‘Imprudent to sell AP stake in Gangavaram port to Adani Group’
Visakhapatnam: Former Secretary to the Central Government, EAS Sarma, has called upon the Andhra Pradesh government to revoke its decision to sell away its equity in Gangavaram Port to the Adani Group in public interest. Expressing his serious concerns about the manner in which the state government had chosen to part with its equity share […]
Visakhapatnam: Former Secretary to the Central Government, EAS Sarma, has called upon the Andhra Pradesh government to revoke its decision to sell away its equity in Gangavaram Port to the Adani Group in public interest.
Expressing his serious concerns about the manner in which the state government had chosen to part with its equity share of 10.4 per cent in Gangavaram port, he addressed a letter to the Chief Secretary Adityanath Das here on Friday, saying that the sale would not only take away the strategic role that the State should play in the affairs of Gangavaram Port in terms of the original PPP model but also would indirectly help the Adani Group to get monopolistic control over the strategic AP coast in view of its earlier acquisition on similar lines of the control over the Krishnapatnam Port.
“Gangavaram Port has been enjoying several concessions given to it in the past by the State government. For example, the port had been granted exclusive economic zone rights over the sea front, much more than a public sector port like Visakhapatnam Port enjoys. Combined with similar exclusive waterfront rights of Krishnapatnam Port, the Adani Group will not only enlarge its control over the east coast but also eliminate competition from the others. From this point of view, it is highly imprudent for the State to have decided to sell away its strategic equity share in Gangavaram Port to the Adani Group,” Dr. Sarma pointed out.
Referring to reports that the State government was selling away its entire equity share of 10.4% in Gangavaram Port for a paltry amount of Rs 645 crore, apparently on the basis of the contrived justification that the Adani Group had purchased the shares in that port from the other shareholders at the same value, he said it was a highly objectionable and unacceptable basis for valuing the equity of the government for many reasons. While one did not know the basis for other shareholders parting with their shares to Adani Group at Rs.120 per share, he felt that had the government gone into the open market, called for bids for its equity share of 10.4% in a transparent manner through the international bidding route, it would have arrived at a more realistic share price discovery to its own advantage.
Also, from the point of view of the Adani Group, acquiring the 10.4% equity share of the State government had a higher strategic value compared to acquiring shareholding from the other shareholders because, it had already acquired control over the Krishnapatnam Port not far from it along with the exclusive marine economic zone rights which gave that group a near monopoly over the waterfront of a fairly long stretch of the east coast. In addition, this will also give it a decisive edge over the other bidders seeking to acquire the Visakhapatnam Steel Plant which is under the disinvestment anvil, he opined.
“It appears that the Adani Group is a strong contender for the Visakhapatnam Steel Plant from the indications that are generally available. If this is going to be case, it is a matter of public concern that the State government which has opposed all along the privatisation of the steel plant on paper to appease the people of north AP should indirectly pave the way, apparently in connivance with the Centre, for bringing in the Adani Group as the private owner of the steel plant. From the chronology of the events taking place, it looks as though that the Centre, in collusion with the State, has set the ground for handing over the Visakhapatnam Steel Plant to the Adani Group,” Dr. Sarma remarked.
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