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Journalism of Courage
Soon after Kerala Chief Minister on Sunday (October 15) flagged in the first-ever cargo ship at the under-construction Vizhinjam international seaport project, the country’s first deepwater transshipment port, a war of words was sparked between the ruling CPI (M) and Opposition Congress over the origin of the project. Meanwhile, the BJP has termed the reception for the ship a publicity stunt to create the impression that the project has been completed.
What is the Vizhinjam International Seaport Project?
The Rs 7,600 crore transshipment deepwater multipurpose seaport project is being built by Adani Ports and SEZ Private Limited on a design, build, finance, operate and transfer (DBFOT) model. The project has been in the pipeline for decades — different governments tried to develop but it was the Kerala Congress government in 2015 that finally inked a deal with the Adani Group.
According to the agreement, out of the total investment, Adani Group is supposed to invest Rs 2,454 crore and another Rs 1,635 crore will be mobilised from the state and central governments as viability gap funding.
The Kerala government has also gave 500 acres of land. The DBFOT deal is for 40 years, with provisions extending for 20 years.
What triggered the row between CPI(M) and Congress
A project vessel, Hong Kong-flagged heavy load carrier Zhenu Hua 15, carrying a ship-to-shore crane, docked at the seaport under construction on Sunday. It is meant for moving cargo from ships to the shore. Seven more such cranes will be brought from China in the coming months. The heavy loader carrier has also brought rail-mounted gantry cranes.
Docking of the heavy load carrier is considered a major milestone for such a project. To mark the occasion, the CPI(M)-led government organised an event, which wasn’t received well by the Congress and the BJP.
Why India needs a container transshipment port
India has 13 major ports. However, the country lacks a landside mega-port and terminal infrastructure to deal with ultra-large container ships. Hence, nearly 75 per cent of India’s transshipment cargo is handled at ports outside India, mainly Colombo, Singapore, and Klang.
In fiscal 2021-22, the total transshipment cargo of India was about 4.6 million TEUs (twenty-foot equivalent units), out of which about 4.2 million TEUs were handled outside India.
Developing a port into a Transshipment Hub will accrue significant benefits such as forex savings, foreign direct investment, increased economic activity at other Indian Ports, development of related logistics infrastructure, employment generation, improved operation/logistics efficiencies and increase in revenue share.
Several other allied businesses viz. ship chandlery-ship supplies, ship repair, crew change facility, logistics value-added services, warehousing and bunkering also come up at the transshipment port.
A deepwater container transshipment port can attract a large share of the container transshipment traffic which is now being diverted to Colombo, Singapore and Dubai. It can also ensure India’s economic development and open up immense job opportunities.
What are the features of the Vizhinjam port?
Located near Thiruvananthapuram, Vizhinjam would be India’s first international deepwater transshipment port with a natural depth of more than 18 meters, scalable up to 20 meters, which is crucial to get large vessels and mother ships.
It is designed to cater to container transshipment, multi-purpose, and break-bulk cargo. The port is located ten nautical miles from the international shipping route. Other features include minimal littoral drift along the coast and virtually no requirement for any maintenance dredging.
The port is expected to compete with Colombo, Singapore, and Dubai for winning trans-shipment traffic. The cost of movement of containers to and from foreign destinations is likely to come down. Its capacity in the first phase is one million TEU, which can be increased to 6.2 million TEU.
The project is expected to generate 5,000 direct job opportunities, apart from giving a boost to an industrial corridor and cruise tourism. Vizhinjam port offers large-scale automation for quick turnaround of vessels with state-of-the-art infrastructure to handle Megamax container ships.
Where the project stands — and the missed deadlines
As per the latest assessment, 65.46 per cent of the project is done. The construction of 2,960 meter breakwater has achieved 68.03 per cent progress. Dredging and reclamation are at 68.51 per cent and construction of the berth has gained a progress of 82.53 per cent.
After inking the deal in 2015, Gautam Adani promised that the project would be made operational in 1,000 days and the port would handle 20 million tons of cargo by 2020. However, it has missed deadlines several times since 2019 mainly due to the delay in the construction of the breakwater. The 2017 Ockhi cyclone, the Covid-19 pandemic, the acute shortage of granite boulders to build a 3.1-km breakwater and last year’s fishermen’s protest contributed to the delay. As per the latest work schedule, the first phase of the project is slated to be operational in December 2024.
