The Kerala government wants to convert Vizhinjam Port near Thiruvananthapuram into a major port but with private operatorship. Thirty-one shipping companies, including domestic majors like Shipping Corporation of India and Essar, have shown interest in the project.
The port lies to the south of Vallarpadam terminal, which has been developed as the country’s first transshipment port, but is yet to get enough traffic. If Vizhinjam is given the status of a major port, the shipping ministry would be empowered to decide on whether to develop it as a transshipment hub, given its proximity to the International Container Transshipment Terminal (ICTT) in Vallarpadam, said an official.
Granting the major port status would be a key factor in deciding the transshipment plans of Vizhinjam. The central government plans to send a team to Vizhinjam shortly to decide on the Kerala government’s request, said the official.
The shipping ministry’s Maritime Agenda 2020 says the government will commission two major ports, one each on the east and the west coast, taking the total number of major ports in the country to 15. The last port to be added in the list was the Port Blair Port Trust last year.
The state government wants Vizhinjam to be a transshipment hub for containers, besides being a multipurpose cargo port. The Vallarpadam ICTT, operated by DP World, comes under the Kochi Port Trust, which is a major port. If Vizhinjam comes up as a transshipment terminal, it will eat into ICTT’s business.
The Vizhinjam Port boasts of having the deepest natural draft among all ports in India with water depth of 18-22 metres, which does not require maintenance or capital dredging. In the case of ICTT, extensive capital dredging is required even to a get a depth of 14.5 metres. Work on this is behind schedule, though the terminal was inaugurated in February this year.
Vizhinjam is over 200 kilometres south of the Kochi port, while the Vallarpadam ICTT is on an island near the Kochi port. Based on estimates from Drewry Shipping Consultants (UK), container volumes at Vizhinjam Port are expected to reach 822,000 twenty-foot equivalent units (TEUs) by the end of Phase 1, 2020; 1.76 million TEUs by the end of Phase 2, 2030; and 2.82 million TEUs by the end of Phase 3, 2044.
The ICTT is designed to handle over one million TEUs, which is expected to go up to four million TEUs by 2016, but due to the strict cabotage law which restricts coastal waters for Indian shipping companies, the traffic at Vallarpadam has not picked up. Both ICTT and the Kerala government have, therefore, applied for relaxation in cabotage to the Centre to carry on with the transshipment activity.
A former Kerala government official said Vizhinjam could serve as a great investment opportunity since it lies within 10 nautical miles of shipping routes that link the Persian Gulf and the Far East with Europe.
The shipping ministry had earlier this year asked all the state governments to suggest possible sites for developing major ports. Besides Kerala, Andhra Pradesh has shown interest in adding another major port on its coastline and suggested three locations. “It can be an interesting opportunity. We are also expecting the Karnataka government to suggest a possible major port site,” a senior shipping ministry official said.
The Kerala government plans to develop Vizhinjam Port as a ‘landlord port’ but the project is yet to be awarded as the government is waiting for the environmental impact assessment study. “The shipping secretary had written a letter to states for suggestions on developing more major ports. We are in the process of acquiring land and going ahead with the landlord model,” A Suresh, managing director, Vizhinjam International Seaport, told Business Standard.
