoing DP World's takeover of the American portion of P&O Ports earlier this year. India is belatedly playing a rapid game of catch up on the container terminal development side. [30/08/06]

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