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Business News/ Industry / Manufacturing/  Panel to discuss Krishnapatnam show cause notice on 22-24 January
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Panel to discuss Krishnapatnam show cause notice on 22-24 January

Krishnapatnam Port in Nellore, Andhra Pradesh is accused of violating coastal regulatory zone and environment rules

Krishnapatnam is the second private port to come under scrutiny recently on allegations of flouting environment and CRZ norms after Mundra port in Gujarat on India’s western coast. Photo: AFPPremium
Krishnapatnam is the second private port to come under scrutiny recently on allegations of flouting environment and CRZ norms after Mundra port in Gujarat on India’s western coast. Photo: AFP

New Delhi/Bangalore: The environment ministry has threatened to initiate action against Krishnapatnam Port Co. Ltd, the entity that runs Krishnapatnam port in Nellore district of Andhra Pradesh on India’s eastern coast, for violating environment and coastal regulatory zone (CRZ) rules.

Krishnapatnam is the second private port to come under scrutiny recently on allegations of flouting environment and CRZ norms after Mundra port in Gujarat on India’s western coast.

The environment and forest ministry had issued a notice on Krishnapatnam port last year directing the company to show why action should not be taken against the firm for the alleged violations. Mint has reviewed the notice.

The matter will be discussed at the next meeting of the expert appraisal committee (EAC), slated for 22-24 January, and the committee is likely to hold a discussion on the notice that was issued a year earlier, said a government official who requested anonymity.

Another government official said that an “internal process" of the environment ministry had been going on for the past year. “We cannot give details."

The notice, which was issued on the basis of reports submitted by the regional office of the ministry in Bangalore and by the special chief secretary of Andhra Pradesh, says that a building with helicopter landing facility was seen during a visit having direct access to the sea, “which has not been mentioned in the environment impact assessment (EIA) report or shown in the approved master plan".

The notice also says that nine bridges were constructed and two renovated by the project authorities though there is no mention of these in the report that was submitted to the ministry. The loco shed has been constructed without consent for establishment from the pollution control board. The loco shed is not a permissible activity under CRZ-1, it says.

“Therefore, under Section 5 of the Environment (Protection) Act, you are hereby directed to show cause within fifteen days of the receipt of this notice as to why action shall not be taken against the port management for the above violations," the notice says.

It adds that various representations were received against M/s Krishnapatnam port management alleging destruction of mangroves, reclamation of creek, unauthorized construction etc.

However, Krishnapatnam port refuted allegations of flouting environmental rules. “We are not only a greenfield port (new port) but also a green port. We are very serious about complying with all the environment rules and regulations. We have explained our position to the ministry on all the issues raised in the show cause notice," said Anil Yendluri, chief executive officer, Krishnapatnam Port Co.

Krishnapatnam Port Co. is 92% owned by Hyderabad-based CVR Group, which has interests in construction, ports, power, steel, information technology and exports. London-based private equity firm 3i Group Plc. invested $161 million (around 990 crore on Thursday) in the port in February 2009 through its India Infrastructure Fund for a 26% stake. 3i’s stake has since dropped to about 8% as valuations changed in the aftermath of the depreciation of the rupee.

Krishnapatnam, a port owned by the Andhra Pradesh government, was given to the CVR Group for development and operations on a 30-year contract beginning September 2004. The port contract can be extended up to 50 years (30+20).

The port, located 180km north of Chennai, currently has a capacity to load 40-45 million tonnes (mt) of cargo from 11 berths built with an investment of about 4,000 crore. It is one of India’s deepest ports with a draft of 18m and is capable of accommodating the biggest ships operating today.

Krishnapatnam Port Co. is in the midst of developing the second phase expansion of the port with an investment of about 4,000 crore to include more berths for loading coal, containers, liquefied natural gas, liquefied petroleum gas, chemicals, cars and general cargo, according to its website. The cargo handling capacity of the port will rise to about 65mt when the second phase expansion is completed.

Biswajit Mohanty, a former national board for Wildlife member and a board member of Greenpeace, an international organization which works on environmental issues said that the consent for establishment of the company should be revoked. “Penal action should be taken against the management under the Environment (Protection) Act," he said over the phone.

On 13 January, the Gujarat high court ordered shutting down of 12 industrial units at the industrial enclave run by Adani Ports and Special Economic Zone Ltd (APSEZ) at Mundra port in Gujarat citing lack of environment clearances. According to the court, APSEZ violated environment norms by allotting land to individual units without the mandatory environment clearance required under the Environment Impact Assessment notification of 2008. The court also directed the environment and forest ministry to decide on the environment clearance to the SEZ in 30 days.

In April 2013, a five-member committee headed by environmentalist Sunita Narain had suggested an environment restoration fund of 200 crore or 1% of total investment, whichever is higher, for environment violations by APSEZ at Mundra port.

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Published: 19 Jan 2014, 09:25 PM IST
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