Mumbai: The Gautam Adani-controlled Adani Ports & Special Economic Zone Ltd (APSEZ), India’s largest port developer, said on Wednesday that it has received the so-called “letter of award” for development of the Vizhinjam International Deepwater Seaport Project from the government of Kerala.
The “total project cost” as estimated by Kerala government is Rs.4,089 crore and the time frame for commissioning of project is four years, which will be met by Adani Group based on its past execution record, APSEZ said in a statement.
The proposed port at Vizhinjam is located in Kerala, 16km south of the state capital Thiruvananthapuram.
On 13 July, Mint reported that the Congress-led United Democratic Front government in Kerala was awarding the port to APSEZ citing chief minister Oommen Chandy. A final agreement will be signed in 45 days, Mint had reported.
“We had keenly participated in this tender to ensure that Kerala gets its first deepwater multi-cargo port and India gets its first deep water transshipment port which has been missing till date. At present approximately 1.0 million TEUs (twenty foot equivalent units) of Indian cargo is getting transshipped through foreign ports like Colombo. Development of Vizhinjam port will help in cost saving to Indian trade as the boxes can be transshipped at a lower cost from Vizhinjam port,” APSEZ, a part of Adani Group, said in its statement.
Gautam Adani, group chairman, said the port is strategically located close to international shipping routes and could become the biggest transshipment hub in the region.
A container transshipment terminal acts like a hub, into which smaller feeder vessels bring cargo, which then gets loaded on to larger ships. Larger vessels bring about economies of scale and reduce the cost of operations for shipping lines, translating into lower freight rates for exporters and importers.
About 2 million TEUs, originating in and destined for India, get trans-shipped at Colombo every year. India has created and is looking to build more facilities that can help trans-ship containers within the country itself.
APSEZ also operates ports in Mundra, Hazira, Tuna-Tekra (Kandla) and Dahej, in Gujarat, Dhamra in Odisha and operates specialized coal handling facilities at Mormugao in Goa, and Visakhapatnam in Andhra Pradesh. It is currently setting up a container terminal in Ennore, Tamil Nadu.
