Construction of the
Vizhinjam seaport in Kerala, billed as the world’s deepest multi-purpose
seaport and India’s attempt to reclaim its trans-shipment cargo from Colombo,
is in a spot of trouble. While work on Phase I of the project has got back on
rails, surviving a stormy fortnight of blockades last month, honouring the
2019-deadline would be tough going given the man-days lost so far. The port
site is 10 miles southwest of Thiruvananthapuram.
The families of fishermen, mostly women, had been on the warpath, stopping
construction work on the seaport. The key demand is for the rehabilitation
package to be rolled out at the earliest, according to local politicians.
The Vizhinjam port is being
developed on a design, build, finance, operate and transfer (DBFOT) basis.
While the Kerala government owns the land, concessionaire Adani Ports and
Special Economic Zone (APSEZ) will manage the port including the civil
infrastructure and super-structure. Thirty per cent of the land would be used
for real estate development.
A recent notification has brought more buoy to the project. The Centre has
designated Vizhinjam, along with Mundra port, as an immigration check-post for
international ships and cruises entering and exiting India.
While its total cost is estimated at Rs 7,525 crore, the cost of the
project awarded to APSEZ is Rs 4,089 crore. Of this, 40% or Rs 1,635 crore
would be funded by the Centre’s Viability Gap Funding (VGF) scheme — Vizhinjam
is the first port to get VGF backing.
Phase I involves construction of berth length (800 m), and a container yard
(131 acres). According to Noushad Khan, a project contractor, “building the
3.1-km-long breakwater is the key part of Phase I. About 650 m is complete and
it is slow progress because of the heavy undercurrents”.
Gautam Adani, chairman of Adani Group, had announced in August, 2015 that
Phase I would be completed within 1,000 days of the start of work — this
happened in December, 2015. Further, APSEZ is contractually committed to this
deadline. Significantly, the breakwater at Vizhinjam is billed as a
construction challenge, making it difficult to recover the man-days lost due to
The promoters heaved a sigh of relief when the Kerala government rushed in
after protests broke out last month. Talks on November 3 saw the situation
being defused. “The state government has assured the protesters that the
compensation claims of those displaced due to the project will be settled
before November 30,” says Thiruvananthapuram District Collector K Vasuki.
This is not the first time the project has run into controversies. In its
2016 report, the Comptroller and Auditor General had pointed out that the
Vizhinjam MoU would ensure undue gains for the Adani Group — the state, to be
fair, did not have much choice on the contract since APSEZ was the sole bidder.
Second, it is not going to be the job-spinner it was touted as and has invited
protests from fishermen whose livelihoods are threatened. There is no major
industry in Kerala to reap the benefits of the proposed terminal. No major
industry can come up in the state due to paucity of land, inadequate
infrastructure and militancy of labour. The unintended beneficiary of the
project may be the neighbouring Tamil Nadu. Vizhinjam project however may pose
a threat to the Cochin container terminal which is already incurring losses.
Yet, the Kerala government sees Vizhinjam as a game-changer — the MoU was
signed by its predecessor UDF regime — given its proximity to the international
east-west shipping route, natural draft depth (18.4 m) that would minimise
dredging costs and savings likely on import and export costs. It is envisaged
to handle 4.1 million containers annually and would allow ultra-large ships of
18,000-TEU capacity to dock once completed.