Explained: Why Kolkata Port Trust is leasing out land parcels as big as London Docklands
New Delhi, Feb 26: Kolkata Port Trust (KoPT) now renamed Syama Prasad Mookerjee Port is looking to lease out more of this 20 land parcels on a long-term basis to boost profit.
In an interview at his office in Kolkata, Vinit Kumar, Chairman said that Kolkata Port which owns about 4,500 acres in West Bengal (18 square kilometers) which is roughly the size of the derelict London Docklands, but uses only about 2,000 acres for its own operations.
"We plan to gainfully utilize this land bank. The focus is on improving operations, augmenting capacity and also diversification'' Kumar said.
Some of these land parcels are unused while some were in use till recently but vacant now, he added.
The 150-year-old Kolkata Port will be offering two models of payment for the lease in order to focus on improving profitability after years of high costs.
For the first time in 15 years, India's oldest operating port had reported a profit of 600 million rupees in the last financial year due to rising cargo volumes, more efficient handling, and lower staff costs.
KoPT reduced headcount to about 3,600 from 6,000 ten years ago, and over the past five years it has created a 35 billion rupee fund that will be managed by Life Insurance Corporation of India for its 23,000 pensioners.
"We expect better profit next financial year. The economic slowdown has not impacted us much -- we are still growing,'' Kumar said to the Bloomberg.
KoPT with its two Dock Systems Haldia Dock Complex (HDC) & Kolkata Dock System (KDS) is the gateway to Eastern India for the rest of the world.
The firm already rents out some land to 22 companies including Indian Oil Corporation Ltd., Tata Steel Ltd., Hindustan Unilever Ltd., Bharat Petroleum Corporation Ltd., Tata Chemicals Ltd.
The firm rent income of about 3 billion rupees ($42 million) accounted for 12% of Kolkata Port's revenue for the year ended March 2019 and Kumar aims to double lease earnings in the coming years.