JNPT to award Rs 800-cr dredging contract by Aug-end

The Jawaharlal Nehru Port Trust (JNPT), which handles over 60 per cent of container traffic of India, is likely to award the much-delayed Rs 800-crore dredging contract by August-end. The lowest bidder for the project, Van Oord of the Netherlands, has set a deadline of September 1.

The JNPT Board on Thursday approved the proposal of Van Oord, which is now awaiting clearance from the shipping ministry.

"Since the cost estimates of the proposed project have gone up, JNPT will have to take multiple approvals from the ministry. However, the port will also have to secure approvals as there is a deadline set by the lowest bidder for the project," a source said.

To be funded from the port's internal accruals, the project would increase the channel depth from 12 metres to 14.5 metres. JNPT's neighbouring port Mumbai Port Trust may also give some financial assistance for the project.

Dredging is the process of deepening a shipping channel to enable the port to accommodate bigger ships. Globally, shipping lines prefer to deploy larger vessels to enjoy the economies of scale but Indian ports are facing constraints owing to lesser depth of their shipping channels.

Normally, this type of dredging can be done in 27 months from the award of the contract.

At present, JN Port, which is the largest container port in India, handles bigger vessels by making use of tide. When the channel gets dredged, the port will be able to handle 14-metre draught vessels (which can carry 6,000 20-feet containers).

JNPT officials declined to comment even as Van Oord executives confirmed that the firm is the lowest bidder.

Van Oord emerged as the lowest bidder competing with three other international dredging companies "" Boskalis, Jan De Nul and Dredging International.

Industry analysts point out that this dredging project is crucial as India is losing out to ports of Singapore, Sri Lanka and Dubai that handle bigger ships which offer direct and long haul services to major international locations.

Last year, JNPT was ranked as 28th leading container port of the world.