NEW DELHI – Labor unions at the Port of Chennai have threatened to strike if management signs an agreement giving control of its container terminal to P&O Ports.
The port in July selected P&O Ports as the preferred bidder to manage and operate a container terminal at the southern Indian port. The 30-year agreement is expected to be signed on Sept. 26.
But six unions oppose the agreement, saying it is against the interests of the port and workers.
“If Chennai port signs the agreement, it stands to lose revenue of 1. 3 billion rupees ($28. 5 million) a year,” said G. Kalan, general secretary of the Chennai Port and Dock Workers Congress.
He said P&O Ports also would receive port assets worth $140 million. According to the unions, P&O Ports will employ only 550 workers out of 1, 200 workers who now work at the terminal. Kalan said workers also would lose pension and other benefits.
The unions say there is no need for a foreign company to handle containers at Chennai, and say that productivity is increasing.
P&O Ports was one of three finalists that the Indian government pursued for operating the Chennai terminal. The other two were PSA Corp. of Singapore and Hutchison International Port Holdings Ltd. of Hong Kong.
The government insisted on several non-negotiable terms and conditions and a package of guarantees. P&O Ports has agreed to guarantee minimum traffic over the 30 years and is committed to bringing mainline vessels within three years after the start of operations. It also has promised a minimum level of investment and agreed to take over the existing terminal with equipment and labor.
India decided to privatize the terminal as part of a plan to make two ports – one on the east and west coasts – into hub ports. The two ports are Chennai on the east coast and Jawaharlal Nehru on the west.
P&O Ports has not responded to the strike threat. But it said earlier that Chennai’s strategic position and strong growth rates would add to P&O Ports’ strategy for developing a regional network of container terminals servicing the Asian market.
