Bhubaneswar, Sept. 26: The slump in mining activities, a possible fall out of the multi-crore mining scam, has cast a shadow on the future of ports in the state.

Uncertainty is haunting, among others, the newly built Dhamra port, the second biggest in the state after Paradip and one of the deepest in the country.

Inaugurated on December 18 last year by chief minister Naveen Patnaik, Dhamra port, a joint venture between Tata Steel and Larsen & Toubro Limited (L&T), was supposed to herald a big change in the state’s economy by catering to the vast mineral belt of Odisha, Chhattisgarh, Jharkhand and Bengal.

However, the mining slowdown seems to have cast a spanner in its plans with speculation arose about L&T planning to offload its stakes in the company. Though the Tatas have reportedly ruled out exiting the Dhamra project, the suspense over the future of the company continues to build.

Sources said the problems of Dhamra port stemmed from the drastic fall in Odisha’s mining activities with more than 200 mines out of operation at the moment. Since ore exports constitute the backbone of port operations in the state, not only Dhamra, which, according to reliable sources, has incurred a loss of around Rs 450 crore in its first year of operation, but also other ports are feeling the pinch.

The cargo handling even at Paradip port has come down drastically. Sources said that in the first quarter of the current fiscal (April-June), the port handled six million tonnes of cargo against 13 million tonnes during the corresponding period in the last financial year. The port, it seems, will struggle to meet its target of handling 63 million tonnes of cargo this year because of the steep fall in mining activities.

What is worse is that the Centre has asked state governments to ensure that iron ore extracted from mines leased out for captive use is not sold either in the country or abroad. “Such a direction is bound to affect export business and ultimately operation of the ports,” said a top-notch industrialist.

The state government, however, sought to downplay speculation over Dhamra port, stating that it had not received any proposals from the Dhamra Port Company Limited board or from Tata or L&T in this regard.

Commerce and transport minister Subrat Tarai said: “We have not received any proposal from them. If one comes, we will examine it.”

As it is, it was the mining boom in 2004 that had prompted the state government to launch a hunt for right places along the coast to set up new ports. As many as 13 sites — the Subarnarekha mouth, Bahabalpur, Bahudamuhana, Bichitrapur, Palur, Balaharchandi, the Barunei mouth, Chandipur, Astaranga, Jatadhar Muhan, Talsari, Inchudi and Chudamani — were identified.

The Tamil Nadu-based Creative Ports Limited had signed an MoU to set up a port at Subernarekha, but the work on the project is yet to begin. For Astaranga port, the Hyderabad-based Navayuga Engineering has inked an MoU with the government. On the other hand, Chudamani port and the proposed captive port for Posco’s 12 million-tonne steel plant remain embroiled in controversies.

Even director of ports Subrat Rout did not appear optimistic about the future of the upcoming ports in the state. “There has not been much progress in the port sector. But, we hope things will change for the better,” he said.