Port Sector: DPW’s Indian arm to bring in more FDI
In its latest move, the Union Cabinet has approved the creation of Indian shareholders of Dubai Port World - Hindustan Ports Private Limited (HPPL)
Through DPW's Indian arm, the government is hopeful of drawing more private investment into port sector.The Union Cabinet on Friday gave its nod to the decision that proposed the creation of an Indian shareholding company to deal with container terminal projects of Dubai Ports World (DPW) in major Indian ports.
“This allows for the creation of an Indian holding company of DPW with unique asset portfolio to operate and manage the terminal operations at the existing major ports subject to certain safeguards...will also help in better coordination and control as the port authorities have to deal with a single company registered in India,” said an official release.
Through this decision, the government is also hopeful of drawing more private investment into the port sector.
The Government is of the view that the decision would lead to flowing of Foreign Direct Investment (FDI) into the country, besides ensuring investor-friendly environment in the country’s port sector.
“DPW intends to expand the capital base and enable fresh investments in ports and logistics infrastructure in India. This will enable efficient access of finance and introduce latest technology in port operation,” the release added.
This may also lead to greater transparency and better compliance to Indian laws and regulations.
The Government accepted the proposal with subject to the condition that ‘net worth of Indian shareholder of DPW- Hindustan Ports Private Limited (HPPL), should be more than $80 million post acquisition of the shares of project SPVs.'
The Cabinet move comes in the backdrop of efforts made by DPW to expand its base in the Indian port sector.
“DPW Limited is contemplating restructuring of its assets in India with the objective of consolidating ownership of its port infrastructure into a single holding company namely, Hindustan Ports Private Limited (HPPL),” the release added.
While the new company would takeover liabilities of existing subsidiaries, the ultimate beneficiary and legal ownership would lie with DPW.
March 11, 2016 | 04:00pm IST
to success.