Hutchison Ports back, may invest in Gujarat

Hutchison International Ports Holdings, a wholly owned subsidiary of the Hong Kong-based Hutchison Whampoa, is looking at entering the Indian port sector following the government's decision to allow 100 per cent FDI.

The company had in 2002 submitted a bid to develop the Jawaharlal Nehru Port Trust's bulk terminal in Mumbai, but had to withdraw later as the BJP-led National Democratic Alliance was not keen on allowing a Chinese entity into Indian ports.

This week, Hutchison signed a memorandum of understanding (MoU) with the Gujarat Maritime Board (GMB), the nodal agency for the port sector in Gujarat, to conduct a feasibility study for two ports at Mithivirdi and Mahuva in the Bhavnagar and Surendranagar districts, respectively, in the state.

GMB officials believe Hutchison could end up making significant investments in Gujarat ports, a few of which are on the block.

"In a few days from now, Hutchison will start carrying out feasibility study at Mithivirdi and Mahuva and we are optimistic that the largest company in the sector would be able to set up shop in India," H K Dash, chief executive officer of Gujarat Maritime Board, said on Monday.

Hutchison officials in Singapore did not offer comment on the development.

When asked whether Hutchison officials harboured any apprehensions about investing in Gujarat ports considering their experience with JNPT, Dash said, "If the need arises we would take the matter up with the Centre and request it to consider Hutchison Port's proposal positively as it would not only bring in huge investment but also generate lot of local employment."

Dash declined to divulge further details of discussions between the Gujarat Maritime Board, the Gujarat government and Hutchison Ports, saying, "This particular development is sensitive in nature."

The Gujarat Maritime Board has carried out extensive pre-feasibility studies through Danish firm Ramboll Inc and the New Delhi-based Holtec Consulting Engineers for the Mithivirdi port site.

The study said an investment of Rs 411 crore would be required in the first phase of development of the port.

However, the estimated investment is excluding expenses for breakwater. Mithivirdi is located 40 km south of Bhavnagar and 10 km north of Alang, the world's largest ship-breaking yard.

At full tilt, the port is expected to handle eight million tonne of cargo "" sometime in 2006. Mahuva, also close to Bhavnagar, is expected to handle almost the same amount of cargo, again in 2006.